Is an Enterprise Allowed to Deduct an Employee's Salary?

Is the enterprise allowed to deduct employees' salary? (Illustrative photo)

Regarding this issue, the editorial board of THU KY LUAT would like to offer the following explanation:

Is the enterprise allowed to deduct employees' salary?

According to Clause 2, Article 128 of the Labor Code 2012, it is prohibited to discipline employees by fining them or cutting their wages.

Furthermore, Article 101 of the Labor Code 2012 stipulates the deductions from employees' wages as follows:

- Employers are only allowed to deduct employees' wages to compensate for damage caused by the employee to tools, equipment, or other damages to the employer's property. If the employee causes non-serious damage due to negligence with a value not exceeding 10 months of the regional minimum wage, the maximum compensation is 3 months' salary, and it will be deducted monthly from their wages;- Employees have the right to be informed of the reasons for wage deductions;- Monthly wage deductions must not exceed 30% of the employee's monthly wages after mandatory social insurance, health insurance, unemployment insurance, and income tax deductions.

Thus, according to the above regulation, enterprises are not allowed to fine or deduct employees' wages as a form of disciplinary action in case of violation of labor rules or working regulations. There is only one scenario in which an enterprise is permitted to deduct an employee's wages, which is when the employee causes damage to tools, equipment, or other assets of the enterprise.

This regulation aims to protect the lawful rights and interests of employees and prevent enterprises from abusing monetary fines or wage deductions as disciplinary measures. Consequently, if an enterprise violates this regulation, it will be considered a legal violation and subject to administrative penalties.

Unilateral wage deduction, enterprises may be fined up to 15 million

According to Clause 3, Article 18 of Decree 28/2020/ND-CP, a fine of 10,000,000 VND to 15,000,000 VND will be imposed on employers for any of the following violations of labor discipline:

- Violating the body or dignity of the employee during the disciplinary process, where criminal charges are not applicable;- Using monetary fines or wage cuts in lieu of disciplinary measures;- Disciplining employees for actions not stipulated in the labor rules;- Applying multiple disciplinary measures for a single violation of labor discipline.

Therefore, according to the above regulations, if an enterprise unilaterally deducts an employee's wages instead of applying disciplinary measures, it will be subject to administrative penalties ranging from 10 to 15 million VND. Therefore, cases such as fining or deducting an employee's wages for late arrivals, early departures, failure to meet work efficiency, unauthorized leave without the employer's consent, etc., are all considered violations according to legal regulations.

Ty Na

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