Jason Thistlethwaite
29 lines
2.1 KiB
Markdown
29 lines
2.1 KiB
Markdown
## Wage Deductions
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In general, manditory wage deductions are not a valid form of corrective action. Wages can only be deducted from an employee's check in limited circumstances.
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## Voluntary deductions as a corrective action
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In some cases, like if an employee breaks or loses equipment, it might be tempting to deduct the replacement cost from their pay. In most cases that's not permitted by labor laws except where the employee agrees to it in writing.
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## From a lawyer's website:
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> This text is copied from https://www.davidsonmorris.com/can-you-make-an-employee-pay-for-damages/
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The law sets out specific situations where an employer is allowed to automatically make deductions from an employee’s wages. Wages can be automatically deducted where it is:
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- Permitted by legislation/statute such as National Insurance (NI) contributions, or student loan repayments
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- Set out in the employee’s contract of employment
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- The employee has given their written consent
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- Because of an [overpayment of wages](http://www.davidsonmorris.com/overpayment-of-wages/)
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- As a result of the employee taking part in industrial or strike action
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- To fulfil the terms of a court order or to a public authority
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This is a finite list and does not allow for any deductions that have not been previously discussed or agreed with the individual. This includes cases of theft, failure to return a uniform, property damage, or failure to return company equipment.
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Additionally, if there is a contractual clause allowing deductions, or the employee gives written consent, deductions made cannot reduce the employee’s wage sufficient for it to fall below the national minimum wage, unless:
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- The deduction is because of NI contributions or income tax.
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- It is a repayment of an advance of wages or a loan.
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- It is repayment of an accidental wages overpayment.
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- The employee is buying share options or shares in the company.
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- If the employee has caused damage and their contract of employment allows for the deduction (retail workers have additional protections limiting deductions of more than 10% of their gross wage).
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