Labor Law Spotlight: Final Pay Check Issuance

Here are the rules for employers in California for issuing the final paycheck to terminating employees:

Company Size Covered: ALL California Employers

Involuntary Termination
If you terminate an employee's employment for cause (fired) or due to a reduction in workforce (RIF) you must issue the final paycheck at the time of notification of termination. In other words, hand them the check right after you tell them they are terminated.

Voluntary Termination
If an employee resigns on their own volition, you have three calendar days from their last day of work to issue their final paycheck. To be on the safe side, use three realtime days, not workdays.

All final paychecks must include any accrued vacation time or PTO. This is vested for employees in California.

You cannot withhold the check past the timelines above for the return of company property. That is a stand-alone matter.

There is no definite rule for resolution of outstanding reimbursable expenses for employees. So do yourself a favor and just pay expenses quickly.

Lance