Can I legally charge back an employee for shortages?

UPDATED: Oct 8, 2011

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Can I legally charge back an employee for shortages?

I run a bar and I have some employees that have shortages sometime small and other large. Can I legally charge them for the shortages especially when they can not explain them and I can not find them on the register receipts?

Asked on October 8, 2011 under Employment Labor Law, Minnesota


M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

As long as this type of chargeback is not prohibited by a union agreement or employment contract, and is not done in a discriminatory way (i.e. only women musy pay it), then yes it is legal. However, if this is new company policy you can only do so for shortages going forward; any previous shortages cannot be charged. Also, do not make automatic deductions for an employee's paycheck unless you have their express permission to do so (get it in writng). Without such permission you can still charge them but you will have to do it separately.

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