Salon owners often punish their employees through theft in the form of unlawfully docking commissions and punish renters for delinquent payments by “confiscating” their belongings. Are you being robbed by a bad salon owner? Read on to learn more about common ways salon owners steal from their team.
Some states (like California) have very specific laws restricting the docking of wages. Very few states do not have any at all. In those states without laws, refer to applicable federal guidelines, which basically state that as long as you’re making the minimum wage (after the deduction), wage docking is perfectly legal.
In my opinion, this is bullshit.
Pay docking can take several different forms:
Failure to Compensate: The FLSA dictates that covered employers must track hours and employees must be paid the prevailing wage for each hour worked in that pay period. Whether or not the service provider was actually providing a service is irrelevant. They were “engaged to wait,” therefore, the employer is required to pay. Many salon owners operate on a questionably legal commission-only compensation system, failing to ensure their employees are paid the prevailing minimum wage, or any applicable overtime pay.
Deductions as Behavior Modification: This is an example based on an exact situation a user emailed me this week. A salon owner, let’s call her Ms. Bitchface, punishes her tardy employees by taking 15% of their commission from their first service of the day. In states which lack prohibitive legislation against wage deductions, so long as Ms. Bitchface ensures your check equals or exceeds the prevailing minimum wage, it’s legal.
Besides being an asshole move in general, this punishment strategy benefits the wrong person–the owner.
Let’s pretend one of Ms. Bitchface’s employees shows up fifteen minutes late, leaving her client (who had the courtesy to show up on time) waiting on her. Regardless of the reason for the tardiness, this looks unprofessional, sloppy, and could cost the salon that client’s business. The client has been inconvenienced and something needs to be done to rectify that situation to attempt to salvage the relationship. It makes more sense to give the client a 15% discount (taken from the service total) than for the owner to pocket the 15% herself. The client deserves that kickback; not the owner.
Deductions as Punishment for Poor Service Outcome: A client decides she wants a refund, and the salon owner tells you that the money is coming out of your paycheck. Guess what? The same rule applies. If the state or the terms of your employment contract don’t protect you, so long as you’re making at least the prevailing minimum wage for each hour worked in that pay period–it’s generally legal.
An Alternative to Wage Docking
When it comes down to it, docking an employee’s wages for perceived infractions isn’t effective management. It’s legally perilous and causes resentment. Instead, utilize a progressive discipline policy. An employee’s poor performance or bad behavior is your problem, and often (not always), it’s at least partially your fault. Either the employee didn’t understand your expectations, you gave them a task or position they weren’t suited for, or you made a poor hiring choice to begin with. Regardless, it’s your responsibility to correct.
You don’t deserve to pay yourself for your management failures.
Your job is to lead, and a big part of that job is communicating your expectations, correcting employees who make mistakes, and providing guidance. Wage docking is a lazy way out of doing your job; one that inappropriately rewards you for your own bad behaviors instead of incentivizing you to evaluate your level of responsibility and improve as a manager.
How to STOP Wage Deductions
This is where I have to stress the importance of contracts:
If you have an employment contract that specifies your compensation and prohibits wage docking, your employer cannot dock your wages for any reason, no matter what state you’re in.
A solid employment contract is your shield against exploitation. Without one, you’re nothing but a squishy mass of flesh. In addition to having a contract written, follow the tips in my article, Wage Theft: What it is and what you can do about it.
DISCLAIMER: Always check your own state’s laws or consult an attorney before doing or saying anything. Laws change frequently and each state has different protections available to commercial tenants. Key word there: commercial tenants. There are tons of federal and state protections for residential tenants, but commercial tenants tend to get the short end of the stick. To be fair, many states are correcting this.
Your best protection is a properly written lease or employment contract.
…so always read before you sign and negotiate what you do not agree with.
1.) Your landlord changes the lock on your treatment room and takes all of the contents, telling you that you’ll get it back when you pay the rent.
