Salary Advance Deductions: Is It Legal to Deduct Full Net Pay Over Two Months?

Hello Team, Can we deduct an employee's salary advance at once from his/her net pay? For example, let's say an individual, Person X, receives a net pay of 80K per month and has taken a salary advance of 1.60 Lakh. Can the employer deduct 80K in two installments to recover the full salary advance? If this approach is taken, Person X will receive "0" net pay for two months. Is this permissible in legal terms, or is there a provision stating that the employer cannot deduct the entire net pay amount?

I would appreciate your assistance in providing comprehensive information regarding the above query.

Thank you!

Regards, Satya

Hi, then what will the employee do for survival? There are provisions for salary deductions in the Act. The total amount of deductions cannot exceed 75 percent of the wages.

Salary Deduction Limits Under the Payment of Wages Act

Salary deduction has a limit under the Payment of Wages Act. In normal conditions, it may be possible to deduct up to 50%, but with cooperative deduction, it may go up to 75%.

S K Bandyopadhyay (WB, Howrah)
CEO-USD HR Solutions
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