Wages Withheld Because Cash Gift Retroactively Turned into Cash Advance

[talon74]

My question involves employment and labor law for the state of: Kansas

A friend of mine lost almost everything in a fire. The friend works for a small restaurant franchise. Her employer gave her some cash and an appliance to help get her back on her feet. There was nothing in writing and no witnesses other than the manager and my friend. At the time of the gift, my friend clarified with management that this was indeed a gift and not a cash advance. Shortly thereafter, my friend had to quit and did so with no notice. Now, the employer is withholding her final check and demanding she repay the rest of the cash gift saying it was really a cash advance.

Federal Wage and Hour laws seem to say they must pay her no matter what. However, if they are going to lie and say it was an advance instead of a gift, it comes down to her word against theirs.

Note that the amount is fairly small and it would not be cost effective to hire a lawyer. Any tips on where to find precedent on cash gifts being retroactively called cash advances? Is there any requirement that cash advances must be in writing?

Thanks!

[Betty3]

I can understand that the employer would want the cash back if the employee quit shortly thereafter & w/o notice.

However, the final paycheck cannot be withheld. In Ks. upon termination, voluntary or involuntary, employees must be paid their final paycheck on the next regularly scheduled payday when they would have received payment for those wages had employment not ended. Payment must be either through regular pay channels or by mail postmarked within the deadline if requested by the employee.

Even if this was a cash advance, in Ky. deductions from paychecks can only be made for cash advances that the employee requested & with their written authorization.

Your friend should put in a claim/complaint with the state DOL.

[talon74]

Thanks for the response. However, when you said, "Even if this was a cash advance, in Ky. deductions...", did you mean in KS, not KY? If you meant KS, can you point me to the statute that says deductions for cash advances must be in writing?

[Betty3]

Oops, sorry - good catch. Yes, I meant Ks. even though I typed Ky.

Kansas Statutes Annotated 44-319 et seq and KS ADC 49-20-1

Employers may only withhold or deduct from employees wages in the following circumstances: (1) when required or empowered by state or federal law; (2) for deductions for medical or hospital care without financial benefit to the employer that are openly recorded in the employer's books; (3) to correct wage overpayments resulting from employer error as long as the recovery rate isn't greater than the overpayment rate (the recovery rate may exceed the overpayment rate with the employee's signed authorization); *****(4) for cash advances made at the *employee's written request* and as part payment for future wages to be earned;*****(5) for excess cash expense allowances or advances that aren't justified by expense receipts and not returned to the employer; (6) with the employee's signed, written authorization for deductions accruing to the benefit of the employees; and (7) for contributions attributable to automatic enrollment, as defined by statute, in a retirement plan established by employer described in sections 401k, 403b, 408, 408A or 457 of the Internal Revenue Code. Certain deductions are forbidden even with the employee's written consent. They include deductions for cash or inventory shortages, breakage, returned checks or bad credit card sales, or losses on account of burglary, robbery, or alleged neligent acts. Also, deductions may not be made for uniforms or special tools/equipment that aren't necessary for performance of an employee's duties and are customarily supplied by the employer.

[talon74]

Excellent, thank you!

[Betty3]

You're very welcome.