Can My Employer Take Money From My Wages?

Your employer can take money from your wages only in three situations: the law requires or allows it, a written term of your contract allows it, or you agreed in writing before the deduction was made. Any other deduction is unlawful under section 13 of the Employment Rights Act 1996. You can recover it through an Employment Tribunal.

The three lawful grounds

Section 13 of the Employment Rights Act 1996 allows a deduction only where one of these applies.

1. A statutory provision requires or allows it. Income tax, National Insurance and student loan repayments are examples.
2. A relevant provision of your contract allows it. The term must be in a written contract you were given before the deduction, or your employer must have told you about the term in writing before the deduction.
3. You signified your agreement or consent in writing before the deduction was made.

A contract term or a consent signed after the event does not cover it. Section 13 states that a later variation or consent does not authorise a deduction for conduct or any other event that happened before it took effect. An employer who asks you to sign a consent form after a till shortage cannot rely on that form to take money for the shortage already found.

Deductions the law excludes

Section 14 of the Employment Rights Act 1996 removes some deductions from these rules. The most common is the recovery of an earlier overpayment of wages or expenses. Others include deductions because you took part in a strike and payments your employer must make to a public authority under a statutory requirement.

Your employer must still show that an overpayment occurred. If you dispute the amount, ask for the calculation in writing. GOV.UK states that if you leave your job, your employer can take the full amount owed from your final pay where a deduction is lawful.

Retail workers and the 10% limit

Sections 17 to 22 of the Employment Rights Act 1996 give extra rules to workers in retail employment, such as shop staff and cashiers. Under section 18, deductions for cash shortages or stock deficiencies must not exceed one tenth of your gross wages on any pay day. This applies even where your contract allows the deduction.

The first deduction for a shortage must be made within twelve months of the date your employer found it, or ought reasonably to have found it. Section 22 of the Employment Rights Act 1996 lifts the 10% limit for your final pay when you leave, so a lawful balance can be taken then.

An example

A supermarket cashier with eight months' service earns £1,600 gross a month. Her till is found to be £450 short at the end of a shift. Her contract allows deductions for till shortages, and she was given it in writing when she started. Her employer takes the full £450 from one month's pay. Section 18 of the Employment Rights Act 1996 limits the deduction on that pay day to £160. The excess is an unlawful deduction she can claim back.

Time limits for a claim

Section 23 of the Employment Rights Act 1996 sets the time limit for a claim for unlawful deductions. Acas states that time limits for employment tribunal claims increased from 3 months to 6 months on 1 October 2026. The 3 month limit may still apply to problems that started before 1 October 2026. Check your deadline early and seek advice.

Where there is a series of deductions, time runs from the last one in the series. The tribunal cannot award arrears for deductions made more than two years before you lodged your claim. No qualifying service is needed for this claim.

What to do next

1. Compare every payslip with your contract and identify each deduction.
2. Ask your employer in writing which law, contract term or written consent it relies on for each deduction.
3. Request a copy of your written contract and any consent form you signed.
4. Raise a written grievance if the money is not repaid.
5. Note the date of each deduction and work out your deadline from the most recent one.
6. Start ACAS Early Conciliation well before that deadline.

Keep every payslip in date order, mark each deduction you dispute and keep a copy of your contract with them.

Frances N.U