Oregon Child Support Collections and Fees
Any source of the noncustodial parent’s income, even large lump sums, is subject to Oregon wage garnishment for child support collection purposes. Employers can deduct a small processing fee from an employee’s wages to offset withholding costs; the fee is deducted from the employee’s remaining income, not the support payment. It is extremely important that the employer enforce child support garnishment until the order is satisfied. If the employer does not comply with an order to withhold, the employer will be held liable for the full amount of the support not withheld and subject to fine.
Income Subject to Withholding for Child Support Garnishment
A noncustodial (paying) parent must consider any source or form of income as being subject to child support garnishment. Oregon defines income as any monies owed over $4.99 to an employee, and in the possession of a third party. This amount ($4.99) is after any deductions are made for administrative fees. Income includes wages, salary, commissions, bonuses, payments from a pension or other type of retirement plan, dividends, interest, trust payments, unemployment or disability payments, amounts owed to independent contractors, and any other form of periodic payment. Some of this income is, however, subject to maximum withholding limits.
Bonuses and Other Lump Sum Payments
Withholding on lump-sum payments may be required, especially if the employee owes past due support. To find out if withholding is required, the employer should contact the Oregon Child Support Program Employer Services Unit.
A lump-sum payment includes retirement withdrawals, settlements, severance pay, bonuses, retroactive workers’ compensation benefits, and any other income that is not periodic, but delivered in a lump sum.
Child support can be withheld up to 25% of a lump-sum payment after deductions. Such payments need special attention: their withholding is separate from the withholding that occurs every pay period, and the two should not be combined.
If an employee no longer works for your company, the employer must contact the issuing agency and provide a (1) completed copy of the order, (2) the company name, (3) the employee’s name and last known home address, (4) the date of termination, and (5) the new employer’s name and address, if known.
If the employee retires and will be the recipient of pension plan or other retirement payments, the employer should also list the name of the retirement plan administrator.
When an employee stops working for the employer, the employer is no longer bound by the support order. Thus, it’s important to notify the agency so they can make the necessary changes to the support order.
An Oregon employer may charge up to $5 per month for any costs associated with processing a support order. This fee must come out of the employee’s wages. Further, the total fee and support payment can never exceed Oregon’s maximum withholding limits.
Penalty for Not Following the Income Withholding Order
If an employer does not withhold the child support, the employer may be held responsible for the amount(s) of child support that should have been withheld; or any damages suffered as a result of the failure to remit within the time specified by law; and subject to a civil action for failure to enforce. Additionally, if the employer acted with willful or gross negligence, the employer will be assessed a fine of up to $250 for each instance of noncompliance, in addition to attorneys’ fees.
Oregon State Office of Child Support – Contact Information
Department of Justice
Division of Child Support
1495 Edgewater Street, N.W., Suite 120
Salem, OR 97304
Phone: (503) 373-7300
Fax: (503) 986-6289