Unless the law allows it, an employer may not, directly or indirectly, withhold, deduct, or require payment of all or part of an employee’s wages for any purpose.
- employee contributions to pension plans or registered retirement savings plans;
- employee contributions to other benefit plans;
- charitable donations voluntarily made by the employee;
- voluntary contributions by the employee to savings plans or the purchase of bonds;
- initiation fees, dues and assessments to a union that is the bargaining agent for the employee;
- court-ordered maintenance payments;
- voluntary employee purchases from the employer of any goods, services or merchandise; and
- deductions required by the government, such as Canada Pension Plan (CPP), Employment Insurance (EI) premiums and income tax.
Employers can also recover wage overpayments from an employee’s wage if:
If significant overpayments occur, the employer must either negotiate a repayment schedule acceptable to the employee; or in the case of disagreement, consider recovery through the courts.
- The overpayment was the result of an honest mistake, such as a clerical error.
- The mistake is caught in a timely manner.
- The error is dealt with quickly, with deductions occurring in the following pay period.
Some examples of this include:
- A clerical error results in an employee being overpaid for 18 months. The error is discovered when the employee gives his or her notice of resignation. The employer cannot take the accumulated error amount from the employee’s final pay cheque. Instead, the employer must discuss repayment with the employee. If the employee is unable or unwilling to consider repayment, the employer’s next step would be to sue the employee.
- A time card error results in an employee being overpaid for a few hours of overtime that weren’t worked. The employer may deduct the overpayment from the employee’s next cheque, and note the deduction on the employee’s pay stub.
Wage deductions that are NOT allowed
- poor quality work;
- damage to employer's property including accidents involving employer vehicles or equipment; or
- failure to collect payment by a customer, including "dine-and-dashes" and shoplifting.
An employee is working alone at night in a gas bar. A customer arrives, fills their tank with gasoline, and leaves without paying. The employer is not allowed to deduct the unpaid gasoline cost from the employee's wages.
An employer who requires an employee to wear special clothing that identifies the employer's business must provide it at no cost to the employee. If an employer requests the staff wear certain clothing such as black pants or a skirt and a white shirt or blouse, this is not considered a uniform.
In addition, employers in restaurants, hotels, nursing homes, hospitals, or educational institutions who require their employees to wear a uniform must provide, launder and repair the uniform at no cost to the employee. Registered nurses are exempt from this provision.
An employer also cannot require job seekers to pay for employee recruiting costs. Employee recruitment is considered a business cost. If a person pays an employer for a job, either up-front as a fee or later on through a wage deduction, the Employment Standards Division can recover that money from the employer as unpaid wages and return that money to the employee.