Puerto Rico Secretary Of Labor Issues Opinion Regarding Allowed Payroll Deductions Following Hurricanes Irma And María

Author:Mr Rafael Aguiló-Vélez, Erika Berríos and Ana Beatriz Rivera-Beltrán
Profession:Littler Mendelson

On November 10, 2017, Puerto Rico's Secretary of the Department of Labor and Human Resources ("Secretary") issued Opinion No. 2017-002 ("Opinion") addressing allowable deductions from non-exempt employees' pay following hurricanes Irma and María. Many employers have been helping their employees by advancing them funds for emergency needs and have sought advice as to whether payroll deductions allowing employees to slowly repay such advances is a viable option. According to the new Opinion, the answer is most likely "no."

The Opinion clarifies that payroll deductions for non-exempt employees are limited to those listed in Act No. 17 of April, 17, 1931, as amended ("Act 17"). Act 17 regulates the payment of wages, prohibits employers from imposing limits on the way employees spend their wages, and establishes a detailed list of the permissible wage deductions in Puerto Rico. The Secretary emphasized in his Opinion that he cannot add exceptions not listed in Act 17 to the prohibition of deductions from wages, even in emergency situations. As a result, when an employer purchases goods or servicessuch as a generatorfor a non-exempt employee, it cannot recoup the cost through deductions from that employee's wages. This practice is prohibited even if the non-exempt...

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