Underpaid - wage garnishments were incorrectly calculated by payroll for three months

[schrodingerscat]

What is the name of your state (only U.S. law)? California

I'm a current part-time employee for a company. When I started working for them, they received a letter from the CA Franchise Tax board stating that I owe back taxes and that my wages are to be garnished based on the information that they provided. Here's the information based on which payroll was suppose to garnish my wages.

(1) If the earnings are between $0-$435 (after taxes) on a "Biweekly" salary -- which I'm on -- then no wages are suppose to be garnished.

(2) If the amount received is between $435.01-$580.00 (after taxes), then any amount above $435 should have been taken.

(3) If earnings received are over $580.01 (after taxes) then 25% of this amount is to be garnished.

After going through my paychecks, I found out that I've been paid incorrectly since November 2013. Instead of following the guidelines above, payroll took a flat 25% from every paycheck I received. Because I'm a part-time worker, most of my pay-checks fell in either the under $435 category or between $435.01 and $580 category. So based on my calculations, because of these incorrect calculations by payroll, I was underpaid by total of almost $400 since November 2013, an amount which equals to the average paycheck that I receive. In other words, this is equivalent to me working for two weeks without any pay.

I have contacted payroll with this information and asked them to pay me the money that they underpaid. However, they told me that they will not do that and if I have a problem with that, then I should contact the State of California. I was pretty shocked at how carelessly and rudely they responded. If my understanding of the previously-mentioned wage garnishment specifications are correct, the reason why the State of California created this criteria is to ensure that an employee earns at least minimum wage required to live. Otherwise, if a flat 25% was to be taken from any paycheck, regardless of the amount, this would mean that a person might not have enough to survive. Thus, doesn't this mean that if payroll is incorrectly garnishing my wages, then they're paying me below minimum wage?

I would appreciate any assistance on this issue. Please let me know the options that I have in this situation. Is there any law that supports my case and the situation that I have? Is there any law that states that an employer must compensate me for the wages that they underpaid me? Should I contact Division of Labor Standards Enforcement (the Labor Commissioner's Office) of the State of California regarding this? Is there anything else that I should do?

Thank you for your help!

 

[Zigner]

Hey, at least your debt has been reduced, right?

 

[Proserpina]

What is the name of your state (only U.S. law)? California

I'm a current part-time employee for a company. When I started working for them, they received a letter from the CA Franchise Tax board stating that I owe back taxes and that my wages are to be garnished based on the information that they provided. Here's the information based on which payroll was suppose to garnish my wages.

(1) If the earnings are between $0-$435 (after taxes) on a "Biweekly" salary -- which I'm on -- then no wages are suppose to be garnished.

(2) If the amount received is between $435.01-$580.00 (after taxes), then any amount above $435 should have been taken.

(3) If earnings received are over $580.01 (after taxes) then 25% of this amount is to be garnished.

After going through my paychecks, I found out that I've been paid incorrectly since November 2013. Instead of following the guidelines above, payroll took a flat 25% from every paycheck I received. Because I'm a part-time worker, most of my pay-checks fell in either the under $435 category or between $435.01 and $580 category. So based on my calculations, because of these incorrect calculations by payroll, I was underpaid by total of almost $400 since November 2013, an amount which equals to the average paycheck that I receive. In other words, this is equivalent to me working for two weeks without any pay.

I have contacted payroll with this information and asked them to pay me the money that they underpaid. However, they told me that they will not do that and if I have a problem with that, then I should contact the State of California. I was pretty shocked at how carelessly and rudely they responded. If my understanding of the previously-mentioned wage garnishment specifications are correct, the reason why the State of California created this criteria is to ensure that an employee earns at least minimum wage required to live. Otherwise, if a flat 25% was to be taken from any paycheck, regardless of the amount, this would mean that a person might not have enough to survive. Thus, doesn't this mean that if payroll is incorrectly garnishing my wages, then they're paying me below minimum wage?

I would appreciate any assistance on this issue. Please let me know the options that I have in this situation. Is there any law that supports my case and the situation that I have? Is there any law that states that an employer must compensate me for the wages that they underpaid me? Should I contact Division of Labor Standards Enforcement (the Labor Commissioner's Office) of the State of California regarding this? Is there anything else that I should do?

Thank you for your help!

There a different rules for tax debts.

Take a look here: http://www.dol.gov/compliance/guide/garnish.htm

Specifically:

Title III permits a greater amount of an employee’s wages to be garnished for child support, bankruptcy, or federal or state tax payments. Title III allows up to 50 percent of an employee's disposable earnings to be garnished for child support if the employee is supporting a current spouse or child, who is not the subject of the support order, and up to 60 percent if the employee is not doing so. An additional five percent may be garnished for support payments over 12 weeks in arrears.

And

Title III’s restrictions on the amount of wages that can be garnished do not apply to certain bankruptcy court orders and debts due for federal and state taxes. Nor do they affect voluntary wage assignments, i.e., situations where workers voluntarily agree that their employers may turn over a specified amount of their earnings to a creditor or creditors.

 

[schrodingerscat]

There a different rules for tax debts.

Take a look here: http://www.dol.gov/compliance/guide/garnish.htm

Specifically:



And

Thank you for your help, Proserpina! I read the information you provided with the link regarding Title III, Consumer Credit Protection Act (CCPA).

