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Which wage deductions are allowed under employment law

Employees in British Columbia may be unsure about their rights when it comes to deductions from their salary or wage payments. The BC Employment Standards Act, RSBC 1996, c 113, authorizes some deductions and takes action against employers who make unauthorized deductions.

Employers must deduct from employees' wages income tax, contributions for the Canada Pension Plan, premiums for Employment Insurance, amounts pursuant to lawful garnishment orders and other amounts such as union dues that are collectively agreed upon.

The employer may not make unauthorized wage deductions such as amounts withheld to pay for business costs such as breakage, damage, theft or work of an inferior quality. Even if an employee agrees to such a deduction, it will not be enforceable. By law, these clawbacks will be seen as unpaid wages that will be recoverable by the Employment Standards Branch.

Deductions that might be permitted include direct payments to third parties as requested by an employee. This could include medical premiums, tax-deductible pension plan contributions, extended dental and health coverage, and payments ordered by the Family Maintenance Enforcement Act. However, written permission by the worker will be required, and written notice from the employee to the third-party recipient and the employer can end such an agreement. 

Employees in British Columbia who believe their employers have made unlawful wage deductions may find comfort in learning that resources are available to provide legal guidance. An experienced employment law lawyer can assess the circumstances and launch an independent investigation if necessary. The lawyer can then explain the client's options and proceed with the steps needed to reach the best possible outcome which might include recovery of lost wages. 

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