Stoppage of Pay to Cover Deficiency definition of Stoppage of Pay to Cover Deficiency in the Free Online Encyclopedia.

Stoppage of Pay to Cover Deficiency

a form of compensation under Soviet labor law for property loss caused to the state or to a cooperative or public organization through misfeasance or malfeasance by responsible officials.

The right to impose stoppage of pay to cover deficiency is vested in the people’s control committees. The procedure for imposing such a penalty is specified in the Rules for Imposing Stoppages of Pay to Cover Deficiencies Through People’s Control Committees, dated Aug. 4, 1969 (Collected Decrees of the USSR, 1969, no. 19, art. 109). Officials are liable within this system for losses incurred by them in such cases as illegal cash payments resulting from incorrect application of piecework rates; adding charges for work included in work orders but not actually completed; overpayments on accounts; illegal payment of rewards, bonuses, grants, or pensions; and illegal expenditures for celebrations, anniversaries, or banquets.

Stoppage of pay is imposed in an amount to correspond to the resulting loss but may not exceed three months’ salary of the official against whom it is assessed. The appropriate sum is collected by the accounting department of the enterprise affected each month from the wages of the official at a rate not to exceed 20 percent of his monthly wage. A stoppage of pay to cover deficiency can be imposed only on the order of a permanent people’s control committee.

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