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Final paycheck rules should be a prime concern for workers in Denver, Boulder, Aspen, and everywhere else in Colorado. They make sure that employers pay their employees what they are owed when they leave employment.
Rules on final paychecks include when a payment must be made, when deductions can be legally taken out, and what happens to unused vacation days when you leave the company.
When an employee has been fired, the payment of all the outstanding wages that are owed can be a key source of anxiety. In Colorado, the rules on when an employer must pay the final paycheck are very clear – the employer must pay wages immediately.
The only exception is if the department responsible for the employer’s payroll checks is not normally scheduled to be working at the time of the firing. Then, wages must be made available within six hours of the start of this unit’s next regular workday. If the department is located away from the work site, the final paycheck must be delivered to the employee within 24 hours of their next regular workday.
If an employee resigns from a job, an employer in Colorado must issue their final paycheck at the next regularly scheduled payday.
In either situation, a final paycheck must include any unused vacation pay earned by an employee in accordance with their individual contract.
In general, deductions from a final paycheck are permitted only for things like taxation and court-ordered deductions, and where the employee has expressly consented to a particular deduction (for example, a charitable donation or a payment into a saving plan). Colorado’s law also says that an employer can make deductions from a final paycheck to cover the replacement cost of something stolen by the employee, or to cover an amount of money or value of property entrusted to the employee during their work.
If the employee is accused of theft, there must have been a report filed to the relevant law enforcement agency. If they are later found not guilty of the theft or the case was dismissed, they will be entitled to recover the amount withheld.
If an employer has not followed the timeframe for issuing a final paycheck, an employee or their attorney is required to make a written demand for the unpaid wages. If the employer does not pay within 14 days, an employee can commence a civil action to recover the final paycheck funds.
An employer that fails to pay the final paycheck could, in addition to the wages owed, be ordered to pay a penalty to the employee. A qualified wage and hour attorney will be able to provide detailed advice on how this would apply to an individual case.
If an employee dies with outstanding wages owed to them, and there is no personal representative to their estate named, the final paycheck will be paid to the employee’s surviving spouse or legal heir.
This article is intended to be helpful and informative. But even common legal matters can become complex and stressful. A qualified wage and hour lawyer can address your particular legal needs, explain the law, and represent you in court. Take the first step now and contact a local wage and hour attorney to discuss your specific legal situation.