Payment of Wages: Iowa

Federal law and guidance on this subject should be reviewed together with this section.

Authors: Stuart R. Buttrick and Tareen Zafrullah, Faegre Drinker Biddle & Reath LLP

Summary

• The term wages is specifically defined in the Iowa wage payment law. See Definition of Wages.
• Under the Iowa Wage Payment Collection Law, an employer may pay wages in cash or by check. Employees also may be paid by direct deposit or electronic paycard if certain conditions are satisfied. See Wage Payment Methods.
• Iowa employers must pay employees on a monthly, semimonthly, or biweekly basis. Paydays must occur no more than 12 days after the pay period ends. See Pay Frequency.
• With the consent of employees, Iowa law allows employers to make various deductions from employees' pay. See Permitted and Prohibited Wage Deductions.
• With each payment of wages an employer must provide each employee with a pay statement, either at the normal workplace during normal work hours or by mail. An employer may provide pay statements by secure electronic transmission or other secure electronic means under certain conditions. The pay statement requirement may also be met by giving employees access to view and freely print their statements electronically. See Pay Statement Requirements.
• Certain employers must provide a written notice to new employees when they are hired informing them of their wages and the employer's regular paydays and when the information changes. See Employee Notification Requirements.
• Employers must pay terminating employees no later than the next regular payday. See Final Pay.
• Iowa's general estates law may apply to an employer who owes wages or other property to a deceased employee. See Deceased Employee Wages. 
• Wages that are unclaimed for one year are considered to be abandoned. Employers must file an annual report of unclaimed wages with the state and notify affected employees. Penalties are imposed for noncompliance. See Unclaimed Wages.