Think twice before docking employees' pay for broken dishes, missing money

In today's economy, business owners are often counting pennies to come in on budget. Without much of a cash flow cushion, employers and supervisors have been forced to cut back on extras like year-end bonuses, parties for employees and free breakfasts on weekday mornings. Greater financial pressure also means employers are being forced to do more with less to prevent cash flow leakages in their employee attendance and payroll responsibilities.

As such, it might seem reasonable to dock an employee's pay for uniform costs, training programs or money that goes missing from the register when an individual is on duty.

The following are also common reasons to dock workers' pay, as highlighted by Human Resources and Legal Rights - damage to employers' vehicles, inventory shortages, uniform laundering costs and expenses covered by employers.

However, there are regulations that prevent employers from deducting workers' pay, especially when it comes to hourly workers. A company is not allowed to subtract any of the above mentioned costs from workers' paychecks if it causes their pay rate to fall below the minimum wage standard, which is currently $7.25 per hour.

Unless employees are compensated far enough above this baseline that subtractions don't cause their wages to fall below the acceptable minimum, employers may want to absorb additional costs to avoid Fair Labor Standards Act (FLSA) violations.