Tennessee Wage Payment Laws

Frequency of Wage Payments

Tennessee labor laws allow employers with five (5) or more employees to pay employees not less frequently that one (1) time per month. If an employer pays an employee one (1) time per month, the employer must pay the employee all wages and compensation earned and unpaid in a given month not later than the fifth day of the succeeding month.

If an employer with five (5) or more employees pays an employee in two (2) or more periods per month, the employer must pay the employee as follows:

• All wages earned and unpaid prior to the first day of any month must be paid not later than the 20th day of the month following the one in which the wages were earned;
• All wages earned and unpaid prior to the 16th day of any month shall be due and payable not later than the fifth day of the succeeding month.

An employer may pay employees more frequently than twice per month (semi-monthly).

An employer must establish and maintain regular pay days and must post and maintain notices, printed or written in plain type or script, in at least two (2) conspicuous places where the notices can be seen by the employees as they go to and from work, setting forth the regular pay days.

In case an employee is absent from the usual place of employment at the time of the payment of wages, the employer must pay the employee within a reasonable time after the employee has made a demand for the wages.

Tennessee labor laws does not address how frequently employers with fewer than five (5) employee must pay wages to employees.

TN Statute 50-2-103

Manner of Wage Payments

An employer may pay employees by:

• cash,
• check or draft, payable at some bank or other established place of business, without discount, exchange or cost of collection, in cash,
• direct deposit
• payroll card

TN Statute 50-2-103

Direct Deposit

An employer may pay an employee by direct deposit, however, the employee must be able to choose the financial institution with which the deposit is made. There is nothing prohibiting an employer from requiring an employee be paid by direct deposit. TN Statute 50-2-103

Payroll Card

Tennessee labor laws allow employer to pay wages and compensation to employees by payroll card. To pay an employee by payroll card, an employer must:

• give the employee the choice of being paid by direct deposit and have the employee either:
  • explicitly choose to be paid by payroll card or
  • fails to designate an account at a financial institution in advance and as required by the employer for direct deposit
• explain the payroll card system to the employee
• provide full written disclosure of any applicable fees associated with the payroll card
• ensure that an employee being paid by payroll card is able to make at least one (1) withdrawal or transfer from the payroll card without cost to the employee for any amount contained on the card

TN Statute 50-2-103

Payment upon Separation from Employment

An employer must pay an employee who is discharged or terminated or who has quit or resigned all wages due no later than the next regular pay day following the date of dismissal or voluntary leaving, or twenty-one (21) days following the date of discharge or voluntary leaving, whichever occurs last. TN Statute 50-2-103

Employees who are suspended or resigns due to a labor dispute (strike)

Tennessee does not have a law specifically addressing the payment of wages to an employee who leaves employment due to a labor dispute, however, to ensure compliance with known laws, an employer should pay employee all wages due no later than the next regular pay day following the date of dismissal or voluntary leaving, or twenty-one (21) days following the date of discharge or voluntary leaving, whichever occurs last. TN Statute 50-2-103

Wages in Dispute

Tennessee does not have any laws requiring an employer to pay an employee wages conceded to be due when involved in a wage dispute with the employee.

Deductions from Wages

According to the Tennessee Department of Labor & Workforce Development, an employer may only deduct or withdraw wages from an employee’s pay if the employee have given written consent.

Thus, an employer may make deductions from an employee’s wages for the following items only if the employee has consented to it in writing:

• cash shortages
• breakage, damage, or loss of the employer’s property
• required uniforms
• required tools
• other items necessary for employment

TN Dept. of Workforce Dev. FAQ

Uniforms, Tools, and Other Equipment Necessary for Employment

Tennessee does not have any laws prohibiting an employer from requiring an employee to purchase a uniform, tools, or other items necessary for employment.

Pre-hire Medical, Physical, or Drug Tests

Tennessee does not have any laws prohibiting an employer from requiring an applicant or employee to pay the cost of a medical examination or the cost of furnishing any records required by the employer as a condition of employment.

Notice of Wage Reduction

An employer must notify an employee before changing their wage rate. TN Statute 50-2-101

Statement of Wages (Pay Stub)

Tennessee does not have any laws requiring employers to provide employees of notice of wage rates, dates of pay, employment policies, fringe benefits, or other terms and conditions of employment.

Record Keeping Requirements

Tennessee does not have any laws requiring an employer to keep any employment-related documents.

Federal law requires every employer covered by the Fair Labor Standards Act (FLSA) to keep certain records for each covered, nonexempt worker, for at least three (3) years. For more information, visit FLSA.

Notice Requirements

An employer must inform an employee of his or her wage rate prior to the employee performing any work at that wage rate. TN Statute 50-2-101

An employer must post and maintain notices, printed or written in plain type or script, in at least two (2) conspicuous places where the notices can be seen by the employees as they go to and from work, setting forth the regular paydays. TN Statute 50-2-103

An employer may not misrepresent the amount of wages a new hire will be paid. TN Statute 50-2-104