May 28, 2013 Leave a comment
If your payroll system is not set up with Direct Deposit then there is a chance that you have unclaimed checks being stored at your office. What do you do with those?
It is a good idea to have an Unclaimed Checks policy in your employee handbook. We list some suggestions for wording below.
1. Determine if the employee is entitled to the check.
2. Make a concerted effort to deliver the check.
3. Hold the check for two weeks.
4. Send check to state unclaimed property
5. If a check is returned after being mailed, specify a period of time where it will be held at the office for pick up before turning it in to the state.
Employers should keep a record of the employee’s name and last known address for a specific time period after the wages become reportable. After the specified time period has lapsed, sending the check to your state’s abandoned/unclaimed property department probably does your former employee a favor. Because many companies do not have a mechanism for holding on to unclaimed property for long periods of time, chances are that at some point the check would be lost or destroyed. However, while abandoned property laws vary from state to state, Washington’s state law *“protects unclaimed property until it can be returned. There is no time limit for filing a claim and rightful owners or their heirs can claim property reported since 1955. The state may auction the content of safe deposit boxes, however, if not claimed within five years.”*
Some other particulars of unclaimed property laws in the Pacific Northwest:
Unpaid wages, including wages represented by un-presented payroll checks, owing in the ordinary course of the holder’s business which remain unclaimed by the owner for more than one year after becoming payable are presumed abandoned.*
Property becomes unclaimed if the owner can´t be contacted by the holder of the asset within a specified period of time. Examples of unclaimed property include savings or checking accounts, uncashed payroll or dividend checks, and safe deposit box contents.
Unclaimed money is held in trust in the Common School Fund forever for claim. The fund’s interest earnings benefit K-12 public schools through biennial distributions to Oregon’s 197 school districts.**
*Source – http://ucp.dor.wa.gov/aboutUCP.aspx