garnishment question

sandra_d · July 2005

We have an employee who owes their share of insurance premium going back the last 3 pay periods, and totals around $800. As we collect that money out of her paychecks going forward, are we able to collect what we believe to be "fair" or are we subject to the same withholding limits of a formal garnishment? (If we're subject to the garnishment guidelines, we'll only be able to take about $30/check so will take forever to re-claim that $800!!)

Anyone know our obligations/rights?

marc · July 2005

You cannot take anything out of the EEs check without their specific, signed authorization. If he/she will not agree to your suggestion, then you have to act like any other creditor and go through the courts to get it done.

You must have had a situation where the EE was without a check for a period of time, but you maintained the insurance coverage anyway. I suppose you could look into cancelling the insurance coverage for non-payment.

lorrie · July 2005

As I recall you can deduct a debt owed to the employer as long as it does not drop the employee below minimum wage. (Although I am not familiar with all of the other garnishment rules that might apply.)

But you can set time limits for employees to pay back their share of the health insurance. If it is too much to deduct, you can require them to pay you cash by a certain date or drop their coverage.

marc · July 2005

lorrie, I have to disagree with respect to employment debt. If this is a general debt, employee advances, equipment that has been checked out to the EE and lost or damaged; those types of debt cannot just be deducted from the EEs paycheck without specific, signed authorization.

With respect to the health insurance, it is a little different situation, since most EEs have already authorized the deduction when they signed up for the program. The problem is that the authorization signed is usually a specific amount per paycheck. That authorization works until the EE misses a couple of checks, but the coverage is maintained, creating the greater obligation.

I maintain that the signed authorization is for the deduction is not sufficient to allow the EE to "catch up" on the payments without the EE approving the different, greater monthly amount.

lorrie · July 2005

You are right about needing the employee to sign an authorization for the deduction, regardless of the amount. I was just thinking about how much could legally be withheld, but regardless of the amount, the ee must agree and sign an additional authorization. Sorry my answer was not very clear.

When we have an ee owe us for past health ins. I provide them with a bill/authorization for deduction. It states how much they owe and a deadline for payment before health coverage is terminated. It gives them options to check: cash payment enclosed, or authorization for additional payroll deduction (in addition to the authorization for current premiums.)

Brad Forrister · July 2005

This is an area that turns on state law.

Here's what our 50x50 book says on paycheck deductions in MN:

Employers are allowed to make paycheck deductions for claimed indebtedness (including deductions for faulty workmanship, theft, loss, etc.) if the employee voluntarily authorizes the withholding. Exceptions include when a collective bargaining agreement overrides the statutory restrictions, rules established for disciplining commissioned salespersons for acts and omissions that override the restrictions, and when employees make purchases and receive loans from the employer and authorize withholding. Also, employers and employees can enter written contracts for deductions for such purposes as union dues, charitable contributions, credit union deposits, etc.

Citation: M.S.A. §§ 181.06, Subd. 2 and 181.79.

Brad Forrister
VP/Content
M. Lee Smith Publishers

durasupreme · July 2005

>This is an area that turns on state law.
>
>Here's what our 50x50 book says on paycheck
>deductions in MN:
>
>Employers are allowed to make paycheck
>deductions for claimed indebtedness (including
>deductions for faulty workmanship, theft, loss,
>etc.) if the employee voluntarily authorizes the
>withholding. Exceptions include when a
>collective bargaining agreement overrides the
>statutory restrictions, rules established for
>disciplining commissioned salespersons for acts
>and omissions that override the restrictions,
>and when employees make purchases and receive
>loans from the employer and authorize
>withholding. Also, employers and employees can
>enter written contracts for deductions for such
>purposes as union dues, charitable
>contributions, credit union deposits, etc.
>
>Citation: M.S.A. §§ 181.06, Subd. 2 and 181.79.
>
>
>Brad Forrister
>VP/Content
>M. Lee Smith Publishers

So please clarify Brad, since I'm also in MN and we've run into similar situations, what is the proper way to "catch up" the missed insurance premium deductions?

garnishment question

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