Yield the right of way to the FLSA

Q       If an employee caused damage to a customer’s vehicle, can we deduct the cost from the employee’s paycheck without special consent?

Although there isn’t a Mississippi law governing this question, the federal Fair Labor Standards Act (FLSA) prohibits making deductions from nonexempt employees’ pay if doing so would reduce them below minimum wage. Employers could, however, make limited deductions per paycheck for an extended period of time until the full amount is recouped as long as no deduction drops the employee below minimum wage in a given week. 

How much could be deducted in a given week would be a function of how much per hour above the minimum wage the employee is paid. If the employee is paid minimum wage, then there would be no way to recoup the cost of the damage via payroll deductions without violating the FLSA.

For exempt employees’ pay, there are allowable deductions in a limited set of specifically enumerated situations. Recouping the cost of damage to a customer’s vehicle doesn’t fall within one of those situations. So, if deductions were made, the employee would lose exempt status and would become entitled to overtime pay for hours worked over 40 in a workweek.