Can the boss dock wages when an employee owes money?

An employee failed to attend a work-related course paid for by the employer, so the employer decided to take the fees out of the employee’s wages.  The employee noticed that their wages were lower than normal, and asked for an explanation.  The employer explained that the fees for the course had been deducted.

Is this permissible?

The answer depends on whether the employee had provided their written consent.

That may be the case if the employee had agreed to deductions by signing any of the following documents:

1. An employment agreement which stated the employer could deduct fees from wages where the employee failed to attend courses, and agrees to the deduction at the time the deduction is made;
2. A letter or form to the same effect;
3. An agreement or acknowledgment form relating to the training, which stated the employee would repay the employer through deductions from wages.

If nothing like that happens, the employer generally has no right to deduct money from wages.

Even if consent has been given, the employee can revoke that consent in writing at any time.  The employer would then need to stop making deductions as soon as practicable, or within two weeks.

There are some circumstances where the employee’s consent is not necessary, including:

• Where the employer has made an overpayment of wages (although the employer still must let the employee know before the overpayment is actually deducted);
• Where a Court directs a deduction be taken; and
• Where the deduction is required by law (for example, for tax, child support, or for repayment of a student loan).

Where an employer takes too much, or without written authority at the time, the employee can complain to the Labour Inspectorate, or take a case to the Employment Relations Authority if the matter is not resolved by discussion/negotiation with the employer.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.