Having worked hard for their money, many employees are surprised to see deductions being made from their paycheck. While deductions for Social Security are legitimate, many employers try to shift the cost of doing business onto workers by deducting illegitimate expenses from pay.
If this describes your situation, or if you have questions about a withholding or deduction your employer has made, then speak with one of our New Jersey employment lawyers today. This is a confusing area of law, but employees do have legal recourse.
New Jersey Law on Deductions
The New Jersey Wage Payment Law can be found at N.J.S.A. 34:11-4.1 to -33.6. This law sets out the rules on the timing and mode of payment. However, the law also prevents an employer from withholding a portion of an employee’s wages unless specifically required by state or federal law. The statute, N.J.S.A. 34:11-4.4, also lists 11 other categories of acceptable withholdings, such as contributions authorized by employees or their collective bargaining unit for the rental or laundering of work uniforms.
However, as you can see, the law requires that the union or the employees authorize the withholding. It would be illegal, for example, for an employer to deduct from a worker’s wages the cost of laundering or renting a uniform without the employee’s consent. The same is true for other deductions not included in the statutory language. So, for example, making a deduction for the cost of purchasing tools would also be illegal.
There is a key distinction that must be made. An employer can, consistent with the law, require an employee to provide their own uniform or tools. What the employer cannot do is make a deduction from a paycheck without authorization.
Illegal Deductions and Independent Contractors
Independent contractors are not employees. If you are misclassified, illegal withholdings from your pay can include specific expenses. For example, many trucking companies withhold for the following:
- Fuel costs
- Uniforms
- Lodging
- Truck rental
- Tolls
- Insurance
- Workers’ compensation insurance
Misclassifying an employee as an independent contractor is bad enough. To make illegal withholdings on top of that only compounds the problem.
What to Do if an Illegal Deduction is Made
Fortunately, New Jersey court decisions recognize that employees can bring a lawsuit for any violation of the New Jersey Wage Payment Law. This law is construed liberally to give maximum effect to its terms, which include prohibitions on making illegal withholdings. If successful, a worker should receive compensation in the amount of the money withheld. If you have been working for an employer for a long time, or if an employer is illegally deducting from hundreds of employees, then a lot of money could be at stake.
However, workers are best served by getting legal help immediately. A lawyer can help fully document the amount of the deduction and whether you are misclassified. Evidence is vital that you did not agree with the employer that they could make the withholding.
For help with your case, please contact Sattiraju & Tharney, LLP today. Our team has aggressively represented workers for years, and we are able to help you as well. Contact us to schedule an initial consultation.
FAQs About Illegal Withholdings from Pay in New Jersey
What does the New Jersey Wage Payment Law (NJWPL) say about deductions?
The NJWPL (N.J.S.A. 34:11-4.4) prohibits employers from withholding or diverting any portion of an employee’s wages unless the deduction is required by law (like Social Security) or falls into one of 11 specific categories. Even then, many deductions—such as for uniform laundering—require the written consent of the employee or their collective bargaining unit to be legal.
Can my employer deduct the cost of tools or cash register shortages from my pay?
No. It is generally illegal for an employer to deduct the cost of purchasing tools or to require reimbursement for cash drawer shortages directly from an employee’s wages. While an employer may require you to provide your own tools as a condition of employment, they cannot make a unilateral deduction from your paycheck to pay for them.
How do illegal withholdings affect workers misclassified as independent contractors?
Employers often misclassify workers to shift business costs onto them. If you are an employee misclassified as an independent contractor, deductions for fuel, tolls, insurance, truck rentals, or marketing fees are likely illegal. New Jersey law allows misclassified workers to file a lawsuit to recoup these unauthorized deductions, and you typically have up to six years to file a claim.