Unclaimed Paycheck – Fact Check

Each year, millions of dollars in lost or unclaimed paychecks have left employers wondering what they can and cannot do. Here are the answers.



Each year, millions of dollars in lost or unclaimed paychecks are turned over to state departments nationwide. Whether the employee lost the check or simply neglected to pick up the final paycheck, unclaimed funds are legally classified as abandoned property that create sticky situations for employers. Here are some common questions about unclaimed paychecks and what employers should do.

Q: Can I (the employer) "keep" a paycheck that isn't cashed?
A: No. Once an employee has earned wages of any amount, those wages are rightful property of the employee that must be paid. If an employee has not collected the final paycheck, you must try to contact the employee and document all attempts of contact. When the employee is unreachable via phone, send a certified written notice (or some other form of documented contact) to the last known address. You must also determine the state law for an “abandonment period” for monies not cashed and adhere to that law for timing of when to turn over the paycheck to the state department overseeing unclaimed property.

Q: Can I (the employer) hold onto an employee’s final paycheck until the employee returns all company property?
A: No. Unless you have a document outlining the value of the missing company property and the employee has signed an authorization to have the paycheck deducted for that amount, you cannot legally withhold any amount of pay for time worked. In addition, there are federal and state laws that govern the timeline of when an employee’s paycheck must be issued, whether it be a regular paycheck or a final paycheck, those laws must be adhered to by the employer. Please contact our HR experts for your specific situation.

Q: Would direct deposit or a paycheck debit card prevent unclaimed paychecks?
A: Yes. An automatically deposited paycheck is always the preferred, most secure option to avoid a paycheck from getting lost, stolen, or otherwise neglected. Both of these methods allow funds to be immediately accessible on payday rather than waiting to cash or deposit the paycheck at a bank. Please contact our Payroll Experts to get your employees setup with direct deposit or a debit card option today.

Q: Can an employee get the money from an old, uncashed paycheck issued by a former employer?
A: Yes. They may want to begin by contacting the former employer to see if the original check can still be cashed or even re-issued. If the check is from a previous calendar year, the money may have already been sent to the state’s unclaimed property division, pending that state law. If this is the case, they'll need to contact the state treasurer’s office directly to claim any abandoned property. If they worked in Utah, they can contact the Utah Treasurer’s office online by visiting https://mycash.utah.gov.

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