Paying Workers on Time

From Halachipedia

Mitzva

  1. Paying workers in a timely fashion is a biblical mitzvah.[1]
  2. If an employer completely refuses to pay a worker his wages, in addition to violating Lo Talin, he also violates Oshek.[2] For example, if a business closes, and the employer decides not to pay the last payroll because of the losses, he is in violation of Oshek. [3] Regarding bankruptcy of a corporation, a competent halachic authority should be consulted.[4] See Dina D'Malchusa Dina.
  3. In any case that the prohibition of delaying wages doesn't apply, the positive mitzva of paying on time also doesn't technically apply.[5]
  4. The prohibition of delaying wages only applies on the first day.[6] Some say that this applies even if one intentionally delayed.[7] Similarly, if one was exempt from paying at the time that the wages were due, for whatever reason, the prohibition of bal talin will not come into play in the future either, even if he intentionally delays.[8]In any event, one should pay immediately and any further delay is a violation of a rabbinic prohibition.[9]

Guidelines

  1. No distinction is made between wages owed to a penniless worker who depends on his employer or a wealthy worker who is financially independent.[10]
  2. No distinction is made between small and large amounts of money owed to a worker[11] or the amount of work that it takes.[12]
  3. This prohibition can apply to different types of workers: a salaried employee, a service provider, or a craftsman.[13]
  4. The prohibition can apply to payment for the use of an item.[14]
  5. Partial payments are subject to the prohibition of delaying payment, meaning payments must be made in full when due. Otherwise one would be in violation of Bal Talin[15] Even if the amount is in dispute and they plan to go to Beit Din, the employer must pay the amount that is agreed upon by both.[16]

Timing

At what point would one be in violation

  1. The obligation to pay an employee who works during the day, commences at the beginning of the night, and the employee must be paid by dawn. Conversely, if the employee works at night, the obligation commences at the beginning of the morning, and the employee must be paid by sunset.[17] However, if the employee who works during the day finishes before the day ends, the employee must be paid by sunset, meaning we always follow when the work was completed, irrespective of when it was begun. [18]
  2. Although the technical obligation is to pay by dark, since it is not precisely clear when it first gets dark halakhically, it is best to pay by sunset [19]
  3. When the employee earns a salary at the end of agreed upon periods, the employer must pay by that date.[20]

Payment in Advance

  1. If one pays in advance of the work being complete, one is not in violation of bal talin. According to some poskim, he would then be losing out on fulfilling the mitzva of paying on time. He can stipulate at the time that he gives the money that he is not technically transferring the money until it is due, in order to get this mitzva of paying on time.[21]

Form of Payment

  1. Paying by check would not subject one to any violations, unless the employer stipulates payment by cash and that is the norm in that profession.[22]
  2. Payment with a post-dated check or credit card is not considered valid to avoid bal talin. If the employee consents to this form of payment, one would not be in violation of bal talin, but would still lose out on the mitzva of paying on time. [23]

Exceptions

  1. If the task has been completed, but the item has not been given to the employer/client, the obligation to pay is not yet in effect until the item is turned over to the employer/client.[24]

Payment is not Requested

  1. If the worker has not requested payment, there is no issue of bal talin because this is not considered holding back the wages against the worker's will.[25] However, if the worker stands there waiting to be paid, even if he doesn't explicitly ask for it, that is considered a request for payment. Additionally, if the agreement was to pay by a specific day, the employee does not have to request payment.[26] Some poskim hold that one who withholds payment, even in a case that the employee made no request for the payment, is in violation of a rabbinic prohibition.[27]

Payment is not Expected

  1. If the employee does not expect the payment at the specified period, the employer is exempt from paying on time.[28] Therefore, if there is a chance that one may not be able to pay on time, the poskim advise that he ask for permission to pay a later time, and if the employee agrees, there will be no violation of bal talin. He should still make every effort to pay on time.[29]
  2. If the worker consents to wait for his payment, there is no bal talin.[30] Even if the worker is simply too embarrassed to press, and agrees to wait, there is no bal talin. But he must clearly express this consent.[31]
  3. If a worker takes a job where he knows the employer doesn't pay on time, it is as if he agreed beforehand to accept late payment and there is no issue of bal talin.[32]

