Wage and Fringe Benefit Act
Q:
What is the Wage and Fringe Benefit Act?
A: The
Wage and Fringe Benefit Act was enacted by the Michigan Legislature
in 1978 to regulate the time and manner of payment of wages
and fringe benefits to employees. The Act also regulates the
authority of the employer to take deductions from the wages
or fringe benefits due to be paid to the employee.
Q:
Under what circumstances can an employer take deductions from
an employee's wages?
A: The
Act generally limits the employer from taking deductions from
an employee's wages unless the deduction is authorized by
law, by collective bargaining agreement, or by the voluntary
written consent of the employee. The Act also allows the employer
to take deductions from the employee's wages in certain circumstances
to correct a payroll error that results in an overpayment
of wages.
Q:
Under what circumstances can an employer take deductions to
correct an overpayment of wages without the consent of the
employee?
A: The
overpayment of wages must have occurred as a result of a mathematical
miscalculation, typographical error, clerical error, or misprint.
The deduction must be taken within 6 months after making the
overpayment and the employee must be given written notice
of the deduction at least one pay period before the deduction
is taken. Finally, the amount deducted may not be greater
than 15% of the employee's gross wages for the pay period
nor may the deduction reduce the employee's wages below the
minimum wage required by law.
Q:
Can the employer withhold an employee's final paycheck until
the employee returns employer equipment?
A: No, the Act prohibits the employer from withholding pay
or taking deductions from the employee's wages unless the
deduction is authorized by law, collective bargaining agreement,
or the employer obtains the voluntary written consent of the
employee.
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