What employers should do with a deceased employee’s paycheck

Q           We have an employee who recently passed away. He wasn’t married, didn’t have a will, and didn’t have company life insurance or death benefits. How do we handle his final paycheck? Do we continue with our regular payroll procedures, should we wait for the beneficiary for his estate to be identified, or something else?

Ultimately, this question is controlled by state law, which means the answer will vary between states. In this scenario, where an employee has died before his final paycheck has been issued, most states have enacted specific laws whereby an employer can issue the decedent’s final paycheck to either the designated beneficiary of the estate, the decedent’s surviving spouse, the decedent’s children, or other surviving family members of the decedent, even if a formal probate proceeding hasn’t been initiated.

Idaho hasn’t enacted such a law for payroll purposes. However, you still need to continue with your regular payroll procedures and should issue the check in the name of the employee’s estate (i.e., Estate of [Employee’s name]).