Knowledge is Power – Legality of Salary Deductions

Not all of us really look at our salary advices or wage slip at the end of the month or week. Sometimes we only become aware of a discrepancy when we receive the sms notification from the bank and realise that the amount is less than what you have anticipated. Knowledge is power, you need to familiarise yourselves with what can and cannot be deducted from your remuneration, that is our weekly/monthly earnings.

Regulation of Deductions

One of two legislations regulates deductions from our remuneration and must be read in conjunction with your Employment Contract. Firstly, should you belong to a Bargaining Council such as the Motor Industry Bargaining Council (MIBCO), is the MIBCO Main Collective Agreement (MIBCO Agreement), clause 5(8), and the MIBCO Administrative Agreement, clause 5. Secondly, should you not fall under a Bargaining Council or in the absence of a signed MIBCO Agreement or Administrative Agreement, is the Basic Conditions of Employment Act 75 of 1997 (BCEA) in section 34.

Both the BCEA and the MIBCO Agreement provides, in its simplest form, three requirements prior to deductions from remuneration, which are:

• Consent from you as employee – You have a say;
• In terms of legislation – You do not have a say, i.e. PAYE, UIF, Provident Fund etc;
• In terms of a signed Collective Agreement (such as the MIBCO Agreement) or in terms of an arbitration award or court order – You do not have a say.

Even though it might seem as if you do not have a say, the very first bullet point gives you control over your salary after all statutory and legal deductions, which is your ‘consent’. Consent is nothing else but your agreement or with your approval.

The MIBCO Agreement is more descriptive and provides for additional deductions with and without consent, such as Council Levies.

In regard to, for instance absenteeism deducted from your remuneration, the Labour Court in Coin Security (Cape) v Vukani Guards & Allied Workers’ Union 1989 (4) SA 234 (C) at 230I held that “A contract of employment is a contract with reciprocal rights and obligations. The employee is under an obligation to work and the employer is under an obligation to pay for his services. Just as the employer is entitled to refuse to pay the employee if the latter refuses to work, so the employee is entitled to refuse to work if the employer refuses to pay him wages which are due to him.”  (Own Emphasis)

The same can be said in the absence of a Contract of Employment when the BCEA or a Bargaining Council Agreement regulates your employment.

Deductions for Damages and Losses Incurred by the Employer

A. BCEA

In terms of the BCEA, section 34 (2) your employer may deduct an amount equal to the damage suffered or the loss incurred by you as a result of negligence or deliberate activities/conduct. The provision is not without certain obligations and your employer cannot merely deduct money from your remuneration. Deductions for the loss or damage are subject to the following criterion:

• must have occurred in the course of your employment;
• must have been as a result of you being at fault;
• you must, through a fair procedure, be given a reasonable and fair opportunity to give reasons why the damage or loss should not be deducted from your remuneration;
• the deduction(s) from your remuneration must not be more than:
  • the real/actual amount of the loss or damage suffered by your employer;
  • 25% of your remuneration on a weekly or monthly basis.

No acknowledgement of Debt is required on a guilty finding.

B. MIBCO Agreement

In terms of the MIBCO Agreement, clause 3.8 (10)(f), your employer may deduct the monetary value of damages to vehicles or property. The deduction is however subject to the provisions of clause 9(3), distinguishing between the following two scenarios. Firstly, damage to vehicles and secondly, the loss of property or assets. In both these scenarios your employer is obliged to hold a formal disciplinary hearing where you have the opportunity to provide reasons on how the damage to the vehicle, or the loss to property or assets, occurred.

Damages to Vehicles:

One of the following misconducts must be proven on a balance of probability:

• having driven the vehicle under the influence of alcohol or drugs;
• negligent driving;
• reckless driving;
• willful damage to the vehicle;
• having driven the vehicle without the permission of the employer.

Only in the instance that if found guilty of one of the above, your employer may deduct not more than 30% of your weekly wage or monthly earnings:

• any excess amount that is already incorporated in an insurance policy;
• damages;
• damages in the absence of insurance cover.

No acknowledgement of Debt is required on a guilty finding.

Conclusion

The right to deduct damages or losses incurred by your employer from your wages or salary is limited. Fairness dictates that your employer cannot make a judgment on your liability without granting you the opportunity to be heard. Don’t be ignorant, scrutinise your wage slip or salary advice to ensure there are no unauthorised or unlawful deduction from your salary. Ensure that your union fees are deducted monthly and remember MISA is just a phone call or an e-mail away!

Kindly utilise the following e-mail addresses and links for assistance during this time: