Commonwealth Consolidated Acts

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Permitted deductions

  (1)   An employer may deduct an amount from an amount payable to an employee in accordance with subsection   323(1) if:

  (a)   the deduction is authorised in writing by the employee and is principally for the employee's benefit; or

  (b)   the deduction is authorised by the employee in accordance with an enterprise agreement; or

  (c)   the deduction is authorised by or under a modern award or an FWC order; or

  (d)   the deduction is authorised by or under a law of the Commonwealth, a State or a Territory, or an order of a court.

Note 1:   A deduction in accordance with a salary sacrifice or other arrangement, under which an employee chooses to:

(a)   forgo an amount payable to the employee in relation to the performance of work; but

(b)   receive some other form of benefit or remuneration;

  will be permitted if it is made in accordance with this section and the other provisions of this Division.

Note 2:   Certain terms of modern awards, enterprise agreements and contracts of employment relating to deductions have no effect (see section   326). A deduction made in accordance with such a term will not be authorised for the purposes of this section.

  (1A)   However, an employer must not deduct an amount under paragraph   (1)(a) if the deduction is:

  (a)   directly or indirectly for the benefit of the employer or a party related to the employer; and

  (b)   for an amount that may be varied from time to time;

unless the deduction, if it were a deduction referred to in subsection   326(1), would be a deduction made in circumstances prescribed under subsection   326(2) to be reasonable.

  (2)   An authorisation for the purposes of paragraph   (1)(a):

  (a)   must specify:

  (i)   for a single deduction--the amount of the deduction; or

  (ii)   for multiple or ongoing deductions--whether the deductions are for a specified amount or amounts, or for amounts as varied from time to time; and

  (aa)   must include any information prescribed by the regulations; and

  (b)   may be withdrawn in writing by the employee at any time.

  (3)   Any variation in a specified amount of a deduction must be authorised in writing by the employee.

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