Can an employer make deductions from wages without your consent?
The Employment Rights Act 1996 protects you from unlawful deductions from wages.
Your employer must have written consent to make deductions from your wages unless it is a lawful deduction as follows:
- Your employment contract allows the deduction.
- You have been overpaid by mistake.
- You have taken part in a strike or industrial action.
- It is a legal requirement. For example, income tax, National Insurance, student loan repayment or a court order.
Your employer should inform you if they are going to make a deduction from your pay that you may not expect.
Can your employer withhold pay?
An employer can only withhold pay if it is classed as a ‘lawful deduction’ as listed above.
What are your rights if you are underpaid?
If you have been underpaid due to an unlawful deduction from your wages, then you are protected under the Employment Rights Act 1996.
Underpayment of wages is classed as an ‘unlawful deduction’.
What can you do about unlawful deductions from wages?
The first step is to bring the deduction to your employer’s attention and to try to resolve the matter with them informally. If that does not work, raise the issue formally, in writing, through your employer’s grievance procedure.
If you do not achieve a satisfactory outcome, register your claim for unlawful deduction of wages with ACAS (Advisory, Conciliation and Arbitration Service). It is important to act as quickly as possible because you have just six months less one day of the unlawful deduction to register with ACAS.
Where there has been a series of underpayments, the time limit begins from the date the last deduction was made.
When ACAS cannot settle your claim with your employer, your case can be referred to an employment tribunal where an employment judge will decide the outcome.