Deductions from Wages

You must make certain deductions from the total compensation of both exempt and nonexempt employees. You are required to take out taxes and wage garnishments, if any. You can also take out money for certain work-related things.

In addition, the employee can volunteer to have certain monies deducted. Special rules apply to deductions for salaried employees. See Deductions from an Exempt Employees Salary.​​​​​​​​​

  • Deductions Overview

    Deductions OverviewYou cannot collect previously paid wages from an employee. This prevents the fraud usually associated with kickbacks.2  More »

  • Standard Deductions: Taxes

    Standard Deductions: TaxesYou must make certain tax deductions from employee paychecks.  More »

    ​Read about 2016 regulations.
  • Automatic 401(k) Payroll Deductions

    Automatic 401(k) Payroll DeductionsSection 11 of the DLSE’s Policies and Interpretations Manual relates to automatic 401(k) payroll deductions and offers guidance to employers who use self help methods to get repayments from employees.  More »

  • Employee Tardiness

    Employee TardinessIf an employee is tardy, you cannot deduct from the employee’s wages any amount in excess of the wage that would have been earned during the time actually lost.  More »

  • Employee Debts, Loans and Deductions

    Employee Debts, Loans and DeductionsWhile you can make deductions from wages for insurance premiums and other health and welfare plans, there are limits on other deductions.  More »

  • Deductions for Overpayment of Wages

    Deductions for Overpayment of WagesYou may not know the exact amount of hours that an employee worked in a pay period, for several reasons.  More »

  • Unreturned Tools and Uniforms

    Unreturned Tools and UniformsThe IWC Wage Orders provide that, in lieu of posting a bond, an employee can agree to a deduction from his/her last paycheck to cover the cost of tools, uniforms or other items you furnished that he/she did not return to you.  More »

  • Cash Bonds and Deposits

    Cash Bonds and DepositsYou cannot demand cash bonds from an employee, unless he/she is entrusted with property of an equivalent value or the bond is in an amount equivalent to the value of goods, wares or merchandise periodically advanced to the employee.  More »

  • Meals and Lodging

    Meals and LodgingYou can credit meals and lodging that you supply as part of an employee’s compensation against state minimum wage obligations. Meals must include a variety of nutritious foods.  More »

    ​​Read about 2016 legislation.
  • Garnishment Against Wages

    Garnishment Against WagesEmployers occasionally receive court orders garnishing an employee’s paycheck for payment of child support or other debts.  More »

    ​​Read about 2016 legislation.