One of the most hotly litigated areas of Louisiana law involves that final paycheck once an employee quits or is fired. It is not only the final pay that is at issue, it can also be vacation pay and other employment benefits. When and how are employers required to make these payments?
 

Assessing fines against employees is unlawful

As tempting as it may be for an employer to fine an employee or deduct from his paycheck for things like dropped dishes, this is illegal. This would not apply if the breakage is willful or negligent. The deduction from a paycheck for some violation of the employer's policies could definitely come under this law (LSA R.S. 23:635).

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First of all, it needs to be understood that Louisiana is an "at will" employment state. In other words, you are free to quit whenever you want and your employer is free to fire you at any point, no questions asked. There are exceptions, of course. The most common exception is where there is an employment contract that spells out the circumstances under which an employee can be discharged or resign.

In addition to contractual exceptions to at will employment, there are also exceptions dealing with discrimination. An employer can fire an employee, but if the reason for the firing involves discrimination, and if the employee is in one of the classes of protected persons, there may be a violation of state or federal discrimination laws. In the great majority of cases, if you are fired and you feel that it "is not fair" that you were fired, there is little you can do about it.

Time and manner of final payment

You can, however, make sure that you receive every bit of compensation to which you are entitled as the result of your employment and you can make sure that your former employer pays you promptly. It is the duty of the employer to pay the employee all amounts that are due "on or before the next regular payday or no later than 15 days following the date of discharge, whichever occurs first" (LSA R.S. 23:631). This is the case whether the employee quits or is discharged. Other requirements of this law are:

	Payment can be made at the place and in the manner which has been customary during the employment or it can be made by mail to the last address of the employee as shown on the employment records. Payment is deemed made when the letter is postmarked.
	These provisions do not apply is there is a collective bargaining agreement with contrary terms.
	If the amount due is disputed, the employer must still pay the amount that is not disputed.
	Vacation pay is subject to this law only if 1) the employee is deemed eligible for and has accrued vacation time under the employers stated vacation policy, and 2) the employee has not taken or been compensated for the vacation time prior to the discharge or resignation.

Penalties for failure to pay

Any employer who fails to pay under the provisions of the law can also be liable to the employee for either 90 days of wages at the employee's rate of pay or else full wages from the date of the employee's demand to the date of full payment, whichever is less.

The employee might also be entitled to reasonable attorney's fees if the employee is successful in a suit against the employer. The employee has to have waited three days from the time of his demand before filing suit in order to be entitled to attorney's fees.

Loans to employees

An employer can loan money to an employee, and repayment can be direct or through withholding from the employee's paycheck, but the interest on the loan cannot exceed 8%.

How can demand for payment be made?

There is no requirement as to how the demand for final payment must be made. It can be by telephone, as was done in several cases. However, common sense would show that it is better to put the demand in writing and have proof of the date it was delivered to the employer. Otherwise, the opportunity to receive penalties can be lost for lack of proof that the proper demand was made.

Speaking of attorney's fees...

In Voitier v. Church Point Wholesale Beverage (760 So. 2d 451) decided in 2000, an employee received an award of $60,000 in attorneys fees for his successful suit for unpaid wages. The possibility of attorneys fees being awarded is often the biggest reason for an employer to make sure this statute is complied with.