Q: When I’m planning to terminate an employee, should the final paycheck be presented at the time of termination, or can it be given at a later date? Do I have to delay termination until the check is ready to give to the employee?
A: The short answer is that it depends on the location of your business.
The federal government states that employers don’t have to give employees their last paycheck at the point of termination. However, you need to check your state’s policies; some states do require immediate payment.
For example, in California, you are required to deliver the final check (including all unused/accrued vacation/paid time off) at termination. If you can’t deliver a final check, there is a penalty that the employer must pay to the employee for each day late, up to 30 calendar days. If the employee prefers to have the final check mailed to them, you need to have that request made in writing and include any additional penalty fees based on the certified mailing date of the check. California also requires employees be provided with the following information at the point of termination:
- For Your Benefit Brochure, form DE 2320.
- Notice as to Change in Relationship.
- Health Insurance Premium Payment Program flyer (for employers with 20+ employees).
- CAL-COBRA Notice (for employers with 2-19 employees) or COBRA Notice (for employers with 20+ employees).
- Notifications regarding the continuation, extensions and coverage options of programs like disability insurance, Health Savings Account or 401(k).
