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Pay and benefits when terminating employment
  • Unless mandated by law, a company should stick to its usual pay schedule when terminating a person’s employment to avoid worker claims.

Employers may be subject to federal and state laws on distributing pay and benefits when an employee is terminated.

Generally, payday frequency is either weekly, bi-weekly, semi-monthly, or monthly. Where a payday frequency is specified, employers still have the option to pay employees more frequently. For example, if state law mandates bi-weekly pay periods, employers may still choose to pay employees weekly (more frequently than required).

Some states have different requirements for various types of employment. A state may require bi-monthly payments for hourly workers, but allow monthly payments for exempt employees.

If employees do not receive wages on the required payday, the employee may be able to file a wage claim with a state agency to recover the unpaid amounts. For this reason, employers cannot hold a paycheck, or make deductions for unlawful reasons.

Even though the Fair Labor Standards Act (FLSA) does not specify a frequency of paydays, an employer’s usual or established schedule of paydays will likely create an expectation (or even an “agreement”) that employees will be paid on that schedule. If the check is not provided, the employee may request payment. And if payment is unreasonably delayed, the employ may have cause for a claim.