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Wages And Salaries Notes

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Payment of wages and salaries Deduction and retention at common law The circumstances under which an employer can withhold all or part of the agreed wage are determined, in the first instance, by the common law. (I) The first issue to consider where is the point at which the employee's contractual right to payment accrues. Where payment is governed by a tme rate of some kind, an employee who has performed the contract as required becomes enttled to payment in respect of that period. There is a distncton to be drawn here between the point at which the right to payment accrues, which is when the performance is completed, and the point at which the wage becomes payable, which may be later. It is standard practce in many employments to pay wages and salaries a week or month in arrears; there is nothing unlawful about this practce, although it would be normal for it to be supported either by an express contract term or by one implied from a collectve agreement or from custom and practce. Notwithstanding this possibility of an interval between accrual and actual payment of the wage, once the right has accrued it cannot be forfeited by anything which the employee does between that point and the tme at which payment falls due (George v Davies), except to the extent that the employee may commit a subsequent breach of contract which gives rise to a counter claim or set off in damages. The right to payment of an hourly-paid worker accrues hour by hour as the work is carried out (subject to the possibility of an employee showing that mere readiness to work suffices). In the case of a salaried employee for whom no tme rate as such is set, the interval between payments - normally a month - becomes important in establishing the point at which the right to payment is earned (Sim). In principle, performance must be rendered in full for each month before any part of the salary for that month (or other period) becomes due e.g. where employees quit or dismissed for breach of contract before the expiry of their fixed term of employment, the courts held that they had no claim for work done either in contract or in quantum meruit (Turner v Robinson). The outcome is sometmes seen as an aspect of the common law doctrine of entre obligatons: the debt or price cannot be apportoned except to the extent that the contract itself provides for this. The courts do not normally imply a term allowing for pro rata payment where to do so would contradict an express agreement (Williams). It is possible that an employee may invoke s 2 of the Apportonment Act 1870 which provides that "all rents, annuites, dividends, and other periodical payments in the nature of income shall be considered as accruing form day to day, and shall be apportonable in respect of tme accordingly"; for this purpose, the term annuites is expressed to include salaries. Although there is evidence that it was not the intenton at the tme this Act was passed to apply this part of it to contracts of employment in general (Mathews), in Sim, Scot J thought that it did apply to the salaries of monthly paid school-teachers which "may be regarded as accruing day by day". The term wages is not mentoned in the 1870 Act and it is unclear whether the Act could apply to non-salaried employees. However, the recent tendency of the courts has been to give the Act a general applicaton to contracts of employment.

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