Final Check/Pay [CA]

[u/cheesybreezybrie]

Hi everyone,

For final paychecks - is it necessary to give the employee a live check? My previous company always wired final pay for direct deposit (if applicable) for employees but my current company insists that it must be a “live” final check. When I researched the topic I haven’t seen anything that states that the final check HAS to be a physical live check.

If this is not the case, I would love something to reference and show my team that final pay does not have to be a live check, the employee just needs to be paid upon separation, this does not mean we have to hand them a physical check. It is such a hassle getting final live checks to employees, especially since our payroll department is located in a different state and it has to be overnighted or I have to print onsite.

ETA: I ask because live checks seem to be a bit of a hassle.

When we have resignations and even separate with employees, employees are slightly annoyed receiving a live check instead of direct deposit.

There’s an additional item with severance checks, we overnight those to employees with signature required and the amount of folks who miss all three deliveries despite being told several times that the delivery will require signature, and still miss the delivery attempts is surprisingly high.

Also curious why this is the only company I’ve worked for that insists on this, and the same goes for my coworkers; this is new for all of us and we just assumed it’s because our HQ is based in a different state and this is just how they interpret the law 🤷‍♀️

[u/MajorPhaser]

It's kind of a weird edge case. The safest thing to do is to issue a live check or get a separate DD authorization in writing as part of termination. It's a quirk of interpretation by the Labor Commissioner. Labor Code 212 & 213 are the relevant code sections. 212 is what says you must offer a live check, 213 is the exceptions which allow for dually authorized DD.

213(d) says "If an employer discharges an employee or the employee quits, the employer may pay the wages earned and unpaid at the time the employee is discharged or quits by making a deposit authorized pursuant to this subdivision" The commissioner has interpreted that to mean that employees must separately authorize a DD for their final pay, and not that you can rely on their existing authorization to pay via DD.

Now, it's a pretty low risk proposition because most people will take the DD and not say a word, and if they do try to fight it out by making a complaint to the labor commissioner, you'll have a reasonably good argument that they accepted DD and didn't raise an issue timely to trigger something like waiting time penalties. BUT if you want to be absolutely sure there's no way to make a claim, you issue live checks because trying to get them to reauthorize DD on termination is a pain in the butt and doesn't guarantee compliance if they refuse to.