Legal definitions vary by state
Most U.S. states permit employers to recover wage overpayments without needing prior authorization from employees, classifying these errors as wage advances under state law, explained Crotty. While employers typically require written consent to deduct non-mandatory amounts from paychecks, overpayments are often exempt from this requirement.
However, Crotty emphasized that employers must still adhere to federal and state minimum wage laws, ensuring that deductions do not reduce pay below legal thresholds. Though, the legal definition of wage advances can vary from state to state.
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