When Does an Employer have to Pay Final Wages to an Employee Who is Terminated or Quits? Minnesota Rules and Penalties

Minnesota Statutes require that employees be paid promptly upon the termination of their employment. The actual date that payment must be made depends upon whether the employee quit the job or was terminated.

  • If the employee is fired, payment must be made immediately. Minn. Stat. §181.13
  • If employee quits, the employee must be paid by the next payday. Except, that if the next payday is less than five days after last day of work, the employer may pay on the following payday or 20 days after last day of work, whichever is earlier. Minn. Stat. §181.14

If the employer fails to make payment as required by law, the employer may be liable to the employee for penalties. Minnesota statutes provide that if the employee’s earned wages and commissions are not paid within 24 hours after demand by the employee, the employer is in default. If the employer is in default, the employer is liable to the employee for penalties equal to one day of wages for each day beyond the 24 hours that it fails to make payment up to a maximum of 15 days. Wages are determined by using the employee’s average daily earnings. (Note that separate laws apply to penalties for late payment of final wages by public employers).

Wages and commissions are to be paid at the usual place of payment unless the employee requests that the wages and commissions be sent to the employee by mail.

If there is a dispute as to the final wages owed the employee, the employer must pay the undisputed amount. Additionally, if the employee still has property of the employer that the employee has not returned (for example, a laptop or cell phone), the employer has ten days after termination of the employee to audit and adjust the accounts of the employee before the employee’s wages or commissions are required to be paid.

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