If a company merges, can your employer withhold1 week of yoursalary and not pay it until you leaveits employment?

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If a company merges, can your employer withhold1 week of yoursalary and not pay it until you leaveits employment?

My company has merged with another, and in order to get all employees on the same payroll schedule, they are withholding 1 week’s pay, which we will not get until we leave the company. We could cash in vacation or take a loan through the company. Is this legal?

Asked on August 17, 2011 New Jersey

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

No, it is not legal at all. Employees must be paid for working, and in NJ, they must generally be paid within 2 or so weeks of doing the work. (I.e. NJ requires a semi-monthly or biweekly payroll schedule.) Therefore a company may *not* withhold an employee's pay indefinitely. There are legal ways to get everyone "synched up"--furlough employees for a few days, then bring them back at the start of a new pay period; have a partial payroll or shorter pay period to get everyone on the same schedule (you can always pay people *more* often than required); etc. But withholding a week of pay, potentially for years, is not a legal mechanism to accomplish this.


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