by Rodney L. Bean

In the 1960s science fiction television series Lost in Space (and the more recent Netflix reboot), a space-faring family befriends a robot who protects them from various intergalactic perils. The youngest member of the Robinson family, a boy named Will, corners the robot’s attention much of the time due to his penchant for risk-taking. The robot’s oft-uttered warning, “Danger, Will Robinson,” became one of television’s early catchphrases.

If you are contemplating an unusual deduction from an employee’s paycheck, remember the Robinson family’s robot, and heed his famous warning, because one of the easiest ways for a West Virginia employer to run into trouble is by making an improper deduction from employees’ wages.

Understanding the Landscape

The West Virginia Wage Payment and Collection Act (WPCA) is a pesky little statute that can cause big problems for employers who are unaware of its restrictions. Its provisions are specific and unforgiving, and employers who violate it can be liable for outsized damages. Although the West Virginia Legislature has made the statute a little more employer-friendly over the last decade, it still poses a compliance challenge for many businesses.

Among other things, the WPCA regulates withholding from employees’ pay. The statute divides pay withholding into two categories. The first category is what the statute defines as “deductions.” Deductions include amounts required by law to be withheld (such as taxes), authorized withholding for union or labor organization dues by private employers (but not most government employers), club dues or fees (except by government employers), pension plans, payroll savings plans, credit unions, and any form of insurance offered by an employer. Authorized withholding for these deductions doesn’t require any special documentation to comply with the WPCA.

The second category of withholding is called a “wage assignment.” Basically, this is any withholding from an employee’s pay that doesn’t fall under the definition of a deduction. That sum you withheld from your employee’s pay for his uniform? That’s a wage assignment. So is the amount you withheld for the pack of gum and bottle of soda he charged in your gift shop.

Withholding for a wage assignment is only lawful in West Virginia if it’s supported by a formal document, called an “Assignment of Future Wages Form.” The form must contain five essential elements to be valid:

• It must identify the total amount due to and collectable by the employer through withholdings;
• It must state that the assignment won’t be in effect for more than one year;
• It must state that three-fourths of the employee’s wages are exempt from the assignment;
• It must show the assignment was accepted and signed by the employer; and
• It must be signed by the employee.

Until 2021, the WPCA also required that the form be notarized. The WPCA was amended to get rid of the notarization requirement, but prudent employers should still have the forms notarized whenever possible.

Compliance with these elements is mandatory. West Virginia courts have held time and time again that in the absence of any one of these requirements, the assignment is invalid and unenforceable, and the wage withholding is illegal.

Good Deeds Get Punished

Sometimes employment laws provide room for creative solutions. But get too cute with wages, and you’ll often find yourself in a legal mess—even if you were just trying to help an employee.

Reported cases under the WPCA chronicle many situations in which employers were trying to make life easier for their employees by allowing certain purchases or loans to be charged against wages to be paid in the future. Those employers didn’t fare well in the courts.

In a recent case, an employer allowed an employee to use the company credit card to make small personal charges (a CB radio for his personal vehicle, a winter coat, and a meal for his family). The employer then allowed the employee to repay the debt over time through payroll withholding. This arrangement was found to have violated the WPCA because the employer’s attempt at documenting the withholding didn’t have the required elements.

The employer did document the transaction, but the form didn’t contain the mandatory components. It was never signed by the employee, wasn’t limited to one year, didn’t specify the total amount due to the employer, and didn’t say that three-fourths of the employee’s wages would be exempt from deductions.