19/03/2026
The promulgation of the Punjab Labour Code, 2026 has significantly altered the dynamics between employers and employees, particularly in matters relating to wage deductions, leave management, and dispute resolution. In recent months, a growing trend has emerged where employees are increasingly threatening employers with complaints before the Payment of Wages Authority and Labour Courts, even in situations involving lawful deductions such as unapproved absences, late arrivals, or habitual misconduct.
In one such matter that I recently handled while representing an employer, an employee attempted to use the threat of legal proceedings as a pressure tactic to avoid legitimate salary deductions. The employee had a documented history of unauthorized leave and persistent late coming, despite repeated warnings and internal disciplinary notices. Nevertheless, the employee sought to characterize the lawful deduction of wages as an illegal act, and attempted to coerce the employer into reversing the deductions by threatening to initiate proceedings under the Punjab Labour Code.
It is important to emphasize that the Labour Code does not prohibit employers from making lawful deductions. On the contrary, it expressly allows deductions in cases of absence from duty, late attendance, and other forms of misconduct, provided such deductions are made in accordance with company policy and properly documented. Employers retain the managerial prerogative to enforce attendance rules, maintain workplace discipline, and ensure productivity. The law was never intended to be used as a shield for employees who deliberately violate workplace policies or to enable misuse of statutory forums for personal leverage.
