In what circumstances can an employer deduct the salary of an employee?
Labour DepartmentIn accordance with the Employment Ordinance, an employer is only allowed to deduct wages from his/her employee under the following circumstances:
| Circumstance | Remarks |
|---|---|
| 1. Deductions for absence from work | The sum to be deducted should be proportionate to the period of time the employee is absent from work. |
| 2. Deductions for damage to or loss of the employer's goods, equipment, or property by the employee's neglect or default | In any one case, the sum to be deducted shall be equivalent to the value of the damage or loss but not exceeding $300. The total of such deductions shall not exceed one quarter of the wages payable to the employee in that wage period. |
| 3. Deductions for the recovery of any advanced or over-paid wages to the employee | The total sum to be deducted shall not exceed one quarter of the wages payable to the employee in that wage period. |
| 4. Deductions of the value of food and accommodation the employer supplies to the employee | - |
| 5. Deductions in respect of contributions to be paid by the employee through the employer for any medical scheme, superannuation scheme, retirement scheme or thrift scheme | Only at the written request of the employee. |
| 6. Deductions for the recovery of any loan made by the employer to the employee | Only with the employee's written consent. |
| 7. Deductions which are required or authorized under any enactment to be made from the wages of the employee | - |
| 8. Deduction of statutory paternity leave pay that has been paid to the employee | If the employer has paid the employee statutory paternity leave pay before the required document is provided but the employee fails to provide the required document within 3 months after the first day of paternity leave, or where the employee has ceased to be employed, fails to provide the required document before the cessation, the employer may deduct from the employee’s wages an amount equivalent to the paternity leave pay. |
| 9. Deductions for outstanding maintenance payment owed by the employee pursuant to the Attachment of Income Order issued by the court | - |
Deductions under items (1) to (8) shall have priority over item (9).
Unless with the approval in writing of the Commissioner for Labour, the total of all deductions, except those for absence from work and outstanding maintenance payment, made in any one wage period shall not exceed one half of the wages payable in that period.
An employer who makes illegal deduction from wages of an employee is liable to prosecution and, upon conviction, to a fine of $100,000 and to imprisonment for one year.
This is not a legal document. The Ordinance remains the sole authority for the provisions of the law explained.
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