Iowa Deductions from Pay laws & HR compliance analysis

Iowa Deductions from Pay: What you need to know

Iowa law limits an employer's right to make deductions from an employee's pay. Under the Iowa Wage Payment Collection Law, an employer may not withhold or divert any portion of an employee’s wages unless the employer is required or permitted to do so by state or federal law or by order of a court of competent jurisdiction; or the employer has written authorization from the employee to so deduct for any lawful purpose accruing to the benefit of the employee (IA Code Sec. 91A.5(1)et seq.). Examples of such lawful deductions are:
• Social Security contributions
• State and federal taxes
• Wages being garnished by court order ()
• Wages that the employee has assigned to be paid to a creditor
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The following may not be deducted from an employee’s wages:
Cash shortages. Cash shortage in a common money till, cash box, or register operated by two or more employees or by an employee and an employer. However, the employer and a full-time employee who is the manager of an establishment may agree in writing signed by both parties that the employee will be responsible for a cash shortage that occurs within 45 days before the most recent regular payday. Not more than one such agreement shall be in effect per establishment.
Bad checks. Losses due to acceptance by an employee on behalf of the employer of checks that are subsequently dishonored if the employee has been given the discretion to accept or reject such checks and the employee does not abuse the discretion given.
Breakage and property damage, default of consumer credit, nonpayment for goods or services. Losses due to breakage, damage to property, default of customer credit, or nonpayment for goods or services rendered ...

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Iowa Deductions from Pay Resources

Type Title
Forms Training Expense Agreement
Policies Payroll Deductions (Standard)
See all Deductions from Pay Resources