First to answer the quotes you brought up: (1) "Title III permits a greater amount of an employee’s wages to be garnished for child support, bankruptcy, or federal or state tax payments..." and (2) "Title III’s* restrictions on the amount of wages that can be garnished do not apply to certain bankruptcy court orders and debts due for federal and state taxes...". I do not have any child support nor bankruptcy. If I'm understanding correctly, these garnishments were taken based on a state tax that is owed, then I'm not covered under Title III? However, the state clearly wrote specific guidelines based on which wages were suppose to be garnished. Thus then this doesn't apply. Isn't this correct? Also, I'm not quite clear with that since the paragraph on that Title III page clearly states:

Title III also protects employees by limiting the amount of earnings that may be garnished in any workweek or pay period to the lesser of 25 percent of disposable earnings or the amount by which disposable earnings are greater than 30 times the federal minimum hourly wage prescribed by Section 6(a) (1) of the Fair Labor Standards Act of 1938. This limit applies regardless of how many garnishment orders an employer receives. The federal minimum wage is $7.25 per hour effective July 24, 2009.

This explains why no garnishments are taken below the $435 bi-weekly salary, which was also instructed by CA Franchise Tax board. Thus, since they didn't follow these instruction, doesn't this mean that the wages were garnished incorrectly?

This is becoming confusing to me.

Now even if Title III doesn't cover my case, this is a federal law and from what I know California has strong employee protection laws. Am I correct on this? Is there something that can help me here? Anything form the state level or anything else?

The issue is that payroll did not follow the specific instructions that they were given by CA Franchise Tax Board. There were no agreements and I did not consent to getting more wages garnished.

Thank you!

 

[swalsh411]

Let's just say that you did have too much deducted, where does that get you?

Clearly you have not starved to death between November and now, so you have had enough money to live. This is extra money you should have been using to pay down your tax debt. So what does it matter whether it was taken out of your check or you paid it on your own?

 

[schrodingerscat]

Hello Swalsh! Thank you for your response! Here are my answers to your questions.

Let's just say that you did have too much deducted, where does that get you?

It gets me underpaid by almost two weeks worth of salary. This is the point of my post.

Clearly you have not starved to death between November and now, so you have had enough money to live.

You're kidding me, right? You don't know a bit about me nor my living situation, nor my struggles and you're making a judgement and a statement like that? How do you know? How is that "clear" to you?

This is extra money you should have been using to pay down your tax debt. So what does it matter whether it was taken out of your check or you paid it on your own?

Yes, it does matter. Because I currently need money to survive and this is what I'm trying to do. The fact that I "owe" anything to CA Franchise Tax board is another issue, which I will tackle separately once I'm able to get my head above water.

I really appreciate any constructive input you all can give me; however, if you're planning to insult me or make jokes of my situation, please don't waste you're time and mine. I created this post to get legal assistance, not advice from clairvoyant psychics.

 

[swalsh411]

It gets me underpaid by almost two weeks worth of salary. This is the point of my post.

You weren’t underpaid. It just went to pay a debt you didn’t feel like paying right now.

How is that "clear" to you?

It’s clear that you have managed to remain alive between November and now despite this alleged over garnishment.

Yes, it does matter. Because I currently need money to survive and this is what I'm trying to do. The fact that I "owe" anything to CA Franchise Tax board is another issue, which I will tackle separately once I'm able to get my head above water.

You should be grateful. Paying is off sooner rather than later is less interest you will owe.

You should consider getting a second job to get this monkey off your back.

 

[schrodingerscat]

Any legal advice would be greatly appreciated. Thank you for your help!

 

[Zigner]

You're welcome.

 

[Proserpina]

Thank you for your help, Proserpina! I read the information you provided with the link regarding Title III, Consumer Credit Protection Act (CCPA).

First to answer the quotes you brought up: (1) "Title III permits a greater amount of an employee’s wages to be garnished for child support, bankruptcy, or federal or state tax payments..." and (2) "Title III’s* restrictions on the amount of wages that can be garnished do not apply to certain bankruptcy court orders and debts due for federal and state taxes...". I do not have any child support nor bankruptcy. If I'm understanding correctly, these garnishments were taken based on a state tax that is owed, then I'm not covered under Title III?

You're covered, but with different rules.

However, the state clearly wrote specific guidelines based on which wages were suppose to be garnished. Thus then this doesn't apply. Isn't this correct? Also, I'm not quite clear with that since the paragraph on that Title III page clearly states:



This explains why no garnishments are taken below the $435 bi-weekly salary, which was also instructed by CA Franchise Tax board. Thus, since they didn't follow these instruction, doesn't this mean that the wages were garnished incorrectly?

This is becoming confusing to me.

Now even if Title III doesn't cover my case, this is a federal law and from what I know California has strong employee protection laws. Am I correct on this? Is there something that can help me here? Anything form the state level or anything else?

The issue is that payroll did not follow the specific instructions that they were given by CA Franchise Tax Board. There were no agreements and I did not consent to getting more wages garnished.

Thank you!

You've got a point there. When a state has rules which differ from the Federal rules, the state is supposed to use the lesser amount.

Stand by please!

 

[schrodingerscat]

You're covered, but with different rules.




You've got a point there. When a state has rules which differ from the Federal rules, the state is supposed to use the lesser amount.

Stand by please!

Great! I'm glad that we're onto something here!

 

[Proserpina]

Who do you owe? California state, or the IRS?

 

[schrodingerscat]

Who do you owe? California state, or the IRS?

To California state.

 

[OHRoadwarrior]

http://www.dir.ca.gov/dlse/faq_deductions.htm

Knock yourself out. I suspect your hours will be cut even further due to changing business needs.

 

[davew128]

Guys, he clearly owes an FTB debt (stated in first post). FTB has specific guidelines which payroll must follow on forced garnishment. OP actually posted the correct rules. I'm not entirely sure what the remedy is unless the garnishment ended up exceeding the amount owed (which CAN happen if payroll isn't too swift). As others have pointed out, the question is what are your damages? Clearly payroll has a bunch of monkeys at the helm so asking them to fix the error going forward is a waste of time.