WRONG: The landlord has essentially stolen the tenant’s property. Depending on your state laws, the landlord may have committed theft by conversion, which will typically entitle the tenant to damages and even a civil penalty in court. Landlord’s liens may be legal in certain states (which often only allow it if the contract stipulates it), but I’ve found that this is pretty rare. If a renter is behind on rent, they should be evicted properly and pursued for the amount owed afterwards. Even legally committed lockouts are messy and can be insanely expensive to defend.
2.) You went on vacation without telling your landlord, knowing you were a week behind on rent but swearing to yourself you’d pay it after you hit the jackpot in Vegas. Eight days later, you return to work only to find that your items have all been sold and someone else is working in your place.
WRONG: In many states, if a tenant fails to give a landlord notice of an extended absence or is gone for seven or more days while behind in rent without telling the landlord, the landlord may consider the rental unit abandoned. In that situation, the landlord may enter the rental unit and put the tenant’s property in storage. The landlord should then notify the tenant that the property is being stored, either by mailing a notice to the tenant’s last known address, or the best address the landlord has from the tenant (for example, the tenant’s employer’s address or some other address provided to the landlord in case of emergencies). The notice should say that the landlord is storing the property and intends to dispose of it in thirty days unless the tenant claims it The landlord should make arrangements for the tenant to get the property within that time, but the tenant will be liable for storage costs.
Owners, DO NOT commit theft by conversion. Ever. Never take what isn’t yours. Refer to your state’s “abandoned property” statutes and consult with an attorney before doing anything.
Defending that action could cost far more than it’s worth.
3.) Your lease has ended and you found a cheaper place to rent. A few weeks after leaving, you realize you left some things behind at your old place! You call the landlord only to find that those items have been sold.
LIKELY LEGAL: Check your state’s abandoned property statutes. When a tenant has moved out, typically the landlord must hold all property left behind for at least fourteen days (depending on the state) and give the tenant the chance to claim it. In this situation, the landlord is generally not required to give any notice, so the tenant should check with the landlord no later than ten days after moving out to see that there is no property being stored. If there is, the tenant should claim the property, but the tenant will have to pay for any storage charges.
Owners, do your part before you sell their crap. Protect yourself.
4.) You were evicted by court action, but your stuff is still at your booth. The owner is planning on selling everything without your consent.
WRONG: Depending on state laws, once a tenant has been evicted by a court action, generally the landlord must only hold any property left behind for three days after the date the tenant is forced to move under the eviction order. During that time period (three days, ten days, 24 hours, depending on your state), the landlord must give the tenant reasonable opportunities to come to the property and move his/her belongings. If the tenant and the landlord can reach a private agreement on a longer period to hold the property, the longer period will apply. Any such agreement should be in writing and signed by the landlord. After the time period specified, the landlord does not have to store the property and can dispose of it or sell it at their discretion.
Owners, even if your state permits this, don’t do it without consulting an attorney. It’s bad news for you.
FEES, SALE PROCEEDS, ETC: Depending on the state, landlords may not charge the tenant for anything other than reasonable costs of moving and storing the property left behind unless specified in the lease agreement.
The landlord should not hold the property for security on a debt or judgment without getting a formal execution in court.
However, if the landlord has stored the property and given the tenant the opportunity to claim it, the landlord (in many states) is permitted to dispose of the property after the proper time has run. If the property is left after an eviction, the landlord can typically do anything with it he or she wants, so long as the tenant had the required amount of days after the eviction to claim the property. In all other cases, the landlord’s duties in disposing of the property tend to depend on the value it has, in some states. Check with yours to figure out if any of those limitations exist.
Why don’t you have an attorney on retainer?
Salon owners and salon landlords, please stop seeking legal help after you’ve done something that requires it. Instead, have an attorney guide you through the process of establishing your business. Have them write your contracts and leases (because frankly, you are not qualified to do it yourself). Call on them before you do anything that might be legally questionable and have them advise you so you can avoid costly legal situations. Should you require a reference to an attorney in your state, I’m happy to provide one.