• Unless mandated by law, a company can usually wait until its regular payday to provide terminated employees with a final paycheck.
• After a holding period, unclaimed paychecks can be turned over to a state agency for unclaimed property.

Employers are not required by the Fair Labor Standards Act (FLSA) to give former employees the final paycheck immediately. Some states, however, do require immediate payment or payment within a few days after termination. The Department of Labor (DOL) suggests that if the regular payday for the last pay period an employee worked has passed and the employee has not been paid, the person should contact the DOL’s Wage and Hour Division or the state labor department.

The DOL and the Equal Employment Opportunity Commission also have mechanisms in place for the recovery of back wages. A common remedy for wage violations is an order that the employer make up the difference between what the employee was paid and the amount the person should have been paid. The amount of this sum is often referred to as “back pay.” Among other programs, back wages may be ordered in cases under the FLSA or the various federal discrimination statutes.

Unclaimed paychecks

In some cases, employees will fail to pick up a final paycheck, even after the employer has made it available. It may even happen that a mailed final check will be returned to the company as undeliverable.

Many state wage and hour laws address the payment of wages, but not an employee’s failure to collect that payment. However, this does not mean that employers get to keep the money. Typically, the employer will need to hold the check for a period of time, and later turn it over to a state agency for unclaimed property. Employers may contact the state unclaimed property agency for guidance.