In terms of the Basic Conditions of Employment Act 75 of 1997(as amended)(“BCEA”) there are two forms of deductions that can be made from an employee’s remuneration, each one having its own set of requirements.

Section 34 of the BCEA

Section 34(1) of the BCEA differentiates between 2 forms of deductions that can be made: 

• Deductions with the consent of the employee; and 
• Deductions for which the consent of the employee is not required.

Section 34(1) of the BCEA reads as follows:

An employer may not deduct 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.

The BCEA therefore generally prohibits any deduction from an employee’s salary without prior consent, unless such deduction is permitted by law, collective bargaining agreement, court order or arbitration award. For example; Unemployment Insurance Fund (UIF) deductions are compulsory and therefore the consent of the employee is required. Furthermore, an employment contract signed where the deductions of medical aid premiums are compulsory; such deduction will be without the consent of the employee as same was agreed to once the employee signed the employment contract.

Bargaining councils

Where a bargaining council has jurisdiction and a collective agreement regulates the employment relationship, certain deductions will by virtue thereof become compulsory, and the employer may deduct without consent. For example; certain collective agreements and where it is binding in terms of an agency shop agreement, deductions such as sick pay fund may be compulsory, and the employer may deduct without consent.

Erroneous payments made by employer

Section 34(5) of the BCEA deals with the collection of any overpayment made erroneously to an employee by the employer, resulting from an error in calculation. This section allows the employer to require the employee to repay remuneration overpaid due to a calculating error.

Section 34(5) of the BCEA reads as follows:

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
• acknowledge receipt of an amount greater than the remuneration actually received.

In Sibeko v CCMA (2001), the court found that the employer can deduct such payments unilaterally, and in Jonker v Wireless Payment Systems CC (2010), the court found that:

“Where an employee was however overpaid in error, the employer is entitled to adjust the income so as to reflect what was agreed upon between the parties in the contract of employment, without the employee’s consent”.

Therefore any deduction from the employee’s remuneration in terms of Sections 34(1)(b) or 34(5) of the BCEA may be done unilaterally without any consent, and shall not be limited in any way, as in the case of a deduction for damages in terms of Section 34(1)(a) (limited to the amount agreed upon) or Section 34(2) (limited to a maximum of 25% of the employee’s remuneration).

Duty of the Employer

Transparency is of paramount and the employee must be informed by the employer when an error in payment has occurred and how such error will be rectified. An agreement must be reached, and the deductions must take place in accordance thereof.

Written by Hamlet Heneke, Professional Assistant, Attorney, Schoeman Law

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