Consideration may need to be given to the law relating to unlawful deductions from wages, and penalties/liquidated damages clauses. Deductions from wages Under section 27(1) of the Employment Rights Act 1996 (ERA 1996), wages means any sums payable to a worker in connection with their employment, including (among other things) holiday pay, whether statutory or contractual. Under ERA 1996, s 13, an employer cannot make any deductions from the wages of a worker unless: • the deduction is required or authorised to be made by virtue of a statutory provision, eg the requirement to make deductions for income tax or National Insurance contributions via Pay As You Earn (PAYE) • the deduction is required or authorised to be made by virtue of a relevant provision of the worker's contract, eg where the employer provides