Have you ever had an employee not cash a paycheck? What do you do with the uncashed payroll check? Whose responsibility is it to follow up? It can be a confusing situation, but it is important to handle it correctly to ensure compliance with state regulations. 

Here is a quick overview of what to do when a Washington State employee doesn’t cash their paycheck: 

Contact the employee: Start by reaching out to the employee to ask why they haven’t cashed their check. Is it a banking issue? Did they misplace it? Communication can often lead to an easy fix. 

Reissue the check: If the employee lost the check, void the original check and reissue a new one. Keep a record of both checks in your accounting system. 

Unresponsive employee: If an employee doesn’t cash their check after 1 year, it should be reported as abandoned property to Washington State. This is a legal requirement. 

Here are the basic steps to report an uncashed payroll check: 

1. Attempt to notify the employee. Send a letter to the last known address and email. You must file unclaimed property reports to WA State Department of Revenue between 60-180 days after you send these letters.
2. Gather the reporting information, including birthdate and social security number.
3. File the report and submit the payment to the WA Dept of Revenue. You can do this online at ucp.dor.wa.gov. Once this step is completed, you should update your accounting records to reflect that you no longer have a liability due to the employee. The employee will need to contact the state to collect their funds.  

Check out the Washington State Guide to Reporting Unclaimed Property for details. 

Remember! No amount is too little to report, so don’t overlook an uncashed payroll check just because it’s small. 

Get in touch today if you have questions!