Why no one can deduct Shs10,000 from your salary for Covid-19 fight

Tuesday May 19 2020

Thomas Ddumba

Thomas Ddumba 

By Thomas Ddumba

In a letter to employers, the Chairman of the National Response to Covid-19 Fund, through the Office of the Prime Minister, appealed for Shs10,000 to be deducted from all employed workers’ wages as a contribution to the fight against the deadly virus.

Sections 44 to 46 of the Employment Act 2006 ( EA 2006) set out the provisions that protect workers from unauthorised wage deductions (unlawful deductions).

It is unlawful for an employer to make a deduction from a worker’s wages unless: deduction is required or authorised by law or a provision in the worker’s contract; or the employee has given their prior written consent to the deduction.

The law on unlawful deductions is important as it is through it that employees can use to claim unpaid (or underpaid) wages in the employment tribunal while the employment relationship subsists.

The law applies to any person who has entered into a contract of service or an apprenticeship contract, including those employed by or for the government, a local authority or a parastatal organisation but excludes a member of the UPDF.

Where the total wages paid by an employer to a worker is less than the net amount of the wages “properly payable,” the deficit counts as a deduction. In this case, without prior written consent from an employee, deducting Shs10,000 from wages is unlawful.


Imagine a scenario where an employer gives a pay raise but then stops paying overtime to which a contract exists. Such is an unlawful deduction from wages even if the raise offsets the shortfall in overtime pay. Of course, unless the employer accepts the quid pro quo arrangement.

But then here we are, presented with a situation where many workers are going with half pay, forced unpaid leave and pay cuts, but the government still wants to deduct Shs10,000 from them.

The letter to employers was written on May 12 and many employees will have to wait at the end of the month to find out if Shs10,000 is actually deducted by their employers as only an actual deduction can be the subject of a complaint.

Moreover, if an employer, without contractual authority or individual, reduces an employee’s wages, this will normally amount to a deduction for the purposes of the unlawful deductions regime.

However, Section 46 of the EA 2006 deals with permitted deductions and is further qualified with a clause that stipulates that a deduction will not be unlawful if the employer has prior written consent from the employee.

Prior written consent could be given via a written contract which has been given to the employee before the deduction was made, or an express or implied term, the existence and effect of which have been notified to the employee in writing before the deduction is made.

Like many employees have shared the letter on social media, most employers would possibly think it is wise to do the same by displaying the letter on the staff notice boards. A general notice on a notice-board is not sufficient.

The prior consent must be given individually by each affected employee. The courts will always want clear written evidence and or consent given before the event giving rise to the deduction, not just before the deduction itself.

An employee whose wages are unlawfully deducted in response to Covid 19 letter from the Office of the Prime Minister is entitled to claim for an unlawful deduction from his or her wages or an unlawful payment to the employer via a claim to an employment tribunal.

The aggrieved employer can seek a declaration claim payment (or repayment) of the sum unlawfully deducted by the employer, and in some cases compensation for further financial loss.

Mr Ddumba is a lawyer based in the UK
tomddumba@gmail.com @tomddum