Legal Updates

Employer must notify employee about tax deduction that was not deducted originally from salary

November 6, 2016

An asylum seeker filed a claim for social benefits upon termination of employment. The employee also raised a contention that the employer set-off from his salary, without his knowledge, debts to the Tax Authority and due to failure of the employer to inform the employee of such set-off the employee should not bear the debt.

The Court held that despite many failures by the employer, including non-delivery a notice to the employee on the issue of the set-off, the employee did not prove that he relied on net wages and pay slips show that employee's hourly wage was gross. The employer did not continue to grant tax credits to the employee after receiving notice from the Tax Authority. Under these circumstances, this is not a case where the employer should bear the employee’s taxes in full, but only half of them in the light of the failures by the employer.