How much salary can be deducted under violation of company policy?

Hello everyone,
i work as an HR manager in a factory setup. two of the floor employees were caught wearing earphones while working hours, which is strictly prohibited and a safety hazard as they work with sharp and heavy machinery. I've received orders from above to deduct 10% of their salary for the month of July. My doubt is, is the Company allowed to deduct such a high percentage as fine when actually there was no loss to the Company by their action?
Looking forward to gain some knowledge on this issue....

hlww
If they break the law of the company, then it comes under the Misconduct.
So first you have to give the warning letter to the employees, which should be talked about that if you make this mistake again in the future, then they will be taken particular amount from their salary. And This Should Be Accept By Employee via mail or physical letter
Thanks
Khirod Kumar
Hr Executive (Production)

Before enforcing any deduction from wages, do you have any approved list acts and omissions for which wage cut could be imposed, form the appointed authority?
Under The Payment of Wages Act, 1936
Section 8. Fines.- (1) No fine shall be imposed on any employed person save in respect of such acts and omissions on his part as the employer with the previous approval of 1[the appropriate Government] or of the prescribed authority, may have specified by notice under sub-section (2). (2) A notice specifying such acts and omissions shall be exhibited in the prescribed manner on the premises in which the employment is carried on or in the case of persons employed upon a railway (otherwise than in a factory), at the prescribed place or places.

Gear Kur_Daily,
I think that your establishment as well as the two employees would be coming under the purview of the Payment of Wages Act,1936(even the proposed Labor Code,2019 seems to have removed the salary ceiling for applicability). Section 8 of the PW Act,1936 imposes certain restrictions on imposition of fines on employees including prior approval from the Authority under the Act, giving of reasonable opportunity to the employee, the maximum quantum of the fine amount as a fixed percentage to the earnings in the wage period and the like. Viewed from this angle, the implementation of the orders from above would be certainly arbitrary. Therefore, I would suggest to you to bring this legal position politely to your top brass and act cautiously in the matter.

As they earlier said, Written warning letter to be issued. After issue of warning letter the same issue continued them you may go for further legal actions.
Regards,
Anil Kumar KT