Alert
March 12, 2023

Some Key Issues Under State Wage Payment Laws for Employers in Light of the Silicon Valley Bank Closure

This survey of state wage payment law issues was created on an accelerated timeline to identify and address some of the key issues for employers that were considering steps to reduce potential exposure for payroll obligations in the wake of the Silicon Valley Bank closure by the FDIC. It appears, based on the recent joint statement by the Treasury Department, the Federal Reserve, and the FDIC, that the immediate need for extraordinary measures to address payroll concerns has passed. Nevertheless, this survey may be a useful resource.

One of the issues addressed in this survey is whether state law imposes restrictions affecting the right of an employer to postpone its payroll date for those employed in that state. Most states require that wages be paid within a certain number of days following the end of a payroll period. Some states require a specified amount of notice in advance of changing a payroll date. Even in those states where it appears that an employer may postpone an upcoming payroll date, albeit generally within a statutory deadline for payment, it would be prudent to provide as much notice as possible, both for employee relations purposes and to reduce legal risks.

This is a preliminary guide. It is not intended to be a substitute for obtaining legal advice based on individual circumstances. Employers should consult with employment counsel before making decisions on a course of action.