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Legality of docking paycheck due to accepting a counterfeit bill California

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  • Legality of docking paycheck due to accepting a counterfeit bill California

    Last Friday, my longtime employee accepted a fake $100 bill. This is the fourth counterfeit $100 in my business this year, though not by her. It seems I am getting one a month.

    After the first fake bill was accepted in January, I docked the employee's pay (without protest) and called all my cashiers to inform them about it and to give them specific instructions on how to check for fake bills. For the next two fake bills, I couldn't tell whose shift it came from, so I ate the loss. However, I called each employee again reminding them about how to accept fake bills. The third time I physically took the fake bill with a real bill and tested each one of them. They all passed the test. They are all aware that I will dock their pay for accepting a fake bill. They also know the many ways to check for a fake bill.

    This fourth bill without a doubt came from this employee's shift. I reviewed security tapes and saw that this employee was not following protocol on how to check for fake bills. It was so obviously a fake that I don't know how she didn't catch it (it was Abe Lincoln's face in the watermark on a $100 bill). She is disputing that I can withhold the money from her pay for her error. I know I can fire her for not following protocol. What is the law in California for withholding pay from an employees paycheck for this issue.

  • #2
    Patty or DAW can correct me if I'm wrong but to the best of my knowledge it is out and out illegal.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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    • #3
      Agreed. CA has very tight laws on this sort of thing. If the employee files a wage claim, you will lose.

      If you want something more definitive, read chapter 11 of the CA-DLSE Manual. While the entire chapter is legally interesting, I will cite the section most on point.
      http://www.dir.ca.gov/dlse/Manual-Instructions.htm

      11.1.3 Deductions From Wages. The courts in California and the United States Supreme Court have held that deductions from wages in effect allow an employer a self-help remedy which is illegal. (Sniadach v. Family Finance, 395 U.S. 337 (1969). California law was changed in 1970 to conform to the holding in Sniadach. (See C.C.P. 487.02(c)). See also Randone v. Appellate Department (1971) 5 Cal.3d 536 and CSEA v. State of California (1988) 198 Cal.App.3d 374; 243 Cal.Rptr. 602.
      "Reality is that which, when you stop believing in it, doesn't go away".
      Philip K. **** (1928-1982)

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      • #4
        So then how do I hold my employees accountable for stupid mistakes other than firing them, which I don't want to do? She's a good employee otherwise.

        I'm just so tired of getting fake bills. They handle money on a daily basis and should KNOW what a fake bill looks and feels like, especially after I have trained them on it time and time again.

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        • #5
          Originally posted by rbeau View Post
          So then how do I hold my employees accountable for stupid mistakes other than firing them, which I don't want to do.
          Suspend her for a couple of days.

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          • #6
            And if that does not work, then fire them. Problem solved. Or maybe stop taking $100 bills altogether. Maybe have a supervisor review/approve all $100 bills prior to acceptence. I have been at places that refuse all $100 bills, likely for that reason. It is not likely that you are the only vendor in the entire state of CA with this problem. Find out what solution everyone else is using. Maybe give the Chamber of Commerce a call.

            But CA is very clear that if you make an unlawful deduction, that YOU are the one breaking the law. Focus on lawful responses to this very real problem.
            "Reality is that which, when you stop believing in it, doesn't go away".
            Philip K. **** (1928-1982)

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            • #7
              Since you have the tape of the transaction with the fake bill, I hope you are informing the police. Many times when a lot of fakes are in one area it is the same group responsible for all of them.

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              • #8
                Also, please refund the $100 to the cashier. It was an unlawful deduction and you can not use a self remedy deduction, even with their approval.
                It is considered a cost of doing business.

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