29 C.F.R. § 531.35 “Free and clear” payment; “kickbacks.”
Title 29 - Labor
Whether in cash or in facilities, “wages” cannot be considered to have been paid by the employer and received by the employee unless they are paid finally and unconditionally or “free and clear.” The wage requirements of the Act will not be met where the employee “kicks-back” directly or indirectly to the employer or to another person for the employer's benefit the whole or part of the wage delivered to the employee. This is true whether the “kick-back” is made in cash or in other than cash. For example, if it is a requirement of the employer that the employee must provide tools of the trade which will be used in or are specifically required for the performance of the employer's particular work, there would be a violation of the Act in any workweek when the cost of such tools purchased by the employee cuts into the minimum or overtime wages required to be paid him under the Act. See also in this connection, §531.32(c).
Title 29: Labor
PART 531—WAGE PAYMENTS UNDER THE FAIR LABOR STANDARDS ACT OF 1938
Subpart C—Interpretations
How Payments May Be Made
§ 531.35 “Free and clear” payment; “kickbacks.”
