Employee No-Show for a Week: Can We Legally Deduct Their Salary?

If an employee has not come to work for 7 days without intimation, can we deduct the salary as per labor law?

Punctuality and regularity in attendance and performance of the assigned work are obligations imposed on the employee under the contract of employment. When an employee fails in these obligations abruptly, they automatically lose their right to full wages. Therefore, the employer is legally empowered to initiate disciplinary action against the employee on the charge of unauthorized absence, apart from deducting wages for the period of absence.

As an employer, you have every right to deduct salary. I'm not sure if you have tried to contact the employee to find out the reason behind the absence. There is a possibility that the employee may have valid reasons for not reporting, such as health issues, COVID lockdown, etc. Another possibility could be that the employee has joined another company. Why don't you try reaching out to them first to inquire?

Thank you.

Handling Employee Absence Without Intimation

If an employee remains absent without intimation, what is an employer supposed to do?

1. Please communicate with the employee to find out the reason behind the absence.

2. Should you issue a formal show cause notice to the employee?

3. Initiate an inquiry?

4. Allow the employee to be heard regarding their absence?

5. Conclude with a suitable punishment/penalty, which may or may not include a deduction of wages depending on the gravity of the fault.

Before treating a 7-day absence as unauthorized and considering wage deductions, please ensure that comprehensive leave rules are in place and have been communicated to all employees. If an employee, despite being aware of the leave rules, chooses to be absent from duty without permission or notice, it may result in disciplinary action as well as non-payment of wages under the principle of 'No work, no pay.'

Regards, Vinayak Nagarkar
HR and Employee Relations Consultant

Understanding Employee Wages and Attendance

Wages or salary is the remuneration for work performed. No employee is entitled to wages as a matter of right just because of their appointment. To my knowledge, there is no such law or principle of law or equity. On the contrary, the onus rests with the employee to either attend to duty or, if absent, to apply for leave as eligible.

All the above responses are correct; however, I would like to add the following:

No Work, No Pay Principle

"No work, No Pay" is a universal law, and our labor laws also recognize this principle. There is a prohibition on undue deductions in terms of the head of deduction and proportion of deduction under the Payment of Wages Act.

Company Leave Rules and Policy

In your case, after deciding to deduct for absenteeism, the company's leave rules/policy come into play.

- What is the time period to apply for leave in cases of absenteeism?
- Is there a laid-down rule to inform employees to apply for leave before a salary deduction?

Regards, Shailesh Parikh [Phone Number Removed For Privacy-Reasons] Vadodara