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Five deductions you CAN legally make from your employee's salary

by , 22 January 2014
Does your employee owe you money? Be careful, you can't just deduct it from his salary! You need to know when, how and how much you can legally deduct or you could find yourself fighting a losing battle at the CCMA. Read on to discover the five instances where it's legally acceptable to deduct money from your employee's salary.

According to the Labour Law for Managers Loose Leaf Service, Section 34 of the Basic Conditions of Employment Act (BCEA) says you can only take money off your employee's salary if he agrees to it, or if you legally have to.

This will be in the form of a collective agreement, court order or arbitration award.

Here are the five instances where it's legal to deduct money from your employee's salary

You can deduct:

  1. Tax from your employee's salary to pay the South African Revenue Services (SARS). This is according to the Income Tax Act.
  2. A percentage of his salary towards the Unemployment Insurance Fund. This is a legal requirement of the Unemployment Insurance Contributions Act.
  3. Union subscriptions in line with a stop order signed by your employee. You'll then pay this amount over to the union.
  4. Medical aid and retirement fund contributions, if it's in your employment contract. You'll pay these amounts to the fund.
  5. An amount if you have an agreement with your employee, or in terms of a court order. For example to pay back a study loan or a garnishee order. You can, and in some instances have to by law, deduct these amounts from an employee's salary. He won't be able to object.

That's not all.

Another instance when you need to make a deduction is if you overpay your employee by mistake. You can ask him to pay this money back. But, you can't just deduct the overpayment from his salary; you still have to get his permission.

It's advisable that you make this deduction as soon as possible so your employee doesn't have the chance to spend the money.

Knowing when you're legally allowed to deduct money from your employee's salary will help ensure you don't find yourself at the CCMA.

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Urgent HR warning:
You WILL land up at the CCMA if you incorrectly deduct money from your employee's salary


Knowing what you can or can't deduct from your employee's salary can be confusing...

Once false move can cause you to land up at the CCMA and pay for the legal fees too!
But it doesn't have to be the fate of your company.

You can legally deduct money from your employee's salary starting today. Here's how...

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