In the Payroll Mailbag: February 2018

Name/SSN mismatch: Short circuiting a creditor garnishment

Question: We received a creditor garnishment from a Nebraska court that seems to relate to an employee. The Social Security number is correct, but neither the first nor last names on the summons match our employee’s name. She says that she’s aware of the garnishment, that it doesn’t concern her and that she can’t get the creditor to provide documentation that it’s suing the wrong debtor. Must we honor the summons? We don’t do business in Nebraska.

Answer: In general, a creditor can commence a garnishment action in any state court in which a debtor’s employer has business operations. It seems here, however, that the creditor made more than one sloppy mistake. You should still answer the summons, but you should specify to the court that issued the summons that it has no jurisdiction over you (and by extension the employee), since you have no business connection with Nebraska.

Are we allowed to deduct for lost security badges?

Question: The company recently upgraded its security systems and now employees must swipe a card to get into the building. HR wants to charge employees who lose their cards $100 for replacement cards. I’m not sure we can even make these types of deductions. Can you help?

Answer: Loss-related deductions can be made from nonexempts’ pay, provided your state’s wage payment law allows it and your deductions don’t cut into their overtime pay.

You generally can’t make deductions from exempts’ pay, unless the deduction relates to an infraction of a safety rule of major significance: a rule that’s meant to prevent serious danger in the workplace. Security passes could fall under this exception, since unauthorized people in the building could present a threat to all employees. Hitch: Safety rules of major significance and workplace conduct rules are vague phrases.

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You should obtain the advice of your company’s attorney before docking exempts’ pay.

Note: In most states, employees must consent in writing and in advance to have deductions made from their wages, if those deductions are for the employer’s benefit.