In workforce management, there will always come a time when you have to discipline employees. Whether someone's always two hours late or regularly misses deadlines, you're going to have to find a way to give troublesome workers more than a slap on the wrist.
Short of firing someone, one of the most common strategies is to dock a staff member's pay. However, that's can't always be done because it's illegal and can open you up to a host of liabilities. According to Inc. Magazine, withholding pay puts you in direct violation of the Fair Labor Standards Act. Doing so gives employees exempt status, which means that you have to pay them overtime for every hour worked in the future and retroactively.
However, there are still situations in which you can revoke compensation for certain actions. The following are some of the instances in which you're allowed to dock wages by using your payroll services system.
Resignations
Standard protocol calls for two weeks notice when someone quits. This is supposed to give the business sufficient time to find ways to replace that person, either through redistributing the work to the existing staff or hiring a new candidate. A resignation also causes some questions for payroll.
HR Morning lays out one potential scenario in which an employee quits in the middle of the week. Is the employer responsible for paying that worker's wage for the entire week?
In this specific scenario, it's legally permissible to dock pay for the days that the former staff member doesn't work. This is because the contributor isn't performing any of the tasks that they're responsible for during his or her tenure.
Violations
The news source goes on to explain that pay can also be docked when professionals break safety rules or are suspended because of detrimental actions. These have to be major violations that pose threats to others or clearly contribute to a hostile work environment. This can include sexual harassment and repeated bullying. The Society for Human Resource Management notes that this doesn't apply if the employee in question only earns minimum wage.
Covered absenteeism
HR Morning also explains that pay can be docked when employees are absent and receive compensation from an institution. This means that you can withhold wages to balance out the difference when staff members are on jury duty or military duty.