Salary deduction checker

This checker tells you whether a deduction from your salary is allowed by section 34 of the Basic Conditions of Employment Act, and if it is a deduction for loss or damage, how much may lawfully be taken each month. Deductions are one of the most common complaints labour inspectors deal with: money taken for a till shortfall, a damaged vehicle, a broken phone, missing stock, a uniform, training, an advance, or simply "a fine". Most of these are unlawful as made, not because the employer may never recover the money, but because section 34 sets conditions that are rarely met.

It is for employees who have found an unexplained deduction on a payslip, for employees being asked to sign a consent form, and for employers who want to recover a genuine loss without creating a claim against themselves.

What this calculator works out and who it is for

You enter your monthly remuneration in money, the amount deducted or proposed, and which of three categories the deduction falls into: loss or damage, another debt such as a loan, advance, uniform, training cost or overpayment, or a deduction required by law, court order or arbitration award. You then answer whether you agreed to the deduction in writing, whether you were given a chance to explain why it should not be made, and, for loss or damage, what the actual loss was if you know it.

The checker returns a verdict for the category you chose. For a deduction required by law it tells you consent is not needed but a payslip must still show it. For another debt it turns on written consent for that specified debt. For loss or damage it tests each of the section 34(2) conditions in turn: fair procedure, written consent, not exceeding the actual loss, and not exceeding one quarter of your remuneration in money, and it works out the monthly cap and how many months lawful recovery would take.

It is for all employees. Section 34 applies regardless of what you earn; the earnings threshold does not exclude anyone from it.

How the calculation works

The checker begins with the category, because the rules differ. A deduction required or permitted by law, a collective agreement, a court order or an arbitration award is lawful without your consent. That covers PAYE, UIF, a maintenance order, an emoluments attachment order, and contributions to a fund under its rules. The checker's only caution there is section 33, which requires the payslip to show the amount and purpose of every deduction.

For another debt, the only route is section 34(1)(a): you must have agreed in writing to the deduction in respect of a debt specified in the agreement. The checker asks for that one fact and reports accordingly. It also warns about blanket clauses in employment contracts that purport to authorise deductions for any debt that might arise in future; the section speaks of a debt specified in the agreement, and consent signed before the debt existed sits awkwardly with that wording.

For loss or damage, section 34(2) sets four cumulative conditions, and the checker tests each one it can. The loss must have occurred in the course of employment and been due to your fault, which the checker cannot assess and says so. A fair procedure must have been followed, giving you a reasonable opportunity to show why the deduction should not be made. The total amount deducted must not exceed the actual loss. And the total deduction must not exceed one quarter of your remuneration in money. The checker works out the cap by multiplying your monthly remuneration by 0.25. If the deduction is larger than that, taking it in one month breaches the cap even if the other conditions are met, and the checker shows how many months at the capped amount lawful recovery would take. A deduction that fails any one condition is unlawful as made.

The law behind the numbers

Section 34(1) of the Basic Conditions of Employment Act 75 of 1997 provides that an employer may not make any deduction from an employee's remuneration unless, subject to subsection (2), the employee in writing agrees to the deduction in respect of a debt specified in the agreement, or the deduction is required or permitted in terms of a law, collective agreement, court order or arbitration award.

Section 34(2) provides that a deduction in terms of subsection (1)(a) may be made to reimburse an employer for loss or damage only if the loss or damage occurred in the course of employment and was due to the fault of the employee; the employer has followed a fair procedure and given the employee a reasonable opportunity to show why the deduction should not be made; the total amount of the debt does not exceed the actual amount of the loss or damage; and the total deductions from the employee's remuneration do not exceed one quarter of the employee's remuneration in money.

The subsections that follow deal with related points. A deduction made in terms of an agreement for a benefit fund or a third party must be paid over to the fund or person within the time and in the manner the agreement or law requires. An employer may not require or permit an employee to repay any remuneration except for overpayments previously made by the employer resulting from an error in calculating the employee's remuneration, or to acknowledge receipt of an amount greater than the remuneration actually received. Section 34A then deals with payment of contributions to benefit funds.

Section 33 requires that the employer give the employee, on each pay day, a written statement showing among other things the remuneration in money, the amount and purpose of any deduction made, and the actual amount paid. An unexplained deduction is a breach of section 33 even where the deduction itself might have been lawful.

Enforcement follows the Act's general scheme. A labour inspector may issue a compliance order requiring the employer to repay the deduction, at no cost to the employee. An employee earning below the earnings threshold may refer a claim for an amount owing under the Act to the CCMA under section 73A for arbitration, and the arbitrator may order payment. An employee above the threshold claims in the Labour Court or a civil court. Making a deduction the Act prohibits is also an offence.

