(Note for employers: Do not include the information in parentheses here in any actual form that employees sign. Texas Payday Law Rule 821.28(b) requires written authorizations for deductions to be as specific as possible as to the amount and purpose of the deduction and to make it clear that the deductions will be made from the employee's wages. Rule 821.28(d) requires deductions to be applied to their intended purposes. When drafting such an agreement, try to be specific enough to where a reasonable employee would be able to predict how much a particular deduction would be in a particular situation. What appears below is not an official form - it is only a sample that is meant to illustrate how such deductions may be authorized in writing.)
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WAGE DEDUCTION AUTHORIZATION AGREEMENT
I understand and agree that my employer, __________________________ (the Company), may deduct money from my pay from time to time for reasons that fall into the following categories:
- my share of the premiums for the Company's group medical/dental plan;
- any contributions I may make into a retirement or pension plan sponsored, controlled, or managed by the Company;
- installment payments on loans or wage advances given to me by the Company, and if there is a balance remaining when I leave the Company, the balance of such loans or advances;
- installment payments on loans based upon store credit that I use for my own personal purchases, including the value of merchandise or services that I purchase or have purchased for personal, non-business reasons using my employee charge account or credit card, an account or credit card assigned to another employee, or a general company account or credit card, regardless of whether such purchase was authorized, and if there is a balance remaining when I leave the Company, the balance of such store credit or charges;
- if I receive an overpayment of wages for any reason, repayment to the Company of such overpayments (the deduction for such a repayment will equal the entire amount of the overpayment, unless the Company and I agree in writing to a series of smaller deductions in specified amounts);
- the cost to the Company of personal long-distance calls I may make, or messages I may send, using Company phones (land lines or cell phones) or Company accounts, of personal faxes sent by me using Company equipment or Company accounts, or of non-work related access to the Internet or other computer networks by me using Company equipment or Company accounts;
- the cost of repairing or replacing any Company supplies, materials, equipment, money, or other property that I may damage (other than normal wear and tear), lose, fail to return, or take without appropriate authorization from the Company during my employment (except in the case of misappropriation of money by me, I understand that no such deduction will take my pay below minimum wage, or, if I am a salaried exempt employee, reduce my salary below its predetermined amount)*;
- the cost of Company uniforms and of cleaning the uniforms (the Company will deduct only the actual price it pays for uniforms and cleaning costs)**;
- the reasonable cost or fair value, whichever is less, of meals, lodging, and other facilities furnished to me by the Company in connection with my employment***;
- administrative fees in connection with court-ordered garnishments or legally-required wage attachments of my pay, limited in extent to the amount or amounts allowed under applicable laws;
- if I take paid vacation or sick leave in advance of the date I would normally be entitled to it and I separate from the Company before accruing time to cover such advance leave, the value of such leave taken in advance that is not so covered;
- the value of any time off for absences to which paid leave is not applied (except in the case of those who are paid a fixed salary for fluctuating workweeks, non-exempt salaried employees will have all such unpaid leave deducted from their salary, while exempt salaried employees will experience salary reductions only in units of a full day or week at a time, depending upon the exact nature of the absence, unless partial-day deductions are specifically allowed under federal law); and
- if my employer pays any insurance premiums or retirement system contributions ("payments") on my behalf that I would normally make under the applicable Company benefit plan, the amount of such payments made by the Company, such payments being an advance of future wages payable to me.
- (any other items appropriate for your company's situation - go over this with your attorney).
I agree that the Company may deduct money from my pay under the above circumstances, or if any of the above situations occur. I further understand that the Company has stated its intention to abide by all applicable federal and Texas wage and hour laws and that if I believe that any such law has not been followed, I have the right to file a wage claim with appropriate Texas and federal agencies.
Signature of Employee
Employee's Name - Printed
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Notes for employers to keep in mind - do not include the following comments in any form used by the company. They are here only to explain about particular types of deductions:
* (Deductions for this purpose that take the pay below minimum wage, or that cut into an exempt, salaried employee's salary, are allowed only in the case of misappropriation of money by the employee; in addition, the employer must be able to prove that the employee was personally responsible for the misappropriation.)
** (Caution: this is a type of deduction that is strongly restricted by federal wage and hour regulations - see the provision for uniform cost deductions in Part 531 of the regulations (Title 29 of the Code of Federal Regulations, Part 531), and also Section 30c12 of the Department of Labor's Field Operations Handbook - both of those provisions are explained here.)
*** (See Part 531 of the wage and hour regulations, as well as Sections 30c00 - 30c09 of the Field Operations Handbook - click here.)
Note: do not include the asterisks in the form or the parenthetical comments immediately above in an actual form to be signed by employees. The asterisks and explanations are included here only to call your attention to the issues in question. If you have any questions, call the TWC employer Commissioner's office at the toll-free number 1-800-832-9394, or consult an employment law attorney of your choice.
See also: Deduction Problems under the Texas Payday Law
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