No. In New Jersey, a company may not deduct monetary losses to the company, for which the worker arguably was at fault, from the worker’s paycheck. For example, if an employee gets parking tickets while driving a company car for business, the company may not deduct the parking fines from the employee’s paycheck.
Similarly, an employer may not withhold, from a cashier employee’s paycheck, a shortage in a cash register. However, in general, if the employee is at-will, then the company may fire him for causing the company a loss.
In general, under the New Jersey Wage Payment Law, N.J.S.A. § 34:11-4.1 et seq. (the “Wage Payment Law”), an employer may not “withhold or divert any portion of an employee’s wages unless . . . the employer is required or empowered to do so” by State or federal law. N.J.S.A. § 34:11-4.4, 34:11-4.4(a).
It is lawful for an employer to withhold or divert a portion of an employee’s wages for purposes specifically authorized by the Wage Payment Law. These allowable purposes do not include reimbursing the employer for monetary losses which arguably were the worker’s fault. So, for example, permissible purposes for withholding or diverting part of an employee’s wages do not include reimbursing the employer for parking fines incurred by an employee, or for a shortage in a cashier employee’s cash register.
Rather, purposes for which the Wage Payment Law allows an employer to withhold or divert a portion of an employee’s salary include, among other purposes:
See N.J.S.A. § 34:11-4.4(b). However, in the absence of a contract, a company in New Jersey may fire its employee for causing the company a loss, carelessly or otherwise. So, for instance, an employer may fire a worker for incurring parking tickets while using a company car for business.
A company has this autonomy to fire because, in the absence of a contract, employment in New Jersey is at-will. In New Jersey, an at-will employee is subject to termination for any reason or no reason, unless (i) the discharge is for a reason prohibited by statute or (ii) the discharge is contrary to a clear mandate of public policy.
David S. Rich is the founding member of the Law Offices of David S. Rich, LLC,
a Manhattan Employment and Business Litigation Law Firm, in New
York City and in Englewood Cliffs, New Jersey...View Profile