All WRS Employers
Vol. 22, No. 7
April 15, 2005
New Critical Information From Social Security: Wage Garnishment
DEBT COLLECTION IMPROVEMENT ACT OF 1996
Effective on or about April 15, 2005, Social Security will begin
using administrative wage garnishment to collect delinquent debts
owed by former beneficiaries of the Social Security and Supplemental
Security Income (SSI) programs. Wage garnishment is a process in
which an employer withholds up to 15% from an employee’s disposable
wages and pays that money to the employee’s creditor until
the debt is paid or otherwise resolved. Administrative wage garnishment
is authorized by the Debt Collection Improvement Act of 1996 and
does not require a court order. The final regulations for the administrative
wage garnishment became effective in 2004.
In February 2005, Social Security notified debtors that wage garnishment
may be used to collect debts and offered debtors the opportunity
to dispute the debt or repay it before garnishment begins. For debtors
failing to respond to the notice, Social Security will determine
the debtor’s employer and begin mailing garnishment orders
to employers on or about April 15, 2005.
Please note that employers failing to comply with a wage garnishment
order can become liable for amounts that should have been withheld
from the worker’s pay as well as punitive damages. Also, employers
cannot fire or take disciplinary action against an employee on the
basis of wage garnishment.
Social Security will send a monthly notice to employers with updates
on the status of the debt. Employers having questions regarding
a wage garnishment order should contact Social Security at the telephone
number shown on the order.
If you would like additional information regarding this process,
visit the Social Security Internet site www.socialsecurity.gov/employer
and click on Administrative Wage Garnishment at the In the News
Please share the information in this bulletin with those responsible
for complying with wage garnishment orders. Your assistance in collecting
this debt will benefit the nation’s Social Security and SSI
programs, which provide needed assistance to millions of elderly
and disabled people and their families.
Employers with questions about this bulletin should contact ETF’s
Employer Communication Center at (608) 264-7900.