Two points from the case law are worth having in mind. Courts have treated the consent requirement seriously: consent must be to a specified debt, and an employer that relies on a general clause signed on appointment takes a risk. And a deduction for loss or damage requires fault to be established through a fair procedure, not assumed; an unexplained till shortfall in a till used by several cashiers, or stock that went missing from a store with many staff, will seldom satisfy the requirement that the loss was due to this employee's fault.

Worked example

Kagiso earns R8 000 a month as a driver. He reverses the company bakkie into a gate and the repair costs R3 000. The employer holds a meeting, hears his explanation, decides the damage was his fault, has him sign an acknowledgement of the R3 000 debt, and deducts the full R3 000 from his next pay.

The checker places this under loss or damage. Fair procedure: yes. Written consent: yes. Actual loss R3 000, deduction R3 000, so the deduction does not exceed the loss. The cap is one quarter of R8 000, which is R2 000. The deduction of R3 000 exceeds it. The headline reads that the deduction is not permitted as made, with one of the section 34(2) conditions failing, and the lines show a lawful recovery schedule of two months at up to R2 000. The warning adds that the debt itself may be recoverable, but only in instalments within the cap. Kagiso is entitled to R1 000 back from the first month's pay, and the employer may take the balance of R1 000 the following month.

Change one fact: the employer never held a meeting and simply deducted after the accident. Now two conditions fail, procedure and cap, and the whole deduction is unlawful as made however clear the fault. Change another: the employer deducts R3 000 but the repair invoice shows R2 200. The deduction exceeds the actual loss and fails on that ground too.

Suppose instead the deduction is R1 500 for a uniform Kagiso was issued on his first day, under a clause in his contract saying the company "may deduct any amounts owing". The checker places this under another debt and asks whether he agreed in writing to this specified debt. A general clause is a weak basis; if there is no written agreement naming the uniform and the amount, the headline is that the deduction is not permitted for want of written consent for a specified debt.

What the calculator does not include

It does not decide fault. Whether the loss occurred in the course of employment and was due to your fault is a question of fact that the fair procedure is supposed to answer. The checker tests the other conditions and reminds you of this one.

It does not evaluate the fairness of the procedure beyond asking whether you were given a chance to show why the deduction should not be made. What a fair procedure requires varies with the amount and the circumstances.

It does not deal with set-off on termination, where an employer withholds a final payment against an alleged debt. That raises the same section 34 questions plus others, and the amounts involved are usually larger.

It does not cover deductions under a collective agreement, which may permit things an individual agreement could not, within the Act's limits.

It does not cover an employer's claim for damages in court. Section 34 governs deductions from remuneration; it does not stop an employer suing you for a loss it cannot lawfully deduct, although in practice that is rare for small amounts.

When to get advice

Start with the payslip. If a deduction appears without a stated purpose, ask in writing what it is for and under which agreement or order it was made. Many deductions evaporate at that stage because there is no answer. If the answer is loss or damage and the conditions were not met, ask in writing for repayment and point to section 34(2). Keep copies of everything.

If the employer refuses, a labour inspector can issue a compliance order at no cost, and if you earn below the earnings threshold a section 73A referral to the CCMA is free. Get advice if the amount is large relative to your pay, if the deduction is being taken from a final payment on termination, if you are being pressed to sign a consent form you do not understand, or if the employer is treating a disputed debt as settled because you did not object immediately. Do not sign a consent form in a meeting without taking it away first; consent given afterwards legitimises a deduction that was unlawful when made.

Frequently asked questions

Can my employer deduct money for a till shortfall or missing stock? Only if the loss was due to your fault, you were given a fair chance to explain, the deduction does not exceed the actual loss, and the total does not exceed one quarter of your remuneration in money, with your written consent. An unexplained shortfall in a till used by several people usually fails the fault requirement.

What is the one-quarter rule? The total deductions from your remuneration for loss or damage may not exceed one quarter of your remuneration in money. On R8 000 a month, that is R2 000. A larger debt must be recovered in instalments within the cap.

I signed a general clause allowing deductions. Does that count? It is a weak basis. Section 34 requires written agreement to a deduction in respect of a debt specified in the agreement. A clause signed before the debt existed, naming no debt and no amount, does not fit that comfortably.

Can my employer deduct an overpayment? Yes, where the overpayment resulted from an error in calculating your remuneration. That is expressly allowed. The deduction must still appear on your payslip with its purpose.

Do I need to consent to PAYE, UIF or a maintenance order? No. Deductions required by law, a collective agreement, a court order or an arbitration award do not need your consent.

Can my employer deduct for a uniform or training? Only with your written agreement to that specified debt, and never by way of forcing you to buy goods from the employer. Training cost recovery clauses are common and are enforceable only to the extent they meet section 34.

What can I do about an unlawful deduction? Ask for repayment in writing, then go to a labour inspector or, if you earn below the earnings threshold, refer a section 73A claim to the CCMA. Both are free.