Employer Doesn't Have the Money

  1. If the employer does not have the money to pay his worker when the payment is due, there is no issue of bal talin.[33] This means that he doesn't have cash, or money available in a bank account. He would not be obligated to sell his assets.[34]
  2. If one only has a large bill, he must go get change and pay the worker.[35]
  3. If he doesn't have the full amount, but can pay a partial amount, he must do so. If he doesn't use all the money that he has available, he is in violation of bal talin.[36]Even if he is left with a choice of paying this worker or buying food for Shabbat, he must choose paying the worker.[37]
  4. If he can borrow the money easily and be able to fulfill the mitzva of paying on time, this is advisable.[38]
  5. If one knows he will not have the money to pay the worker, he is not allowed to hire him in the first place.[39]

Corporations

  1. Corporations are not subject to the prohibitions of delaying payment.[40] Managers are also not subject to this prohibition unless the wage is being withheld for personal purposes.[41]

Precedence

  1. If one has enough money to pay only one of his workers, he should pay the poor worker first.[42] There is a greater responsibility to see that a poor worker gets paid because punishment comes faster if one fails to do so.[43]

Links

Sources

  1. ↑ Sefer Hachinuch Mitzva 588, Shulchan Arukh Choshen Mishpat 339:1. The Sema 339:1 explains that the Talmud (Bava Metzia 111a) derives this from the verse, “At his day you shall give him his hire, nor shall the sun go down upon it; for he is poor and sets his heart upon it; lest he cry against you to the Lord, and it should be sin to you” (Devarim 24: 15).
    While the Gemara Baba Metzia 111a mentions that there are potentially five biblical prohibitions in delaying pay (Rashi), the Sema notes that the Rambam, Tur, and Shulchan Arukh only list one, as five only apply when one does not plan to pay at all (see 339:2). There is also the verse “the wages of he who is hired shall not remain with you all night until the morning” (Vayikra 19:13). Thus this mitzvah is often known as bal talin. It is important to emphasize that the reason for the mitzvah is integral to the mitzvah itself. A guiding factor in this topic should be that people work to make a living, and withholding that living is unfair and immoral, unless, as we will see, the employer and employee operate on consensual terms. see Ahavat Chessed introduction to Perek 9 who bemoans the fact that many people, who are otherwise very ethical, are lax in their observance of this mitzva, and take liberties they would not take in any other area of halacha
  2. ↑ Sefer Hachinuch Mitzva 258, Shulchan Aruch CM 359:8, Halachos of Other People's Money pg. 40
  3. ↑ Halachos of Other People's Money pg. 40
  4. ↑ see Bankruptcy in Halacha from the Business Halacha Institute, Bankruptcy: A Halakhic Perspective by Rabbi Yitzchok Breitowitz, and Bankruptcy - A Viable Halachic Option? by Steven H. Resnicoff
  5. ↑ Halachos of Other People's Money pg. 103 in the name of Rav Elyashiv
  6. ↑ Shulchan Aruch CM 339:8.
  7. ↑ Aruch Hashulchan 339:10
  8. ↑ Halachos of Other People's Money pg. 103
  9. ↑ Shulchan Aruch CM 339:8 based on Gemara Baba Metzia 110b citing the verse “Say not to your neighbor, Go, and come back, and tomorrow I will give, when you have it by you” (Proverbs 3:28), Halachos Of Other People's Money pg. 104
  10. ↑ Halachos of Other People's Money pg. 96
  11. ↑ Ahavat Chesed introduction to Perek 9, Halachos of Other People's Money pg. 97. see there pg. 104 where he writes that some poskim rule that it applies to even less than a perutah
  12. ↑ Ahavat Chesed 9:3 based on Baba Metzia 111b, Halachos of Other People's Money pg. 104
  13. ↑ Shulchan Aruch 339:1 based on Baba Metzia 111a, Halachos of Other People's Money pg. 104
  14. ↑ Halachos of Other People's Money pg. 104
