1323. Back Pay

1323.1 What is "back pay"?

"Back pay" is pay you receive in one period for actual employment in an earlier period. Back pay under statute is payment that is required by law, such as the National Labor Relations Act, the Fair Labor Standards Act, and other Federal and State laws. The purpose of back pay is to create an employment relationship or to protect employees' rights to wages.

1323.2 Does back pay count as wages?

Back pay, except penalties, interest, or legal expenses paid under a statute, is wages if it is paid for covered employment. For Social Security purposes, back pay may be assigned to the periods in which it should have been paid.

Back pay not under a statute is wages if it is extra pay for past employment. Back pay not under a statute is not assigned to any period other than the period in which it is paid.

Last Revised: March, 2001