Disputes about deductions

Section 34 of the Basic Conditions of Employment Act (BCEA) outlines the prerequisites that must be satisfied before any deductions can be made from an employee’s remuneration.

What are the consequences of deducting money from the employee’s remuneration without his/her consent?

The employee has the right to raise a dispute internally regarding the alleged unlawful deduction. If such a dispute is raised internally, it must be dealt with, and feedback must be provided to the employee. If the dispute is not resolved, the employee has the right to refer the dispute to an external dispute resolution.

Which external dispute resolution has the right to deal with a dispute regarding alleged unlawful deductions?

Section 77 of the BCEA provides that the Labour Court has exclusive jurisdiction over all disputes arising from the Act.  Therefore, in terms of Section 77, the Labour Court has jurisdiction to deal with disputes relating to unlawful deductions.

This principle was confirmed in the matter of O’Reilly v CCMA and Others JR 2395 19, where the Court held that “there is no provision in the BCEA that says that the CCMA has jurisdiction to determine a claim regarding an alleged breach of Section 34(1) of the BCEA”.

Does the CCMA have jurisdiction?

No, the Commission for Conciliation, Mediation and Arbitration (CCMA) does not have jurisdiction to adjudicate a dispute for unlawful deductions.  If a matter is referred to the CCMA where the employee is disputing the deductions made, a point in limine can be raised in which arguments are to be lead that the CCMA lacks jurisdiction and that the matter can only be entertained by the Labour Court.

The CCMA will only have jurisdiction to adjudicate matters that relates to monies owed to an Applicant in terms of Section 73A, which includes salaries, bonuses, amounts due in terms of the National Minimum Wage Act (NMWA), and any amounts that the employer is obligated to pay in terms of the BCEA, but excludes deduction disputes.

Tips to keep in mind:

• Employers may lawfully deduct specific amounts from an employee’s salary with their written consent and if required or permitted in terms of a law, collective agreement, court order or arbitration award.
• The amount deducted from an employee’s salary may not exceed one-quarter of the employee’s remuneration in money (per payment).
• The CCMA lacks jurisdiction to adjudicate disputes regarding Section 34 of the BCEA relating to deductions made, and the dispute should be referred to the Labour Court instead.

Labour legislation strictly regulates any deductions made from an employee’s remuneration, and employers must guard against deducting any money without following the correct procedure. 

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