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CS Professional · Labour Laws and Practice · Law of Wages

Sunita earns Rs 30,000 for a wage period. Authorised deductions due total Rs 21,000 (loan recovery, tax and provident fund). How does the Code treat the amount above the 50% ceiling?

Only Rs 15,000, being fifty per cent of wages, can be deducted in that wage period. The excess Rs 6,000 is not wiped out; it may be recovered in the manner prescribed under the Code.

  1. AThe employer may deduct the full Rs 21,000 since all items are authorised
  2. BOnly Rs 15,000 may be deducted in the wage period, and the excess Rs 6,000 may be recovered in such manner as may be prescribedCorrect
  3. COnly Rs 15,000 may be deducted and the excess is automatically extinguished
  4. DThe employer may deduct Rs 21,000 if Sunita consents orally

Explanation

Fifty per cent of Rs 30,000 is Rs 15,000. Excess of Rs 6,000 over the cap may be recovered in the prescribed manner, not extinguished and not deducted at once. Oral consent does not override the cap.

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