  15. ↑ Ahavat Chesed, 9:10, Halachos of Other People's Money pg. 105
  16. ↑ Halachos of Other People's Money pg. 105
  17. ↑ Shulchan Arukh 339:3
  18. ↑ Ahavat Chesed 9:2, Halachos of Other People's Money pg. 102. While Shulchan Aruch 339:3 writes that one who works during the day can be paid all night, the Rama there clarifies that this is only if his work continues into the night. This is clear from Shulchan Aruch 339:4 who states that if someone only worked a few hours during the night, he must be paid by dawn.
    The Gemara Baba Metzia 111a says he has until the end of the night, and Rashi there (D"H Sechir Shaot) explains that this means until dawn, Amud Hashachar
  19. ↑ Rabbi Ari Marburger, Business Halacha, p. 176). see Ahavat Chesed 9:1 who writes that since status of the time between sunset and tzet hakovachim is unclear, we should be strict and be sure to pay before sunset
  20. ↑ Business Halacha, p. 176.
  21. ↑ Halachos of Other People's Money pg. 108. see note 46 there where he quotes from Shu"T Teshuvot Vihanhagot that the Chofetz Chaim would be sure to only pay the carriage driver at the end of the trip because he wanted to fulfill the mitzva of paying on time
  22. ↑ Business Halacha, p. 186-187. There is a discussion among poskim about whether or not the bank has to be open in order for the prohibition of delaying payment to not be in effect (see Rabbi Moishe Dovid Lebovits, Halachically Speaking, Volume 4, p. 373-374).
    see also Halachos of Other of Other People's Money pg. 106-107 who distinguishes between Eretz Yisrael where a check can more easily be exchanged for cash and America where it can only be brought to a bank, although he acknowledges that in many circumstances the accepted practice is to pay by check and therefore bal talin wouldn't apply.
  23. ↑ Halachos of Other People's Money pg. 107-108
  24. ↑ Shulchan Arukh Choshen Mishpat 339:6.
  25. ↑ Shulchan Aruch CM 339:10 based on Baba Metzia 112a, Halachos of Other People's Money pg. 111
  26. ↑ Halachos of Other People's Money pg. 112
  27. ↑ see Ahavat Chessed 9:11, and Halachos of Other People's Money pg. 112
  28. ↑ Shulchan Arukh Choshen Mishpat 339:9-10. For example, if the employer is up front that he/she is unable to pay immediately and the employee consents, the employer does not need to pay at the end of the period.
  29. ↑ Halachos of Other People's Money pg. 110 based on Shach 339:2
  30. ↑ Halachos of Other People's Money pg. 112-113. see note 61 there where he proves that this is the case even if the work was already completed and the time to pay has arrived
  31. ↑ Halachos of Other People's Money pg. 113 in the name of Rav Elyashiv and Rav Zalman Nechemia Goldberg
  32. ↑ Shulchan Aruch 339:9 based on Baba Metzia 111a, Halachos of Other People's Money pg. 113
  33. ↑ Shulchan Aruch 339:10 based on Baba Metzia 112a, Halachos of Other People's Money pg. 114
  34. ↑ Halachos of Other People's Money pg. 114. see there where he does qualify this statement, that if he has marketable assets that can be sold without a loss, he must do so to pay this worker
  35. ↑ Halachos of Other People's Money pg. 115
  36. ↑ Ahavat Chesed 9:10, Halachos of Other People's Money pg. 115
  37. ↑ Halachos of Other People's Money pg. 115, Biur Halacha OC 242: Lichavod
  38. ↑ Halachos of Other People's Money pg. 116, Aruch Hashulchan 339:14
  39. ↑ Ahavat Chesed 10:!2, Halachos of Other People's Money pg. 114
  40. ↑ Business Halacha, p.184.
  41. ↑ Business Halacha, p. 185, based on Mishnas R’ Aharon (Volume 2, Responsa 73:3). Rabbi Marburger notes, though, that a manager is responsible so long as he or she has the ability to pay; the manager need not use personal money if the company funds are not available.
  42. ↑ Ahavat Chesed 10:8, Halachos of Other People's Money pg. 97 based on Gemara Baba Metzia 111b
  43. ↑ Halachos of Other People's Money pg. 97
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