Under contract law and the Employment Rights Act 1996 (“ERA 1996”) the worker and the employer are afforded particular rights and responsibilities regarding pay and the protection of the employee’s wages. The employer is under a statutory duty to give employees (not workers, there’s a difference) a written statement including scale or method of calculating wages and the intervals at which wages will be paid, and itemised pay statements (also known as payslips) which must set out the gross wages of the employee and any deductions made by the employer.
In most employment relationships, there is both an express and implied duty for the employer to pay their workers wages (unless the worker is in repudiatory breach of contract or has agreed to waive their contractual right to be paid for whatever reason). If the employer fails to pay a worker the full amount that they are owed under the contract then the employer has breached the terms of the contract. If this failure to pay wages is deliberate then this is a fundamental breach of contract and the worker can choose to terminate the contract of employment (and claim constructive unfair dismissal, if they are an employee and wish to do so). Alternatively, the worker can choose to waive the employer’s breach. If the failure to pay is a mistake on the employer’s part then there is probably not a fundamental breach of contract unless the employer’s conduct is repeated or unexplained. The obligation for the employer to pay the employee persists even if the employee is refused permission to come to work (i.e. for medical reasons, because of disciplinary suspension or if there is a work shortage).
If the employer fails to pay the whole amount of wages owed then the worker may be able to pursue the employer for this. Under the ERA 1996 an employer can make deductions from the wages of the worker but it is unlawful for the employer to make deductions from the wages of the worker unless such a deduction is required or authorised by statute or provision in the contract, or the worker has given prior written consent to the deduction. It is also unlawful for the employer to receive payment from one of its workers unless the deduction is required or authorised by statute or a provision in the contract of employment, or the worker has given prior written notice of the deduction.
In future posts we will take a look at the law relating to the deduction of wages and attempt to define particular terms within the ERA 1996 such as what “wages” are, when wages are “properly payable”, whom is defined as a “worker”, what a “deduction” is, and when the worker is and is not protected under the ERA 1996.