Salary Withholding

Overview

Salary Withholding – Business Overview

Salary Withholding is a payroll document used in Dafater to manage and control situations where a portion of an employee’s salary must be temporarily or permanently withheld. It provides a formal, auditable way to pause, reduce, or retain salary payments due to legal, disciplinary, financial, or administrative reasons, while ensuring payroll accuracy and compliance.

Purpose in Business Operations

Salary Withholding is used to: - Record approved decisions to withhold part or all of an employee’s salary
- Ensure withheld amounts are consistently applied during payroll processing
- Maintain transparency and documentation for internal controls and compliance
- Protect the organization from payroll disputes by keeping a clear record of withholding reasons and periods

This document ensures payroll reflects real-world employment decisions without manual adjustments or informal handling.

Prerequisites and Setup Requirements

Before using Salary Withholding, the following should be in place: - The employee must already be active in Dafater
- Payroll structures and salary cycles should be defined
- Internal policies should clearly define when salary withholding is allowed (e.g., disciplinary action, unpaid leave, legal orders)
- Proper authorization procedures should be established, as salary withholding impacts employee compensation

Typical Workflow and Business Process Fit

Decision to Withhold Salary
Management or HR identifies a valid reason for withholding salary, based on company policy or external requirements.
Create Salary Withholding Record
A Salary Withholding document is created, specifying:
- The affected employee
- Withholding period
- Amount or percentage to be withheld
- Business reason for the action
Approval and Validation
The document is reviewed and approved according to company authority levels.
Payroll Processing
During payroll runs, Dafater automatically considers the Salary Withholding and adjusts the employee’s payable salary accordingly.
End or Release of Withholding
Once the withholding period ends or conditions are met, the record ensures normal salary payments resume without manual correction.

Key Business Scenarios Where Salary Withholding Is Essential

Disciplinary Actions
Temporary salary withholding due to policy violations or pending investigations.
Unpaid or Extended Leave
Managing salary impact when employees take leave without pay.
Legal or Regulatory Orders
Court-mandated or government-required salary holds.
Recovery of Dues
Gradual withholding to recover advances, penalties, or company losses.
Administrative Holds
Salary suspension during contract disputes or documentation issues.

Important Considerations for Users

Always ensure salary withholding decisions follow labor laws and company policies
Clearly document the reason to avoid employee disputes
Communicate withholding details to the employee to maintain transparency
Regularly review active Salary Withholding records to avoid unintended over-withholding
Coordinate closely between HR, payroll, and management to ensure accuracy

Salary Withholding in Dafater plays a critical role in maintaining payroll discipline, legal compliance, and financial accuracy while ensuring sensitive salary decisions are handled in a structured and professional manner.

Basic Information

Module: Payroll
Document Type: Other

Fields

Field Name	Label	Type	Required	Options	Description
employee	Employee	Link	✓	Employee	Employee whose salary is subject to withholding.
employee_name	Employee Name	Data		-	Employee full name for reference and reporting.
company	Company	Link		Company	Company responsible for payroll and salary withholding.
posting_date	Posting Date	Date	✓	-	Date when salary withholding is recorded in Dafater.
payroll_frequency	Payroll Frequency	Select		, Monthly, Fortnightly, Bimonthly, Weekly, Daily	Payroll cycle frequency used to calculate withholding periods.
numberofwithholding_cycles	Number of Withholding Cycles	Int	✓	-	Total payroll cycles during which salary will be withheld.
status	Status	Select		, Draft, Withheld, Released, Cancelled	Current workflow status of the salary withholding record.
from_date	From Date	Date	✓	-	Start date for applying salary withholding.
to_date	To Date	Date	✓	-	End date until which salary withholding applies.
dateofjoining	Date of Joining	Date		-	Employee joining date used for payroll eligibility validation.
relieving_date	Relieving Date	Date		-	Employee exit date affecting salary withholding duration.
reasonforwithholding_salary	Reason for Withholding Salary	Small Text		-	Business reason for withholding employee salary.
cycles	Cycles	Table		Salary Withholding Cycle	Detailed breakdown of withholding amounts across payroll cycles.
amended_from	Amended From	Link		Salary Withholding	Reference to the original salary withholding record amended.

Child Tables

Cycles (Salary Withholding Cycle)

Field Name	Label	Type	Required	Options	Description
from_date	From Date	Date	✓	-	Start date of salary withholding period in Dafater.
to_date	To Date	Date	✓	-	End date of salary withholding period in Dafater.
issalaryreleased	Is Salary Released	Check		-	Indicates whether withheld salary has been released in Dafater.
journal_entry	Journal Entry	Link		Journal Entry	Linked Dafater journal entry for salary withholding or release.

Permissions

Role	Read	Write	Create	Delete	Submit	Cancel
System Manager	✓	✓	✓	✓	✓
HR Manager	✓	✓	✓	✓	✓	✓
Employee	✓

DocType	Relationship	Module
Salary Slip	Linked from	Payroll
Company	Links to	Setup
Employee	Links to	Setup
Salary Withholding	Links to	Payroll

Salary Withholding

Overview