Arizona Payroll Laws: Employee Engaging in Illegal Activity While Working

When an employer discovers that an employee is engaging in a crime while working, this creates a number of problems. First, the employer may begin to distrust the employee. Second, the employee may be neglecting his work. And, third, the employee may be opening the employer up to a variety of legal actions. In Arizona, the employer is allowed to fire the employee in most cases, but he may not be able to withhold pay.

Payment

If an employee is committing an illegal act while working, the employer is not automatically allowed to withhold pay. Whether pay can be withheld will depend on a number of factors, including what the employee's contract says; the nature of the offense that the employee committed; whether the employee was neglecting his job while he was committing the activity; whether the employee was formally charged with a crime; and whether the offense puts the employer in legal danger.

Termination

In most cases, an employee will be allowed to be terminated in the wake of committing an illegal crime. If the employee is employed "at will" -- meaning that he is not guaranteed employment over a set period of time -- then the employer can fire him immediately. In addition, if the employer's contract has a clause that forbids illegal activity, this will also allow him to be fired.

Lawsuits

Whether an employee can withhold pay may ultimately be worked out in court. While no Arizona payroll laws specifically relate to the commission of a crime while on the job, employers may be allowed to sue the employee if the commission of a crime left it at risk of a lawsuit or in fact cost it money. Similarly, an employee may sue the employer for wrongful termination if the offense did not legally merit firing.

Considerations

Because of all the variables involved in Arizona law related to the commission of a crime while on the job and the withholding of pay, an employer should be sure to consult an employment lawyer before attempting to alter an employee's pay schedule as punishment for committing an offense during work hours. The attorney will need to examine the employee's contract and be briefed on what the employee did before weighing it against relevant laws.