Under which condition is it unlawful to make deductions from employee wages?

Under which condition is it unlawful to make deductions from employee wages?

• A. To reduce company overhead costs
• B. To benefit the employer or intermediary
• C. To comply with government regulations
• D. To provide health insurance coverage

Answer: (B)

The correct understanding here revolves around the purpose of wage deductions. Making deductions from employee wages to benefit the employer or an intermediary is considered unlawful because it infringes upon an employee's right to their earned wages. The Labor Code typically protects employee compensation from being diminished for the employer's financial advantage or to profit another party without the employee's consent. In contrast, making deductions to comply with government regulations is permitted as it aligns with legal mandates, ensuring compliance with tax laws or other statutory requirements. Similarly, deductions made for health insurance coverage are generally lawful when properly disclosed and agreed upon in an employment contract, as they directly benefit the employee's welfare. Reducing overhead costs, on the other hand, is not a valid reason for wage deductions according to labor laws, as it serves the employer’s financial strategies rather than addressing employee compensation rights.

The correct understanding here revolves around the purpose of wage deductions. Making deductions from employee wages to benefit the employer or an intermediary is considered unlawful because it infringes upon an employee's right to their earned wages. The Labor Code typically protects employee compensation from being diminished for the employer's financial advantage or to profit another party without the employee's consent.

In contrast, making deductions to comply with government regulations is permitted as it aligns with legal mandates, ensuring compliance with tax laws or other statutory requirements. Similarly, deductions made for health insurance coverage are generally lawful when properly disclosed and agreed upon in an employment contract, as they directly benefit the employee's welfare. Reducing overhead costs, on the other hand, is not a valid reason for wage deductions according to labor laws, as it serves the employer’s financial strategies rather than addressing employee compensation rights.