Washington law does not prohibit employers from making loans to employees. Consequently, employers may arrange for deductions to be made from an employee's wages to repay the loans. Deductions must be authorized by the employee in writing (oral agreements are not binding), must be included on the statement of deductions provided with each paycheck, and must be clearly recorded in the employer's books and records (WA Rev. Code Sec. 49.48.010, Sec. 49.52.060).
An employer or former employer is still allowed to sue or collect any debt owed by its employees or former employees.