Labour & Employment Law Blog

Your Pay and How to Protect It: Deductions and Withholding Wages

Picture of Zeilikman Law

Zeilikman Law

Your Pay and How to Protect It: Deductions and Withholding Wages

Payday is a day we all look forward to.  But, what do you do if you look at your paycheque to find missing wages or unexpected deductions?

As an employee, it’s important to know when your employer can and cannot deduct money from your pay.  Section 13 of the ESA (Employment Standards Act) outlines what deductions are allowed, and which are not.

Employers can make any statutory deductions to wages required (i.e., income tax, Canadian Pension Plan, Employment Insurance, etc.).  An employer can also garnish an employee’s wages when imposed by a valid court order.  Any other deductions can only be made when an employee has given written consent.  Moreover, such a written consent will only be valid if there is a certain amount stipulated or if there is a proper formula set in place.

Thus, employers generally have no legal right to withhold or deduct any money from a worker’s pay.  Employers cannot make deductions for faulty work, damaged property, or any missing or stolen cash, for which the employee was not responsible.

If your employer is withholding your pay or making undue deductions, you may have the option of claiming constructive dismissal (considered a termination of employment), for which you may be due termination and severance pay.  If you don’t wish to go that route, you may make a complaint to the Ministry of Labour.  It’s important to note that any reprisal made by your employer in response to a complaint is prohibited by the ESA.  If your employer punishes you in response to your complaint, they may be liable for significant damages.

Each situation is highly case-specific and it is best to seek legal advice prior to taking any steps. The route you choose to take may have serious consequences on the type of remedy you’re ultimately going to get.

The above article is for general information purposes only, does not constitute legal advice or create a solicitor-client relationship. Because each case is unique and factually driven, if you have concerns with regard to the foregoing issues, please make an appointment with one of our lawyers or a qualified legal practitioner elsewhere. We represent clients in the Greater Toronto Area including Toronto, North York, Markham, Vaughan, Thornhill, Newmarket, Aurora, Brampton, Mississauga, Barrie, Ajax, Whitby, Pickering and Oshawa.