Chapter 5 Flashcards
Non-statutory With-holdings Objectives
Determine the amount to be with-held from employees earning based on court orders.
Define employer compulsory with-holdings.
Demonstrate an understanding of with-holdings based on employer allowed deductions.
Court Orders
Generally documented by a Garnishment Order
May be issued by: Federal Court of Canada Ontario Superior Court of Justice Ontario Court of Justice Family Court Branch Small Claims Court
Other legally binding orders
Canada Revenue Agency Direction to Pay
Credit Union Assignment of Wages
Not – “Pay Day” loans and other assignment of wages
When the Court Order is received
If the order is for an unknown or former employee – contact court office immediately to advise them.
Confidentially provide employee with copy
If employee disagrees with order to withhold payroll – advise them to contact court office
If there are questions immediately contact the court office and confirm in writing.
Follow all instructions of garnishment
Calculate and deduct commencing with next pay cycle
If employee has an interruption of earnings – contact court office
There are some specific rules in calculating the court order deduction
- The amount deducted is calculated on:
Gross earnings – (CPP, EI and Income) - There is a limit to the garnishment:
Family support = 50%
Other orders = 20%
Employer Compulsory Deductions
Must be acknowledged in writing by employee.
May include: Union dues and assessments Pension contributions Life insurance and/or other group insurance premiums Social club fees
Employer Compulsory Deductions
Cannot be arbitrary deduction to compensate employer for such things as
Cash shortage
Inventory shortage
Damage to employer property
Uniforms or cleaning
Employer may permit additional deductions on behalf of the employee.
Employee should sign authorization including:
Purpose of deduction Payee Duration of with-holdings Amount to be with-held Total amount to be deducted (if appropriate)
