Wisconsin Court Permits Employer to Fire Employee for Not Paying Back Overpaid Wages

The Wisconsin Court of Appeals, District II, issues an opinion on June 10, 2010, affirming a decision of a trial court that permitted an employer to terminate or fire an employee for not agreeing to pay it back for amounts that the employer overpaid her. Faraday-Sultze v. Aurora Medical Center of Oshkosh, Inc., __ Wis.2d __, 2009AP2429 (Wis. App. 6/2/2010). Wisconsin law prohibits wage deductions from the wages due or earned by any employee for defective or faulty workmanship, lost or stolen property or damage to property, unless the employee authorizes the employer in writing to make that deduction or unless the employer and a representative designated by the employee determine that the theft is due to the employee’s negligence, carelessness, or willful and intentional conduct, or unless the employee is found guilty or held liable in a court of competent jurisdiction. Wis. Stat. 103.455. Furthermore, an employer may not terminate or fire an employee for refusing to agree to such a deduction. Wandry v. Bull’s Eye Credit Union, 129 Wis. 2d 37, 384 N.W.2d 325 (1986). The court said that the public policy of the statute is to “prevent the employer from arbitrarily deducting hard earned wages at its prerogative.” The court in the Faraday-Sultze matter, however, found that since the employee did not earn the amounts the employer overpaid her, the law does not protect her.

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