Social Security will begin in April to use administrative wage garnishment to collect delinquent debts owed by former beneficiaries of the Social Security and Supplemental Security Income (SSI) programs. Administrative Wage Garnishment was authorized by the Debt Collection Improvement Act of 1996 (DCIA) and allows Federal agencies to use non-judicial wage garnishment to collect delinquent debts.

Wage garnishment is a process in which an employer withholds up to 15 percent from an employee's disposable wages and pays that money to the employee's creditor until the debt is paid, or otherwise resolved.

Social Security's final regulations for administrative wage garnishment became effective in 2004 and notices to debtors were mailed in February 2005 telling them that Social Security proposes to use wage garnishment and giving them an opportunity to dispute the debt owed or repay it before garnishment begins. If a debtor does not respond to the notice, Social Security will screen earnings records to determine the debtor's employer. The first garnishment orders will be mailed to employers on or about April 15, 2005.

An employer that does not comply with the wage garnishment order can become liable for any 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 notice to employers each month explaining the status of the debt. If employers have any questions when they receive a wage garnishment order, they should contact Social Security at the telephone number shown on the order. Answers to a series of Frequently Asked Questions are available.

Discuss this news item in the PayPerShop Forum

...back to 3 February 2005

Further information:
www.ssa.gov/employer/AWG-IntheNews.doc
ssa-custhelp.ssa.gov/...