Processing Garnishments: Communication is the Key
When teaching or speaking about a subject, I try to hone in on a key aspect of the entire topic to direct those learning the material where to focus in on it. If this key aspect can be made clear then all of the subject matter, most of the time, also comes right into focus. So for the topic of processing garnishments I have to ask myself where should the focus lie to ensure that the processing is in compliance as well as efficient? Some might think that this would be difficult question to answer with such a vast topic like garnishments, but actually it is quite simple.
The first area that can be tempting to focus in on is the regulations. With child support it is the states that come into play in most cases. The state regulations are also important when discussing creditor garnishments. So I could focus in on the state regulations. But the states regulations are irrelevant when it comes to federal tax levies and student loans in most cases. So as an overview for the entire topic that wouldn’t work. So should the key aspect be federal regulations instead? Child support is governed overall by federal regulations as are creditor garnishments. But then again does not apply to state tax levies, so again not a key aspect of all garnishments. So what is the key aspect that applies to all garnishments? It is one word…communication!
To process garnishments correctly and efficiently the payroll department must communicate to all parties in all cases. In a nutshell, payroll is the communication hub for all garnishments. It must communicate to the agencies issuing the garnishment and the employee receiving the garnishment. If this communication can be focused sharply the processing can also be focused to ensure compliance. If the department has to explain what is required to be done to the employee or what it has done to the issuing agency, it has focused on the requirements and compliance issues for itself. For example when a federal tax levy is received the employer must communicate with the employee by giving him or her parts of the levy and must ensure that they receive parts of the levy back from the employee. Communication ties into the processing. The employer must also communicate with the IRS with the answer back form when the first payment is processed. This again focuses compliance to ensure the communication is done properly.
Another example of communication being the key is as it applies to child support withholding order processing. Because payroll should communicate with the employee to let him or her know of the withholding order, this forces payroll to focus in on the requirements of the order. For example, what state did the order come from and what state is it going to? This would determine the processing in the payroll department. By communicating the requirements to the employee, the payroll department basically answers its own questions as to how to process the withholding order. By communicating with both the employee and the issuing party, payroll focuses in on its own requirements for processing and thus ensures compliance and efficiency.
The key to processing garnishments is communication, communication, communication!
You can watch my entire 3-part series called “The A-Z of Garnishments” HERE.