- advertisement -

-- Posted: Nov. 30, 1999

Dorothy Rosen -- The Dollar Diva Ask the Dollar Diva

My paycheck is always late

Dear Dollar Diva,
I recently started a new job at a small company. Everything is fine except that my paycheck is consistently late. My contract states that paychecks will be mailed out by the 7th of each month, but this has not been the case. I talked with other employees and found that this is an ongoing problem. I'm wondering if there is a law regarding the right of employees to receive payment for services on time. Any input would be appreciated. Thank you!

You have a contract with this company, and if it doesn't do what it said it would do when it signed the contract -- like mail your check out by the 7th of each month -- it's breaking the contract.

So sue 'em. But wait -- what's your actual monetary loss? And let's get real here. Bosses hate getting sued by employees, and there are sure to be repercussions!

Diva rule
Payroll checks should be delivered on time.
Any exception is a red flag.

What you need to worry about: Why are the checks late?

Even with just a few employees, it's almost always more cost effective to out-source payroll.

  • Is your company out-sourcing? If so, the checks are being spit out on time. So why aren't they being mailed on time? Poor management? Indifference to employees? Cash flow problems?

  • Is your company doing payroll in house? Why? They're not doing a good job. Is it poor management, cash flow problems, or a disregard for the importance of paying employees on time?

What are your options? Read on.

You love the job and are learning a lot, and it will be easy to find another job if this company folds:

  • Live with the late checks like everyone else, and don't worry about it, or

  • Talk to your boss, and ask him what's with the late checks. If he gets huffy, drop it. If he doesn't, ask him if a letter sent to him or the payroll person requesting that your check be mailed on time in accordance with the contract would be a good idea. Maybe no one ever made a formal request for on-time checks, and that's all it will take to make it happen.

  • Suggest that your company offer direct deposit of payroll checks into your personal checking account. It's extremely easy to set this up, and everybody's doing it. If they won't -- why not?

- advertisement -

In the meantime, start saving some money from each late check, so if the company goes belly up you don't have to take the first job that comes along in order to pay your rent.

You're worried that you'll have a hard time finding a new job if this one doesn't work out:

  • The Diva doesn't trust companies that mess with employees' pay. Keep your eyes open for a new job, and when a good one comes along, take it.

  • Figure out your bare-bones living expenses for the next three to six months, and start saving now.

top of page
See Also
Financial advice glossary
More Dollar Diva columns

30 yr fixed mtg 4.22%
48 month new car loan 3.22%
1 yr CD 0.69%

Mortgage calculator
See your FICO Score Range -- Free
How much money can you save in your 401(k) plan?
Which is better -- a rebate or special dealer financing?

Begin with personal finance fundamentals:
Auto Loans
Credit Cards
Debt Consolidation
Home Equity
Student Loans

Ask the experts  
Frugal $ense contest  
Form Letters

- advertisement -
- advertisement -