Unlawful Deductions - The Right

Key Points

  • An employee is entitled to receive remuneration for work undertaken and the general principle is that he/she has a right not to be suffer unauthorised deductions to the same.  This right is protected in the Employment Rights Act 1996.
  • If an employer reduces or fails to pay wages without agreement in writing this amounts to an unlawful deduction from wages even if the employee owes money to the employer. In other words, the employer is not entitled to take the law into his own hands.
  • The Employment Rights Act 1996 s 13(1) states that it is unlawful for an employer to deduct wages unless:
    • It is required or authorised by statute or a relevant provision in the workers contract; or
    • The worker has given written consent.
  • There are several exceptions to the rule which are contained in The Employment Rights Act 1996 s 14; such as: employers are entitled to deduct PAYE tax and National insurance, they are entitled to recover overpaid wages made in error.
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