Can an employer require a deposit from an employee?

End of the day at the Supérette Nafa: the tills don’t balance, and 18,000 XOF is missing from Awa’s. The manager has an idea: require each cashier to put up a 150,000 XOF deposit, deducted at 25,000 XOF a month from pay. Simple, he thinks. In reality, unlawful: the Code allows a deposit, but through a precise procedure, and every payroll deduction made to build it exposes the employer to a fine.

1. What exactly are we talking about?

Supérette Nafa is a fictitious company with 22 employees in Bamako: its name and situation are used purely as an example.

A security deposit (cautionnement) is a sum of money the employee provides as a guarantee of proper management, for example when handling cash or goods. It covers the employer if the employee causes a loss, and is returned to the employee at the end of the contract if all has gone well.

The Labour Code does not prohibit it. It regulates it strictly: when an employer requires a deposit, the sum is placed with the savings bank, in a special passbook separate from any other passbook the employee holds, and it earns interest at the savings bank’s normal rate (Labour Code, article L.126). The Code sets no ceiling on the amount.

Why this procedure? So that the employee’s money is never mixed with the company’s cash. If the company goes bankrupt or disappears, the deposit remains safe, in the employee’s name.

“The deposit protects the employer. It does not belong to the employer.”

2. The only permitted route: the deposit passbook

The Code describes each step (articles L.127 to L.129).

1. The passbook is opened at the joint request of employer and employee. It bears the stamp “Livret de cautionnement (code du travail art. L-127)”.
2. The employee pays the funds into the passbook personally, then hands the passbook to the employer.
3. The employer issues a certificate of deposit and records the deposit, with the passbook number, in the employer’s register.
4. No withdrawal is possible without the agreement of both, or a decision of the competent civil court authorising one of them (article L.128).

In return, the employer has a preferential right over the sums deposited: it ranks ahead of third parties seeking to seize them, and any attachment made with the public savings institution is automatically void (Labour Code, article L.129).

The most common mistake

Keeping the deposit in cash in the safe, or mixing it with the company’s cash. That is exactly what the Code seeks to prevent: the deposit goes into a passbook in the employee’s name, and nowhere else.

What you need to do

• Open one deposit passbook per employee, at the joint request of both parties.
• Issue a certificate of deposit and record the passbook number in the employer’s register.
• Never keep the deposit in cash or in a company account.

3. Building the deposit through payroll deductions: prohibited

The manager’s plan, deducting 25,000 XOF a month from pay, runs into a general rule: no deduction may be made from pay other than those listed in the Code (Labour Code, article L.121). Statutory deductions cover taxes and contributions, certain repayments for housing or food, and payments provided for by collective agreements (article L.122); building a deposit is not among them.

It is the employee who pays the funds into the passbook personally (article L.127). If a deposit is required, it is agreed at hiring, in the contract, and the employee puts it up with their own money.

What the unlawful deduction costs

Breach of article L.121 is punishable by a fine of 10,000 to 18,000 XOF, and for a repeat offence 20,000 to 50,000 XOF and imprisonment of 6 to 10 days, or one of these two penalties (Labour Code, article L.321). The fine is incurred as many times as there are offences (article L.335). And the sums deducted remain owed to the employee.

Example. Four cashiers, six deductions of 25,000 XOF each:

Sums to be repaid: 4 × 6 × 25,000 = 600,000 XOF
Maximum fines incurred: 24 deductions × 18,000 = 432,000 XOF
Total exposure: 1,032,000 XOF, for a deposit that protected nothing

What you need to do

• Stop immediately any deduction intended to build a deposit.
• Repay the sums already deducted.
• Provide for the deposit in the contract, at hiring, and have the employee put it up in the passbook.

4. When money is missing: what the employer can really recover

Back to the 18,000 XOF missing from Awa’s till. Even with a proper deposit, the employer cannot help itself: withdrawal requires Awa’s agreement or a court decision (article L.128).

Without a deposit, setting off a sum owed by the employee against pay, in particular to make good a loss, is only possible within the attachable portion of the salary (article L.123), whose proportions are set by Decree No. 96-178/P-RM of 13 June 1996 (article D.123-2). And the Code prohibits employers from imposing fines (article L.121): a flat “till penalty” is not compensation, it is a fine. See Pay: what is paid, when, and what can be deducted.

For posts handling cash, there is another route: paying a cash-handling allowance, which rewards that risk. The General Tax Code exempts it from salary tax up to 10% of basic pay. See Cash-handling and management allowance.

The most common mistake

Automatically deducting the whole shortfall from pay. The loss must be established, and set-off remains capped at the attachable portion of the salary.

What you need to do

• Establish the shortfall together with the cashier before any deduction.
• Limit any set-off to the attachable portion of the salary.
• Consider a cash-handling allowance for exposed posts.

A closer look: a deposit is never the price of a job

A security deposit guarantees the management of an employee already in post. It cannot be used to “buy” a job. Fee-charging placement agencies are in fact not allowed to receive or accept deposits of any kind in connection with their operations (Labour Code, article L.305), and workers never have to pay to be placed (article L.304).

Finally, the deposit money belongs to the employee to the end. When the contract ends, if nothing is owed, the passbook returns to the employee with its interest, by agreement of both parties (article L.128). On the other sums to be settled on departure, see Unpaid wages: the employee’s remedies, the employer’s risks.

Key takeaways in 6 points

1. Reserve deposits for posts that justify them and provide for them in the contract at hiring.
2. Have the employee place the deposit in a special savings bank passbook, never in company cash.
3. Issue a certificate of deposit and record the passbook in the employer’s register.
4. Never build a deposit through payroll deductions.
5. Only withdraw the deposit with the employee’s agreement or a court decision.
6. For exposed posts, prefer a cash-handling allowance to deductions.