Employers are not bound by any federal laws to issue an employee\u2019s final paycheck by a certain date. Instead, each state has the discretion to determine its own final paycheck rules, with most states adopting separate final paycheck time limits for employees who are terminated and employees who quit. Generally speaking, employees who are terminated (fired or laid off) are required to receive their paychecks much sooner than employees who voluntarily quit.<\/p>\n
Read on to learn more about final paycheck laws for Arizona and how they differ from other states.<\/p>\n
There are 8 states that require the employer to issue a terminated employee their final paycheck immediately\u2014California, Colorado, Hawaii, Massachusetts, Minnesota, Missouri, Montana (with some exceptions), and Nevada. On the opposite end of the spectrum, there are 27 states that allow employers to wait until the next scheduled payday\u2014Delaware, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Nebraska, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Tennessee, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.<\/p>\n
Outside of the 4 states that don\u2019t have any applicable statutes (Alabama, Florida, Georgia, and Mississippi), the remaining 11 states require the employer to issue a terminated employee their final paycheck within 1 \u2013 15 days (unless the next scheduled payday is sooner, in which case the final paycheck is due on that date).<\/p>\n
In Arizona, employers are required to pay a terminated employee their final paycheck within 7 working days or by the next payday, whichever is sooner (ARS 23-353<\/a>). Failure to issue the final paycheck in a timely manner is considered a petty offense.<\/p>\n Employees who quit should still receive their final paycheck in a timely manner, but the majority of states have more relaxed requirements on this matter. In fact, only 10 states require payment sooner than the next payday\u2014California, Hawaii, Idaho, Louisiana, Montana, Nebraska, Nevada, New Hampshire, Oregon, South Carolina.<\/p>\n In Arizona, employers are permitted to issue a final paycheck to an employee who has quit on the next payday. However, while the deadline is more relaxed in this case, failure to issue the final paycheck on time is still considered a petty offense and the employee can a claim or lawsuit against the employer.<\/p>\n Unfortunately, it\u2019s not uncommon to see issues where an employer withholds a portion of an employee\u2019s final paycheck, especially when the employment relationship is ending on poor terms. To address such cases, Arizona legislators have crafted the law to protect employees against unlawful wage withholding, while providing room for employers to legally withhold wages in reasonable situations.<\/p>\n Under ARS 23-352<\/a>, employers are allowed to withhold an employee\u2019s wages when \u201cthere is a good faith dispute as to the amount of wages due, including the amount of any counterclaim or any claim of debt, reimbursement, recoupment, or set-off asserted by the employer against the employee.\u201d Most cases where an employer legally withholds a portion of the final paycheck include situations where the employee has stolen or damaged property, and the employer is reasonably seeking compensation for the stolen or damaged property. An employer can\u2019t dock an employee\u2019s pay as punishment or for taking short breaks.<\/p>\n It\u2019s important to note that an employer is only allowed to withhold the portion of the final paycheck that is reasonably disputed. Unless the disputed value meets or exceeds the value of the final paycheck, the employer cannot withhold the entire paycheck\u2014only the disputed portion. The employer is required to investigate and resolve the dispute in a reasonable amount of time, so the company can\u2019t withhold the disputed portion for too long. While there isn\u2019t a set time limit for this, it\u2019s reasonable to allow enough time for any related police investigation or court cases to conclude, though the employer may be required to pay additional damages to the employee if the police investigation and\/or court case doesn\u2019t end in the employer\u2019s favor.<\/p>\n The state of Arizona doesn\u2019t require employers to include unused benefit time (vacation time, sick time, etc.) on the final paycheck. However, if the company has a collective bargaining agreement, written contract, or formalized company policy that mandates paying out unused benefit time, the employer will be required to include this on the final paycheck.<\/p>\n If your employer fails to issue your paycheck within the state\u2019s statutory time period (7 business days if you\u2019re terminated, the next payday if you quit), or if the employer wrongfully withholds any wages due, you have two options for remediation:<\/p>\n If you don\u2019t receive the final paycheck within 14 days of your last day, you can also contact the US Department of Labor (DOL<\/a>). That said, if your unpaid wage case doesn\u2019t include a violation of the Fair Labor Standards Act<\/a> (regulates minimum wages, overtime pay, and record keeping requirements), the DOL will most likely direct you to the appropriate state agency. In this case, that\u2019d be the ICA. If there is a violation of the FLSA, the DOL may refer your case to the Wage and Hour Division (WHD<\/a>).<\/p>\n It\u2019s important to note that you can\u2019t file a civil lawsuit and file a complaint with the ICA\u2014you\u2019ll need to choose one or the other. As such, it\u2019s important to discuss your unpaid wages case with an experienced employment law attorney who can assess your case. The attorney will calculate your unpaid wages and potential damages, and he or she can advise you on whether you should file a civil lawsuit or file a complaint with the ICA. Generally speaking, it\u2019s usually best to file a civil lawsuit rather than a complaint with the ICA if your unpaid wages are more than $5,000.<\/p>\nFinal Paycheck Requirements for Employees Who Quit<\/h2>\n
Final Paycheck Withholding Restrictions<\/h2>\n
Paying Out Unused Benefit Time<\/h2>\n
What to Do if You Don\u2019t Receive Your Final Paycheck<\/h2>\n
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