UIFSA

CS 156P-2 Direct Income Withholding, Employer Responsibilities

08/13/08 Training Completed 07/19/04

UCA 78B-14-502, 503, 504, 505

 

Statutory Authority

 

If an employer receives a direct income withholding order, s/he must comply with U.C.A. 78B-14-502.

 

“78B-14-502.   Employer's compliance with income withholding of another state.
     (1) Upon receipt of an income withholding order, the obligor's employer shall immediately provide a copy of the order to the obligor.
     (2) The employer shall treat an income withholding order issued in another state which appears regular on its face as if it had been issued by a tribunal of this state.
     (3) Except as otherwise provided in Subsection (4) and Section 78B-14-503, the employer shall withhold and distribute the funds as directed in the withholding order by complying with terms of the order which specify:
     (a) the duration and amount of periodic payments of current child support, stated as a sum certain;
     (b) the person designated to receive payments and the address to which the payments are to be forwarded;
     (c) medical support, whether in the form of periodic cash payment, stated as a sum certain, or ordering the obligor to provide health insurance coverage for the child under a policy available through the obligor's employment;
     (d) the amount of periodic payments of fees and costs for a support enforcement agency, the issuing tribunal, and the obligee's attorney, stated as sums certain; and
     (e) the amount of periodic payments of arrearages and interest on arrearages, stated as sums certain.
     (4) An employer shall comply with the law of the state of the obligor's principal place of employment for withholding from income with respect to:
     (a) the employer's fee for processing an income withholding order;
     (b) the maximum amount permitted to be withheld from the obligor's income; and
     (c) the times within which the employer must implement the withholding order and forward the child support payment.”

 

Multiple Income Withholding Orders 

 

If an employer receives two or more direct income withholding orders for the same non-custodial parent (NCP), the employer must comply with U.C.A. 78B-14-503.

 

“78B-14-503.   Compliance with multiple income withholding orders.
     If an obligor's employer receives two or more income withholding orders with respect to the earnings of the same obligor, the employer satisfies the terms of the multiple orders if the employer complies with the law of the state of the obligor's principal place of employment to establish the priorities for the withholding and allocating income withheld for two or more obligees.

If the employer contacts you regarding the priorities for allocating withheld support, refer to the information below.

 

1.                  Out-of-state employer – to establish priorities for allocating the support withheld, the employer must follow the laws of the NCP’s work state.  The employer may s/he contact the local IV-D agency in that state for the required information.

 

2.                  If a Utah employer contacts you:

a.                   Request the following information about each income withholding order or notice:

i.                     the state that issued the income withholding;

ii.                   the custodial parent (CP)’s name;

iii.                  the person or agency named as payee in the NTW; and,

iv.                 the amount the employer is required to withhold as:

A.                 current support;

B.                 past due support;

C.                 past due medical support; and,

D.                 other support (specify).

b.                  Determine if the employer is able to withhold enough money to pay all or part of the debts.

i.                     Pay all of the debt – if the NCP earns enough money to meet all of his/her monthly support obligation, instruct the employer to deduct the appropriate amounts and send the requested amount to the appropriate state or payee listed in each income withholding order/notice.

ii.                   Pay part of the debt – if the NCP does not earn enough money to meet all of his/her monthly support obligations, determine the amount to be paid towards each debt.

A.                 Full current support - If the full current support debt(s) can be paid, but there is not enough money left to pay all of the arrears debt(s), instruct the Utah employer to:

(i)         divide the remainder equally among all the arrears debt

 

NOTE:  The employer cannot exceed the withholding limit which is listed in each income withholding order.  Generally, this amount is 50% of the NCP’s disposable earnings. 

(ii)        provide each state (or other payee) with a brief written explanation, if the amount remitted is less than the total amount specified in the income withholding order.

            B.         Partial current support - if the NCP does not earn enough money to meet all of his/her current support debt(s), the employer must prorate the amount available based on current due amounts.  For more information, see the example below.
 

EXAMPLE: 

Facts:

1.                  The NCP is paid monthly.  His/her disposable income is $1000. 

2.                  The employer is currently withholding:

·                    $300.00 per month current support for the State of California (CA); and,

·                    $200.00 per month for the State of Wyoming (WY). 

3.         The employer receives a Notice to Withhold from CSS (UT) requesting$200.00 per month:  $100.00 per month current support and $100 per month arrears.

4.         The withholding limit limit on all three orders is 50% of the NCP’s disposable income. 

 

Calculations:

1.         Determine if the total withholding amount for current support can be withheld without exceed 50% of the NCP’s disposable income.

