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  • Lynne Gaudete
    Participant
    September 5, 2024 at 8:50 am
    Post count: 1
    #93463
    Forum: Community

    Hello. If an employee has a FRO garnishment in place of 50% of their wages, does this include per diem, or is it before per diem? For example, employee is paid and extra $125 per day when having to go out of town for his expenses, or they are paid an extra 15% on their hourly pay for the hours worked out of town to account for expenses incured.
    Does that per diem whether daily or hourly also count toward the garnishment, and is there a difference in the two.

    Thank you

    vickyp
    Keymaster
    September 10, 2024 at 11:46 am
    Post count: 4922
    #93583

    According to the FRO, the maximum deduction is 50% of the employee’s net pay, which is calculated as gross pay minus statutory deductions and reimbursements for expenses (non-taxable).

    The total deduction cannot exceed 50% of the net pay, no matter how much arrears there are in support payments; however, once the support payments + arrears is less than 50% of the net pay, the deduction must be moved to the lower number.

    If the per diem or % increase is being used as an expense reimbursement because it is easier to manage that submitting receipts, that money is not taxable, and therefore should be exempt.

    HR Insider staff

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