Dear Punnya Sumith,
In the case of under-performance or non-performance of an employee, the employer needs to conduct a domestic enquiry. You need to establish clearly the causes of under-performance or non-performance. After enquiry, you may award suitable punishment to an employee which could be even termination of his/her services.
If you terminate the services of an employee, it would be the punishment of the highest kind. Therefore, you cannot forfeit the wages of an employee. You cannot award double punishment for single misconduct. It would be against principles of natural justice.
Thanks,
Dinesh Divekar
+91-9900155394