Deductions from an employee's salary

Feb 10, 2016

What deductions can an employer legally make from an employee’s salary? Deductions from an employees salary

Money can only be taken off an employee’s salary if he agrees to it, or if the employer is legally obliged to do so. This is normally in the form of a collective agreement, a written agreement with the employee, legislation or a court (Section 34 of the Basic Conditions of Employment Act 75 of 1997) (BCEA).

Deductions that an employer may legally make include:

  • Tax from an employee’s salary to pay the South African Revenue Services (SARS);
  • A contribution to the Unemployment Insurance Fund (UIF);
  • Union subscriptions in line with a stop order signed by the employee, which is paid over to the union;
  • Medical aid and retirement fund contributions, if it is in the employer’s employment contract. The employer pays these amounts to the fund;
  • Deductions in terms of a written agreement with the employee to pay back a debt. For example to pay back a study loan;
  • Deductions in terms of a garnishee order; or
  • If the employee was overpaid in error.

Other deductions from an employee’s salary may only be made if the following requirements are met:

  • The employee causes the employer to suffer damage or loss. For example, Peter causes an accident with the company car because of his negligence.
  • The employee agrees in writing that the employer may deduct money for the loss or damage the employer suffer.
  • The employer must specify a certain and exact amount in the written agreement.
  • The loss or damage must happen during the employee’s employment and be due to his fault.
  • The employer must follow a fair procedure (e.g. a hearing) to determine the employee’s guilt and give him a chance to say why the employer should not make the deductions.
  • The total amount the employer deducts may not be more than the amount of the actual loss or damage the employer suffers. The employer may also only deduct a maximum of 25% of the employee’s remuneration at a time.

For example, if employee is dependent on his private car to perform his job, such as sales, and the car has broken down, the employer can assist the employee financially to fix his car, in the form of a loan. However, it is best to get the employee to sign an Acknowledgment of Debt.

Disclaimer: LabourMan exclusively provides services to employers.

The content does not constitute legal advice, are not intended to be a substitute for legal advice and should not be relied upon as such. Kindly contact us on or 021 556 1075 to speak to one of our consultants.


Wallace Albertyn

Wallace Albertyn is a Senior Associate and Legal Advisor at LabourMan Consultants.

Recent LabourTalk Articles

Dismissal of Prolonged Cases by the CCMA

Dismissal of Prolonged Cases by the CCMA

Introduction The case of South African Airways(SOC) Limited (in Business Rescue) and Others v National Union of Metalworkers of South Africa obo Members and Others (JA32/2020)...

Digital Evidence v Artificial Evidence

Digital Evidence v Artificial Evidence

With the proliferation of Artificial Intelligence (AI), it has never been easier to manipulate messages, videos or graphics. Therefore, the integrity of digital evidence in the...

LabourTalk Newsletters

Subscribe and receive labour related information

Follow us



© 2024 ~ All Rights Reserved  |  Privacy Policy