TSC One-Third (1/3) Rule and Check-off Facility
TSC One-Third (1/3) Rule and the Check-off Facility are important aspects of employment regulations that govern deductions and financial obligations between employers, employees, and third-party organizations.
In this article, Teachers Updates will delve into the details of these rules and guidelines, shedding light on their significance and implications for all parties involved.
- Explaining the One-Third (1/3) Rule: The TSC One-Third (1/3) Rule stipulates that deductions from an employee’s basic salary, whether statutory or voluntary, should not exceed two-thirds (2/3) of their total salary. This regulation, outlined in the Employment Act (2007), serves to protect employees’ rights and ensure they have enough income to meet their financial obligations beyond the deductions.
- Responsibility of Third Parties: According to the regulations, it is the responsibility of third-party organizations to ensure that any proposed deductions from individual employees comply with the one-third (1/3) requirement. These organizations must confirm the employee’s ability to fulfill their financial obligations before initiating any deductions.
- Trade Union Dues and Agency Fee: Trade unions that have signed recognition agreements with the Commission are entitled to have their dues deducted from the salaries of their members who voluntarily join the union. This deduction follows the guidelines provided in Part VI of the Labour Relations Act (2007). Additionally, an agency fee may be deducted from the salary of non-union employees who benefit from a Collective Agreement negotiated between the union and the Commission.
- Stop Order and Employee Liabilities: Third parties are responsible for stopping deductions from an employee’s salary once their liabilities with the firm have been discharged. If a third party fails to stop a deduction as instructed, the Commission has the authority to intervene and stop the deduction based on authenticated instructions from the employee. In cases of overpayment, the excess amount will be recovered from the third party’s subsequent remittance and refunded to the employee.
- Discontinuation of Voluntary Payroll Deductions: Employees have the right to discontinue voluntary payroll deductions by providing a written notification to the third-party firm. However, it’s important to note that this provision does not include the employee’s undischarged liabilities.
- Actions Against Defaulters: Third parties are expected to take necessary actions, including legal measures, to recover any defaulted loans or credit facilities. They are also required to notify any guarantor associated with the defaulted loan/credit facility. Failure to meet financial obligations can be considered an act of misconduct, subjecting the employee to disciplinary action by the Commission.
- Admission and Renewal to the Check-off Facility: Third parties seeking to use the TSC check-off facility must apply to the Commission by completing the prescribed application form and paying the admission fee. Existing third-party organizations must renew their admission every five years by following the application procedure and paying the renewal fee.
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- Service Charge: Third parties are responsible for paying a service charge to the Commission for processing deductions, data, information, reports, and other related services. The applicable rates for the service charge are determined by the Commission and should be fully absorbed by the third party without passing the cost to the employee.
Conclusion:
Understanding the One-Third (1/3) Rule and the Check-off Facility is crucial for employers, employees, and third-party organizations. Adhering to these regulations ensures fair and transparent financial practices, protecting the rights of employees while facilitating necessary deductions. By following these guidelines, all parties can maintain a balanced and harmonious working relationship that benefits everyone involved.
TSC One-Third (1/3) Rule and Check-off Facility
