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Deduction from salary agreement

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If you need to make a regular deduction from the salary of an employee, issue this model agreement to obtain their consent.

Reading time
How long to understand and implement this template?
5 mins
Word count
How many words in this template?
198
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What is a Deduction from salary agreement?

A Deduction from Salary Agreement is a written agreement between an employer and employee that specifies the types of deductions that may be taken from an employee's salary. Deductions may be made for various reasons, such as taxes, insurance premiums, retirement contributions, or other benefits provided by the employer.

The agreement typically outlines the terms and conditions of the deductions, including the amount to be deducted, the frequency of deductions, and the duration of the agreement. It may also specify the circumstances under which deductions may be increased or decreased, and the process for disputing or challenging any deductions made.

It is important to note that deductions from salary must comply with local labor laws and regulations, and the agreement must be signed by both the employer and employee before any deductions are made.

Section 13 of the Employment Rights Act 1996 makes it unlawful for an employer to make deductions from an employee's wages unless the employee has given prior written consent, or a relevant provision exists to this effect in the employment contract.

Issued by who, to whom
Who should issue this template, and to whom?
The Employer (you) to the Employee
Applicable legal jurisdictions
In which jurisdictions can this template be used?
Great Britain & NI (United Kingdom), Worldwide

Deduction from salary agreement

Name:  
Department:  
Item:  
Cost:  

I, [name], herby authorise the deduction of £[amount] from my salary each [week|month] in respect of [reason for deduction, e.g. sports and social club subscription, BUPA membership, etc.].

This letter does not authorise any other deduction(s) than that stated above, nor do I agree to any variation upward of the amount stated without my further written approval.

I understand that this is a relevant provision of my contract and that if insufficient remuneration is due to me from my employer, further action may be taken to recover any outstanding debt.

If you are in agreement with the above terms and conditions please sign both copies of this statement, retain one and return the other to HR Services.

Signed (employee):  
Date:  

HR SERVICES / PAYROLL USE ONLY

Details recorded?:  
By (name):  
Date:  

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Pay or salary payment arrangements policy

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Deduction from salary agreement template
deduction from salary agreement