Legally, in Australia, the partner cannot deduct money from an employee’s salary regardless of the reason. Even if there was an overpayment by mistake, for example, legally the employer cannot claim that back.
It’s the same with annual leave paid in advance; it’s a liability the client has taken by approving the leave taken in advance. The client has allowed the employee to take more leave than she has available. If an employee is offboarded, it's effectively a loss for the client, which they have accepted by approving that the employee can take leave in advance.
To process the deduction, the employee has to send official signed letter approving the deduction of leave taken in advance from the final payment
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Submitter: Sylwia Struj