Texas Wage Deduction & Paycheck Shortfall Calculator

Under the Texas Payday Law (Texas Labor Code Chapter 61), wage deductions are strictly regulated to protect employees from unauthorized, arbitrary, or predatory wage diversions. An employer may not withhold or divert any part of an employee's wages unless one of three statutory conditions is met under Texas Labor Code § 61.018:

• Ordered by a Court: Court-ordered child support, alimony, bankruptcy orders, or IRS tax levies.
• Authorized by State or Federal Law: Mandatory statutory withholdings such as FICA, Medicare, and federal income tax.
• Written Authorization from the Employee: The employer possesses a signed written authorization from the employee consenting to the deduction for a lawful purpose.

Specific Written Authorization Standards (40 TAC § 821.28)

Many employers ask workers to sign a broad statement on their first day: "I agree that the company may deduct any debts, register shortages, or property damages from my paycheck."

Under 40 Texas Administrative Code (TAC) § 821.28 and Texas Workforce Commission decisions, a valid deduction requires a signed written authorization in clear and specific language, stating the specific lawful purpose and stating a definite dollar amount or clear calculation method. While hire-time agreements can validly authorize predictable items with clear formulas (e.g. uniform maintenance or elected benefits), broad blanket clauses permitting unilateral deductions for unspecified damages or cash shortages at the employer's discretion are unenforceable.

The Federal FLSA Minimum-Wage Floor (29 C.F.R. § 531.35)

Even when an employee provides signed written authorization, federal law creates a non-waivable protective floor: deductions for the employer's benefit or business expenses (uniforms, tools, badges, register shortages) CANNOT reduce a nonexempt worker's effective cash wage below the federal minimum wage ($7.25/hr), nor can they reduce statutory overtime compensation.