2.         The total amount of current support that should be paid each month is $600.00 ($300.00 CA + $200.00 WY + $100.00 UT = $600).

3.         50% of the NCP’s disposable income is $500.00 (.50 x $1000.00 = $500.00).

4.         Compare the total amount of current support that should be paid each month ($600.00) to the total amount of available disposable income ($500.00). Because the total amount of current support exceeds 50% of the available disposable income amount, current support must be prorated.

5.         Calculate the percentage of current support that should be withheld for each case:

·                    $300.00 (CA) divided by $600.00 (total current support amount owed each month) = .50;

·                    $200.00 (WY) divided by $600.00 = .33 ; and,

·                    $100.00 (UT) divided by $600.00 = .17.

6.         Apply the above percentages to 50% of the NCP’s disposable income amount to determine the appropriate amount to send to each state:

·                    .50 (CA) x $500.00 = $250.00;

·                    .33 (WY) x $500.00 = $165.00;

·                    .17 (UT) x $500.00 = $85.00.

 

Immunity from Civil Liability

 

78B-14-504.   Immunity from civil liability states:
     “An employer who complies with an income withholding order issued in another state in accordance with this part is not subject to civil liability to an individual or agency with regard to the employer's withholding of child support from the obligor's income.”

 

Penalties for Noncompliance

 

An employer (in a UIFSA state) receiving an income withholding order may not:

 

1.                  refuse to withhold money from the NCP’s income;

 

2.                  send the money to the payee designated payee in the income withholding order; or,

 

3.                  contest the direct income withholding.

 

If the employer fails to honor the income withholding, s/he may be subject to the same penalties imposed for noncompliance as stated in U.C.A. 78B-14-505.

 

78B-14-505.   Penalties for noncompliance states:
     “An employer who willfully fails to comply with an income withholding order issued by another state and received for enforcement is subject to the same penalties that may be imposed for noncompliance with an order issued by a tribunal of this state.”

 

If the employer fails to comply with the income withholding order, contact the employer and explain the employer’s responsibility under the laws of the employee/NCP’s work state.  If necessary, you may send the employer a copy of that state’s UIFSA law.  If the employer remains uncooperative, register the income withholding order for enforcement in the employee/NCP’s work state.  The laws and rules of that state govern any enforcement action that may need to be taken against the employer and the other state has personal jurisdiction over the employer.   

 

Fees for Writ of Garnishment

 

Question:  The NCP's employer is withholding $1.16 per weekly pay period as a garnishment processing fee.  The Notice to Withhold was issued by Utah.  The NCP contacted me to review the situation.  Utah Code Annotated 78-7-44 reads:

78-7-44.   Fees for writ of garnishment -- Single or continuing.
(1) Any creditor who serves or causes to be served a writ of garnishment upon the garnishee shall pay to the garnishee:
     (a) $10 for a single garnishment; and
     (b) $25 for a continuing garnishment.
(2) The creditor shall pay the fee directly to the garnishee.

This would make it seem that the employer is in violation of Utah code by withholding a fee on a weekly basis.  However, the matter is complicated by the fact that NCP's primary state of residence and employment is Utah, but NCP's employer is based in Maryland.  The question was whether the employer is subject to the income withholding laws of Utah since that is NCP's primary state of residence and employment, or whether they would be subject to the laws of Maryland since that is their location?

Answer:  OCSE provided the following guidance on which state's laws apply in IM-01-06:

"Under UIFSA's DIW [Direct Income Withholding] provisions, an employer is required to honor an income withholding order sent by another State if the withholding order appears "regular on its face." (See section 502 of the UIFSA Model Act.) The employer is required to comply with terms of the income withholding order with respect to these five elements:

“The obligation's duration and amount (stated in a sum certain);
“The person or agency identified to receive the payment;
“The medical support provisions (cash payment or health insurance);
“The amount of any fees charged by the IV-D agency, the issuing tribunal, or obligee's attorney (stated in sums certain); and
“The arrears and interest payment (stated in a sum certain).

“This same section of UIFSA provides that the employer is to look to the "law of the obligor's principal place of employment" for these three income-withholding elements:

“The fee the employer can charge for processing the income withholding order;
“The maximum amount allowed to be withheld from the obligor's wages (CCPA or State exemption amounts); and
“The timeframes for implementing the income withholding order and disbursing the withheld amounts.

“42 U.S.C. 666(b)(6) adds two additional instances where the income withholding law of the obligor's principal place of employment controls:

“In determining the priorities for withholding and allocating income withheld for multiple child support obligees, and
“In determining any withholding terms or conditions not specified in the order." (Bold added.) (3/06)