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Connecticut maintains some of the strictest final pay requirements in the nation. When employment ends, employers face rigid statutory deadlines. Miss them, and the potential consequences multiply quickly: Double damages. Criminal penalties. Class action exposure. The law is clear — even if many employers remain unaware of the requirements, or penalties.

The Statutory Framework

Connecticut General Statutes Section 31-71c establishes three distinct final payment timelines depending on how employment terminates:

• For discharged employees, the deadline is absolute: all wages must be paid by the next business day following termination. Not the next pay period. The next business day. Fire someone on Thursday, the check must be received by Friday.
• Employees who resign may have to wait a bit longer. Their final wages must arrive by the next regularly scheduled payday. The same rule applies to layoffs and labor disputes. But the distinction matters less than people think. Both deadlines are non-negotiable and both carry identical penalties for violations.

Note that “final wages” include more than just the amount owed for the last pay period. Indeed, employers must account for the following: regular pay for hours worked; overtime at time-and-a-half for anything beyond forty hours; earned commissions; and accrued vacation time (if company policy calls for payment of unused vacation upon termination). The Connecticut Department of Labor may determine that an unwritten policy is sufficient to establish vacation pay obligations — or, if the policy has been applied unevenly or inconsistently, to even establish a pattern of potentially discriminatory, disparate treatment. 

Penalties: Civil and Criminal

In 2015, Connecticut enacted Public Act 15-86 and, in doing so, dramatically changed the final pay law penalty structure. Previously, courts required proof of bad faith before awarding double damages; the employer who made an honest mistake faced only single damages.

Since 2015, however, double damages are the default remedy. If an employer fails to pay wages when due, employees recover twice the full amount owed, plus attorney fees and court costs. The only defense is a good faith belief that the underpayment complied with law. Courts interpret this narrowly. Ignorance does not qualify; uncertainty about legal requirements does not qualify. Rather, good faith requires active steps to learn what the law demands, and then documented efforts to comply. It is not an easy defense to establish.

Criminal exposure for nonpayment or untimely payment adds another level of risk for employers. While perhaps unlikely to be pursued, criminal liability attaches to final wage payment violations, and may be exercised to bring maximum pressure on recalcitrant offenders.

Class Action Exposure

Individual claims multiply when employers apply the same illegal pay practices across their workforces. When every terminated employee receives their final check late, the exposure compounds. One violation becomes dozens; dozens become hundreds, and plaintiffs’ attorneys have begun devising novel damage calculation formulas pertaining to the lost opportunities suffered by plaintiffs when employers do not provide timely final pay.

Indeed, Connecticut plaintiffs’ firms are currently pursuing class actions against employers who failed to pay final wages promptly. Lawsuits are targeting businesses across multiple industries.

Massachusetts employers face even stricter standards. Massachusetts requires final wages on the date of discharge itself, not the next business day. Triple damages apply automatically. Connecticut employees working for Massachusetts-based employers may pursue claims in either jurisdiction, selecting whichever offers more favorable remedies.

Additional Compliance Requirements

Employers cannot deduct from final paychecks without proper authorization. C.G.S. Section 31-71e permits deductions only for items required by law (taxes, garnishments), items authorized in writing on forms approved by the Labor Commissioner, and certain employee-requested deductions for medical benefits or retirement contributions. Employers may not withhold wages for unreturned equipment, training costs, uniform expenses, or customer walkouts. Lawsuits may be used to recover such amounts, but paycheck deductions may not.

Connecticut law also requires employers to provide terminated employees with a written notice documenting the termination. The notice must state that employees who disagree with its contents may submit a written statement explaining their position, which then becomes part of the personnel file. Any transmittal of termination information to third parties (such as potential future employers) must include the employee’s statement, if one was given.

The Bottom Line

Connecticut employers must treat final pay deadlines as absolute. Fire someone on Monday, pay them by Tuesday. No exceptions. No grace periods. The alternative is double damages, potential criminal charges, and class action exposure that can transform individual oversights into enterprise-threatening liability. The Department of Labor investigates aggressively. Plaintiffs’ attorneys pursue collective actions enthusiastically. Courts award double damages routinely.

Smart employers must build compliance into their systems. In particular, payroll processes must accommodate same-day or next-day final checks. Managers need training on termination procedures. HR must track vacation accruals and understand when they must be converted to wages. Spending time and money on new or additional compliance measures may be frustrating, especially when those measures do not generate an immediate or obvious return on investment, but employers should always remember: an investment in compliance costs far less than the penalty for getting it wrong.

If you believe you need assistance either in dealing with a claim as described above, or in setting up systems and procedures to protect against potential claims, please contact an attorney in Pullman & Comley’s Labor, Employment Law, and Employee Benefits Department.