CSLB Law & Business ExamEmployment RequirementsEasy
A contractor terminates an employee's employment on a Tuesday afternoon without prior notice to the employee. Under California Labor Code Section 201, when must the employer pay all wages due to the terminated employee?
- AImmediately at the time of termination
- BWithin 30 days of the termination
- CWithin 72 hours of the termination
- DOn the next regularly scheduled payday
Show answer & explanationAnswer & explanation
Correct answer: A. Immediately at the time of termination
Labor Code Section 201 requires that when an employer discharges an employee, all wages earned and unpaid are due and payable immediately at the time of termination. This differs from the rule for employees who quit without notice, who must be paid within 72 hours.
Why the other options are wrong
- B. A 30-day delay would subject the employer to waiting time penalties.
- C. The 72-hour rule applies to employees who quit without notice, not to employer-initiated terminations.
- D. Waiting for the next payday violates Section 201 for discharged employees.
Final Paycheck – Termination
When an employer discharges an employee, all unpaid wages are due immediately at the time of termination under Labor Code Section 201.
- Discharge = immediate payment
- Quit with notice = payment at time of quitting
- Quit without notice = payment within 72 hours
Memory trick: Fired means paid right then; quit means a countdown starts.