What Can’t You Deduct From Day Labor Pay?

Nationwide Temporaries

Some companies find it necessary to provide day laborers with transportation, meals, uniforms and other such things. These companies might then look to deduct the expenses associated with these expenses from day laborers’ pay.

This arrangement raises certain legal issues. Under federal regulations, a company can make particular kinds of deductions from a day laborers’ pay. However, an employer cannot deduct items that are necessary to perform the job, such as safety equipment. Generally speaking, any deductions cannot bring the worker’s pay to below the federal minimum wage.

Permitted deductions

A company can make deductions from day laborers’ pay provided the deductions do not result in a pay rate that is less than minimum wage and several conditions are met.

The day laborer must have actually received the benefit and agreed to receive the benefit. A company cannot furnish the benefit primarily because it is more convenient than not doing so. Furthermore, receiving the benefit cannot violate state or federal laws and it should be provided at a reasonable cost.

Finally, the benefit should be provided regularly, or similar benefits should be provided by other companies in similar geographic locations.

Restricted deductions

Benefits are established solely for the convenience of the company may not be deducted from a day laborer’s pay. For instance, if a day laborer has their own transportation arrangements, but the company does not permit this on the grounds that all workers must report to a job site on time, then the transportation is for the employer’s benefit, not the worker’s, and therefore cannot be deducted. Or if the company supplies transportation so work-related training can occur during the trip, then the day laborers must be paid for travel time.

Safety tools and equipment essential to doing work are prime examples of items that cannot be deducted from day laborers’ pay. These items should not be deducted as they are thought to be necessary and convenient for the company to lawfully ask workers to carry out their work. If safety equipment is necessary under state law, then it is to be considered part of a uniform, and therefore not to be deducted from worker pay.

In general, uniforms are not to be credited against a day laborer’s pay if they are essential for legal reasons, required by the company or required due to the nature of the work being conducted. Day laborers may not be compelled to cover the cost of any such items if, by so doing, their pay would be decreased below the federal minimum wage or overtime compensation rates. This is true even if a monetary loss suffered by the company is as a result of negligent actions by a day laborer.

At Nationwide Technologies, we strictly adhere to all federal, state and local regulations when helping our clients source the labor they need to achieve their objectives. If your organization is currently looking for a labor solution, please contact us today.


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