Can an employer withhold your wages owed.

[Introducingme]

We had an employee who allegedly stole something from the workplace.
No police action, no investigation. Just made uncomfortable they resigned.
I only receive instructions to pay the payroll from the bank every 4 weeks.
I've been asked not to pay this person any money owed.
They are owed a tax refund and that is all I'm told to pay.
This person is owed holiday pay plus 5 hours for work they attended.

I feel I've been put in a terrible position. Just getting as much info as possible
so I can push back.

It’s an alleged case with no police action so not even a crime investigation number to go against it, I would say the employer doesn’t have a leg to stand on and if the employee goes to court they probably will also try to sue for bullying too, why not whilst they are there for their wages not being paid when it’s rightfully owed.

Your job is to do what your employer asks you.

I hope your not in contact with the ex staff member outside of work

No, only in very specific cases, which do not include what you have outlined.

The ACAS website says:

If your wages are not paid
By law (Employment Rights Act 1996), your employer must pay your wages on your agreed pay day.
If an employer does not pay on time, it can:
affect an employee's financial security and wellbeing
damage the working relationship
lead to legal action

I understand why your company might feel aggrieved but the person would have a right to take action against them (but not you as an individual)

Your employer is wrong BUT its not necessarily your job to make them act correctly.
You can document by email that you are not sure its lawful but if they still tell you to do it them do it

@Iamallowedtodisagreewithyou no I'm not in contact.

This is not your fight, sorry. You can flag that it may not be lawful, but you cannot countermand the instructions.

Thank you for your replies. I have only been in this job for a few months and I'm worried that it will effect me.

Your employer has no right not to pay.

You dont have a legal right to make unauthorised payments from your employers bank account.

Make sure you get your instructions to not process a file (employee payroll) in writing and do the same for the bank transfer.
The person making the change needs to have the authority to stop the payroll process.
So if its a small busness the boss should be involved in stopping it. If its a larger organisation its HR type signoff to stop.

If it were to end up in court so you want to be in a position of having a clear documented process of who said what and when. And that you as an employee followed you employes instruction to a t.

If you have already run his/her full payroll for time and holidays and witholding net amounts your total tax and NI filing may be wrong so would the p45 return if you file it to close him out on the Er number.
And an employee complaining about not getting correct a P45 can trigger a tax inspection

Your employer is wrong. They received the goods/ time from the employee they need to pay up.
As for the suspected theft, that's a different matter, preferably for the police.

However, ensure you have the don't pay request in writing and just do as you are told.

Get all the details in writing from your employer, and do what they tell you to do. Print everything out so if anybody deletes emails, Word documents etc, then you have physical proof that you were acting under their specific instructions. If somebody tells you to do something face to face or over the phone, follow it up with a confirmation email, eg 'as per your request this morning I will be doing x, y, and z".

They can if it is required by law or if the employee's contract allows for it (e.g. deducting for a previous overpayment). I would cover your arse, if I were you, and ensure any instructions you receive are in writing and you politely query them e.g. 'I just want to double-check your instruction to withhold payment of salary owed to x. It's my understanding that the company is required to pay all employees who leave outstanding holiday payments and any salary owed and, if we don't, the company may be liable to some form of legal claim from the employee. How would you like me to proceed?'

I also agree with @theboffinsarecoming - print hard copies of absolutely every instruction you receive and your response. A company I worked with tried to deny they had sent a particular email by getting IT to delete the email from the servers. Luckily (for the employee), the employee had printed a hard copy before the soft copies were deleted.

You are obliged to pay them moneys owed. If they fill in an ET1 to claim, I suggest you pay them before it goes to tribunal and your company end up with a lot of admin and waste court time.

It will be in the public forum as well that the company haven't paid an employer moneys owed - not good.

I have printed out some emails beforehand I finished work today.
Payroll is on Wednesday. So I have time to get more instructions.

If they have an express contractual right to deduct from wages in these circumstances, then provided that clause is exercised reasonably, they can deduct from wages for losses caused by an employee.

If they have sufficient proof that the employee stole the item, and a relevant contractual right, then the law does allow them to deduct from the final salary.

So if the employee admitted to it and the contract allows it for example then the deduction is fine. Otherwise they’d be relying on the investigation… which they didn’t do…!

No the employee is not obliged to pay anybody.

Knowinly moving money without permission is a serious sackable breach of contract.

The employee has no authority to pay out monies from the payroll system.

The OP is an employee not the employer.

I meant the employer

I.meant the employer not you personally, apologies for any confusion. You just have to follow your employer's instructions.

👍

But this is an employee in a new job so that split is very important

I have only been in this job for a few months

This is a great insight into your new employers, who apparently are bullies who will get rid of employees on a whim and then happily withhold pay.

Get absolutely everything in writing and print it all out. If there is any comeback from their actions in withholding this persons pay, your employer will probably happily throw you under the bus if needed.

And start looking for a new job. Unless this is the type of company you want to continue to work for.

@HenDoNot after a sleepless night worrying about it, I'm going to start looking.
As DH has said 'we work to live, not live to work'.

I agree, my mistake

Good luck

Can i suggest you see if they can get you (they pay).some extra training so you can upskill the legal bits of payroll

https://www.gov.uk/guidance/free-courses-for-jobs

Good grief.
However this is easily fixable as long as the employer (usually HR) writes a letter / email to employee advising them. Most companies do this, ie because you haven't returned laptop / uniform etc a deduction of £xxx will be made from your final salary. There is still plenty of time for this to be done pre payroll on Wednesday. Then the hours owed, outstanding holiday etc are processed. Less the deduction. Net pay paid. P45 issued. Easy.

Re the deduction, in eg sage payroll, once you've put in the hours worked, holiday owed, and it calculates the tax refund. Then you have the net pay. You can then only out through a deduction for that amount, because sage payroll you can't have a negative net pay.

Agreed. It would be better to run payroll with correct final hours and holiday pay. Issue p45. Then do the deduction. So at least there is a payslips documenting what happened for them to take to a tribunal etc.

And yes get it in writing what you are being required to do.