Hello all, I have noticed that our company deducts uniform costs for our employees. It is only mentioned during induction and nowhere in the Offer letter or appointment letter. Is it a deduction passable under the Payment of Wages Act or not? Thanks in advance for any valuable insights.
From India, Bengaluru
From India, Bengaluru
Hi, Yes legally it is not right to deduct. But what is the amount they are planning to deduct ? If it is going to be meager value why can't you move ahead. Basically offer letter will brief about designation /compensation package / period of employment / place of posting only and you can't expect everything to be mentioned in the offer letter.
From India, Madras
922From India, Madras
Read section 6 and 7 of payment of wages act. Deduction for uniform is illegal and the company will be liable to repay it. It does not matter whether it is in the appointment letter or not
From India, Mumbai
From India, Mumbai
Has the company deducted any amount from the salary of employees on account of uniform? This is not allowed and seems quite unlikely.
Some companies show cost of uniform in their CTC at the time of offer but obviously it is not paid as uniform is provided.
Please clarify
From India, Kolkata
Some companies show cost of uniform in their CTC at the time of offer but obviously it is not paid as uniform is provided.
Please clarify
From India, Kolkata
Uniform Deduction and the Payment of Wages Act in India
The Payment of Wages Act, 1936, is a key piece of legislation in India designed to regulate the payment of wages to certain classes of employed persons. It ensures that wages are paid on time and without unauthorized deductions.
Read More : Minimum Wages
Deductions Permissible Under the Payment of Wages Act
Section 7 of the Payment of Wages Act specifies the kinds of deductions that are permissible from the wages of an employee. These deductions include:
Fines
Deductions for absence from duty
Deductions for damage to or loss of goods expressly entrusted to the employed person
Deductions for house-accommodation provided by the employer
Deductions for amenities and services supplied by the employer
Deductions for recovery of advances or loans
Deductions for income tax
Deductions required to be made by law (such as provident fund contributions)
Deductions for payments to cooperative societies
Deductions for payments made to a provident fund
Other deductions with written consent of the employee
Uniform Deduction
Uniform deduction refers to the deduction from an employee’s wages for the cost of uniforms provided by the employer. The permissibility of uniform deduction under the Payment of Wages Act can be evaluated based on the following criteria:
Amenity or Service Supplied by the Employer: If the uniform is considered an amenity or service supplied by the employer, the cost could potentially be deducted from wages under the provision that allows for deductions for amenities and services.
Written Consent: If the employee has given written consent to such a deduction, it may be permissible under the "other deductions with written consent of the employee" provision.
Practical Considerations
Employment Contract: Often, the terms regarding uniform deductions are specified in the employment contract or company policy. It is crucial that the employer clearly communicates these terms to the employee, and the employee consents to them.
Reasonableness: The deduction should be reasonable and not cause the employee undue financial hardship. It should not exceed the limits prescribed by the Act (which stipulates that total deductions should not exceed 50% of the wages in any wage period, or 75% in cases where deductions are for payments to cooperative societies).
Conclusion
Uniform deductions can be permissible under the Payment of Wages Act, 1936, if they fall within the categories of deductions allowed by the Act, particularly as an amenity/service or with the written consent of the employee. However, the exact applicability and permissibility can depend on the specific circumstances, such as the employment agreement and the employer's policies. Employers should ensure compliance with the Act and possibly seek legal counsel to avoid any violations.
From India, Mumbai
The Payment of Wages Act, 1936, is a key piece of legislation in India designed to regulate the payment of wages to certain classes of employed persons. It ensures that wages are paid on time and without unauthorized deductions.
Read More : Minimum Wages
Deductions Permissible Under the Payment of Wages Act
Section 7 of the Payment of Wages Act specifies the kinds of deductions that are permissible from the wages of an employee. These deductions include:
Fines
Deductions for absence from duty
Deductions for damage to or loss of goods expressly entrusted to the employed person
Deductions for house-accommodation provided by the employer
Deductions for amenities and services supplied by the employer
Deductions for recovery of advances or loans
Deductions for income tax
Deductions required to be made by law (such as provident fund contributions)
Deductions for payments to cooperative societies
Deductions for payments made to a provident fund
Other deductions with written consent of the employee
Uniform Deduction
Uniform deduction refers to the deduction from an employee’s wages for the cost of uniforms provided by the employer. The permissibility of uniform deduction under the Payment of Wages Act can be evaluated based on the following criteria:
Amenity or Service Supplied by the Employer: If the uniform is considered an amenity or service supplied by the employer, the cost could potentially be deducted from wages under the provision that allows for deductions for amenities and services.
Written Consent: If the employee has given written consent to such a deduction, it may be permissible under the "other deductions with written consent of the employee" provision.
Practical Considerations
Employment Contract: Often, the terms regarding uniform deductions are specified in the employment contract or company policy. It is crucial that the employer clearly communicates these terms to the employee, and the employee consents to them.
Reasonableness: The deduction should be reasonable and not cause the employee undue financial hardship. It should not exceed the limits prescribed by the Act (which stipulates that total deductions should not exceed 50% of the wages in any wage period, or 75% in cases where deductions are for payments to cooperative societies).
Conclusion
Uniform deductions can be permissible under the Payment of Wages Act, 1936, if they fall within the categories of deductions allowed by the Act, particularly as an amenity/service or with the written consent of the employee. However, the exact applicability and permissibility can depend on the specific circumstances, such as the employment agreement and the employer's policies. Employers should ensure compliance with the Act and possibly seek legal counsel to avoid any violations.
From India, Mumbai
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Uniform deduction policy.doc
PMRPY-DEDUCTION -SOLUTION.xls