Employers can run into a labor rights dilemma when they realize they need to recover money from employees. This may be the case when a worker is first hired and is expected to cover the costs of a new uniform, or when money goes missing from the business' cash register and company policy states employees must make up the difference. In other situations, employees may be held responsible for lost or damaged tools, according to J.D. Supra.

Recovering these costs, however, can result in expensive litigation if the employer violates the Fair Labor Standards Act (FLSA) minimum wage provisions.

Following a recent investigation, Wash-Tub, a car wash business in San Antonio, Texas, was forced to pay 308 employees back wages totaling $246,438 for making illegal paycheck deductions for uniformers, insurance claims and register shortages.

Under the FLSA, employers may only deduct these costs if it does not cause employees' pay to fall below minimum wage or take away from their earned overtime pay. Businesses can use an advanced payroll processing service to carefully monitor remuneration, and stay in compliance with labor law while they recouping certain losses. 

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