What can I do to get my money that was to be placed in a FSA by my employer but is now unaccounted for?

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What can I do to get my money that was to be placed in a FSA by my employer but is now unaccounted for?

My employer was to place a set amount of my money from each paycheck into a dependent care account (tax-free). To my knowledge it has not been set up. I have participated in this program for 3 years and have never had an issue. My employer will not give me a straight answer as to where my money is – this has been going on for 3 months. Also, he is continuing to deduct the set amount from each paycheck. Can I ask for the money that is owed to be given to me, in check form, with the appropriate taxes being taken out? Am I just “out” my money?

Asked on August 19, 2010 under Employment Labor Law, Ohio

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Your employer can NOT simply take and keep your money. If it was supposed to go into an FSA, then thhe employer had both contractual and fiduciary obligations to do so; failing to do so is a violation of both. If the employer is taking your money and not giving you access to it, he may be committing some form of theft--which is both criminal and something you could sue over--as well.

The short answer is, you should have recourse. If the employer refuses to pay you what is due to you, you should have grounds to sue and possibly to file charges as well.

In cases like this, there is often financial distress  (the company is using the money to stay afloat or pay other obligations) or theft going on. In either case, the longer you wait, the less likely it is that there will be money to recover. You should speak with an attorney immediatley about your rights and recourse. Good luck.


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