It has long been California law that an employee who does not have a written contract for a definite period must be given his or her wages not later than 72 hours after the employee quits or immediately upon termination, unless the employee has given 72 hours’ previous notice of his or her intention to quit, at which time the wages should be paid upon expiration of the notice. Failure to do so can result in waiting time penalties up to one month’s wages.
Less clear in the law were an employer’s responsibilities and liabilities for waiting time penalties if an employee retires upon reaching retirement age or the requisite time served in the employ of the employer. In McLean v. State Of California (2016) 228 Cal.App.4th 1500, the California Court of Appeals for the Third District was confronted with a State employee who had retired and not received their final wages and benefits on time. The Court acknowledged that the prompt payment statutes apply equally to State employees and held that retirement is a form of “quitting” that requires the employer to pay the retiring employee his or her wages within the 72-hour rule to avoid waiting time penalties.
When an employee is near retirement it is in the employer’s best interest to contact legal counsel and an HR professional to assure legal compliance with all of the wage and payment laws applicable to retiring employees.
The information presented is not intended to be, and does not constitute, “legal advice.” Because each situation varies, and only brief summary information is provided here, you should not use this information as a basis for action unless you have independently verified with your own counsel that it applies to your particular situation.
Leave a Reply