The proposed rule prescribes the methodology for application of s.
108.225 (16), Stats., and
15 USC 1673, for a third party employer to determine an individual's wages exempt from levy by the department. The proposed rule expresses the calculations necessary to determine the amount of wages excluded from department levy and the maximum amount that may levied by the department to recover benefit overpayments and forfeitures.
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To calculate the maximum levy amount for collecting forfeitures or benefit overpayments involving fraud or concealment, s.
DWD 136.02 provides that the maximum levy amount shall be 25% of the individual's disposable earnings for the pay period unless by levying that amount, the total aggregate of all levies against the individual will exceed 25% of the individual's disposable earnings plus prior levies for the pay period, or exceed the amount by which the individual's disposable earnings exceed 30 times the federal minimum hourly wage for a week or for equivalent pay periods (the federal garnishment protections). If the department cannot take the full 25% levy amount, the proposed rule provides that the department may levy the lesser of the difference between:
• 25% of the individual's disposable earnings plus prior levies for the pay period, and the amount of prior levies in effect for the pay period, or
• the individual's weekly disposable earnings and 30 times the federal minimum hourly wage (or an equivalent pay period).
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To calculate the maximum levy amount for collecting benefit overpayments, s.
DWD 136.03 (1) (a) directs that the department may not levy any amount if the individual's wages are below the federal poverty guidelines. The maximum levy amount shall be 20% of the individual's disposable earnings for the pay period unless by levying that amount, the full levy amount will put the individual's disposable earnings below the poverty guidelines for the individual's household size, or if the total aggregate of all levies against the individual will exceed 25% of the total of the individual's disposable earnings plus prior levies for the pay period, or exceed the amount by which the individual's disposable earnings exceed 30 times the federal minimum hourly wage for a week or for equivalent pay periods (the federal garnishment protections). If the department cannot take the full 20% levy amount, the proposed rule provides that the department may levy the lesser of the difference between:
• the individual's gross earnings and the federal poverty guidelines, or
• 25% of the individual's disposable earnings plus prior levies for the pay period and the amount of prior levies in effect for the pay period, or
• the individual's weekly disposable earnings and 30 times the federal minimum hourly wage (or an equivalent pay period).
The proposed rule defines relevant terms and directs the department to use the guidelines adopted by the judicial conference annually under s.
812.34 (3), Stats., or a comparable table. Finally, the proposed rule establishes amounts to be used in the exemption calculations that are equivalent to 30 times the federal minimum hourly wage for a week (for two-week, semi-monthly and monthly pay periods).
Comparison with federal regulations
In addition to the state exemptions from levy, the federal law,
15 USC 1673, prescribes that the maximum part of the aggregate disposable earnings of an individual for any workweek that is subject to garnishment may not exceed the smaller of the following:
1. 25% of the individual's disposable earnings for that week.
2. The amount by which the individual's earnings for that week exceed 30 times the federal minimum hourly wage in effect at the time the earnings are payable.
Comparison with rules in adjacent states
Iowa's Administrative Code provides that a garnishment of an individual's wages may not exceed the restrictions imposed by the state garnishment law or by the federal Consumer Protection Act,
15 USC 1671 et seq. 875 IAC 217.39. Iowa law provides maximum amounts of an employee's earnings that may be garnished during one calendar year depending on the earnings of the employee.
Michigan law provides that unemployment levies are subject to the same wage protections as the state's garnishment law.
Minnesota law provides for garnishment for delinquent taxes and unemployment benefit overpayments. The maximum garnishment allowed for any one pay period must be decreased by any amounts payable under any other garnishment action.
Illinois provides that unemployment insurance liens may be made against employers, subject to personal property exemptions which have been interpreted to include wages up to $4,000.
Summary of factual data and analytical methodologies
The rule implements the requirements of s.
108.225 (16), Stats., and
15 USC 1673. The Department reviewed forms prepared by the Judicial Conference for implementation of s.
812.34, Stats., regarding exemptions from earnings garnishment based on a judgment debt.
Analysis used to determine effect on small businesses
The substantive provisions are in the statute. The rule merely prescribes the methodology for application of the statutes. Management representatives of the Unemployment Insurance Advisory Council disseminated the worksheet and forms that will be used to implement the rule to businesses for comments. Two comments were received and will be incorporated into the forms.
Initial Regulatory Flexibility Analysis
The rule affects small businesses as defined in s.
227.114 (1), Stats., but does not have a significant economic impact on a substantial number of small businesses.
Fiscal Estimate
Summary
No significant impact was expected from the law change adopting s.
108.226 (16) (am), Stats. The rule implements the statute and no other fiscal impact is expected.
State fiscal effect
None
Types of local governmental units affected
Towns, villages, cities, counties, school districts and WTCS districts.
