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Five legal requirements you must comply with before you deduct your employee's salary

by , 21 May 2013
Does your employee owe you money? Have you tried to get him to pay you back of his own accord with no luck? Find out the five legal requirements you must comply with before you deduct the amount from his salary.

In terms of the Basic Conditions of Employment Act (BCEA), there are standard deductions you're allowed to make from your employees' salary. For example, you can deduct tax from an employee's salary to pay SARS.

But what happens if you your employee needs to repay money he owes you or if you want to fine him for causing your company a financial loss.

Well, 'if you're not expressly required or permitted by law, you can still make deductions from an employee's remuneration if you've met all the following five conditions,' says The Labour Law for Managers Loose Leaf Service.

Five legal requirements for you to make deductions

  1. The employee has caused your company to suffer damage or loss. For example, your employee has an accident in your company vehicle whilst under the influence of alcohol.
  2. 'The employee has agreed in writing to the deduction from his remuneration of the amount representing the loss or damage suffered by you and that amount is specified in the written agreement,' says the Loose Leaf.
  3. The loss or damage occurred in the course of employment and was your employee's fault.
  4. You've followed a fair procedure and you've afforded your employee a reasonable opportunity to be heard on why the deductions shouldn't be made.
  5. The total amount deducted doesn't exceed the amount representing the actual loss or damage your company has suffered and doesn't exceed a quarter of your employee's remuneration.

Knowing what legal requirements you must follow will ensure you recover the loss your employee has caused while still complying with the law.



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