Hi Happy Holidays to all...

I have an employee who borrowed money from the company we work for. The employee still owes just about half. He has since given notice. The employee has signed a promissory note stating that his employer has the right to withhold any and all salary and or compensation dues to offset the balance of the loan. Now my question is, Is the employer allowed to hold his last paycheck in lieu of the loan repayment?

Thank you for all your help..

:)

If he signed an agreement stating that the employer has the right to withhold any amount still owed out of his check, then yes they can take the money. However, I am a little sketchy on whether they can take the entire check. Usually when an employer withholds money, they can only withhold enough to leave the employee with at least enough to be considered minimum wage. I am sure someone will come along shortly and clarify that, but yes. They can take the money. Anything else that he owes past that they would have to go after in court.

To be on the safe side, I would leave him with at least minimum wage as well. With a promissory note, you have options outside the employment relationship.

Thank you for all your help

:D