Termination pay is riddled with potential problems, as a recent federal district court case shows.

In Garcia v. Wal-Mart, an employee clocked in for work and a few minutes later was called into a meeting with his supervisor, where he learned of his termination. He then left the premises, and his co-worker clocked him out an hour after he had arrived.

All told, the employee worked between 20 minutes and one hour on his last day.

To complicate matters, the company had a policy of issuing reporting time, typically four hours, on an employee’s termination date.

The company told the court it had paid the former employee’s termination pay on time: four hours of reporting time, along with the regular and OT hours he had put in during that pay period.

However, the former employee’s lawsuit hinged on the fact that he received a check two weeks after his last day. That check amounted to $12.19—one hour of regular earnings and 0.1 hour of accrued paid time off.

The court didn’t dismiss the case. Reason: The company couldn’t prove the former employee’s termination pay was based on the reporting time, as opposed to the clocked-in time.

In your workplace, how well do supervisors understand your termination pay procedures? You may need to clarify if and when reporting time should be utilized on someone’s last day.