Private sector employers and employees
Telephone: 1300 655 266
Locked Bag 100
East Perth WA 6892
This information is only relevant to employers and employees in the WA state industrial relations system.
An employer may only make a deduction from an employee’s pay if:
It is unlawful to deduct money from an employee's pay if the deduction is not authorised.
A term of a WA award, registered agreement or employment contract providing for a deduction from an employee’s pay will be of no effect if it is for the benefit of the employer or a party related to the employer and is unreasonable in the circumstances. For example, a provision in an employment contract that enables an employer to deduct a grossly inflated amount of rent (beyond market value) from an employee’s pay for employer-provided accommodation could constitute an unreasonable deduction.
Deductions or requirements to pay an amount of money to the employer or another person in relation to an employee under the age of 18 are not permitted unless the deduction or payment is agreed to in writing by the employee’s parent or guardian.
Deductions from an employee’s pay can be made if an employee gives written authority for such deductions to be made and monies paid to another party on their behalf. Some common examples include social or sports club membership, private health fund premiums, and voluntary employee superannuation contributions. An employee can withdraw their authorisation at any time by giving written notice. An employer is not obliged to make deductions requested by an employee.
An employer cannot directly or indirectly compel an employee to accept goods, accommodation or other services of any kind instead of money as any part of the employee’s pay. Visit the Prohibition on accepting goods, accommodation or services as payment page for more information.
It is also prohibited for employers to unreasonable require employees to spend their money in a particular way, or pay back their wages to the employer or another person (sometimes known as ‘cash backs’).
Visit the Prohibition on cash back arrangements page for more information.