Texas Payday Law
The primary Texas state statute (Tex. Lab. Code Chapter 61) governing the timing, frequency, and method of wage payment by Texas employers. Establishes pay-frequency requirements, regulates deductions, sets final-paycheck timing, and provides a TWC wage-claim mechanism, with an administrative penalty for bad-faith nonpayment.
The Texas Payday Law, codified at Tex. Lab. Code Chapter 61, is the primary state statute governing the timing, frequency, and method of wage payment by Texas employers. It establishes pay-frequency requirements, regulates permissible deductions from wages, sets timing requirements for final paychecks at separation, and provides an administrative wage-claim mechanism through the Texas Workforce Commission, with an administrative penalty where the employer acted in bad faith.
Pay frequency
Non-exempt employees must be paid at least twice per month (semi-monthly). § 61.011(b). Employees exempt from FLSA overtime (typically salaried managerial, professional, and administrative employees) must be paid at least once per month. § 61.011(a). Employers must designate paydays in advance and post notice in the workplace. § 61.012.
Final pay at separation (§ 61.014)
Involuntary termination (employer-initiated): wages must be paid within six calendar days of termination. Voluntary resignation (employee-initiated): wages must be paid by the next regularly scheduled payday following the date of resignation.
Permissible deductions (§ 61.018)
Wages may be withheld only when (1) authorized by law (taxes, garnishments, child support); (2) required by court order; or (3) authorized in writing by the employee. Employer "policies" purporting to authorize deductions without specific written employee authorization are insufficient.
Wage claim mechanism
An employee with unpaid wages may file a wage claim with TWC within 180 days of when the wages were due. § 61.051(c). TWC investigates, issues a Preliminary Wage Determination Order, and may order payment and pursue collection. A final order against the employer, unless timely appealed to a court, is a lien on all of its property. § 61.081. Both employer and employee have appeal rights.
Penalties for bad-faith nonpayment
Chapter 61 does not provide treble damages. Under § 61.053, if TWC finds that the employer acted in bad faith in not paying wages, it may assess an administrative penalty on top of the wages, capped at the lesser of the wages in question or $1,000. The same section allows a penalty against an employee who files a claim in bad faith. Under § 61.019, failing after demand to pay wages, with intent to avoid payment, is a third-degree felony.
The Texas Payday Law is the everyday wage-payment statute for Texas employers. Compliance failures, late final paychecks, unauthorized deductions, off-cycle pay schedules, generate routine TWC wage claims and, in bad-faith cases, an administrative penalty of up to the lesser of the wages owed or $1,000. Coordination with FLSA (federal minimum wage and overtime) is critical: claims often involve both Payday Law (timing/deduction) and FLSA (amount) violations.
Practice guide: Employment Law Basics for Texas Employers