Noncustodial parents who fail to meet their child support payment requirements may see their workers’ compensation benefits garnished. A custodial parent may hire a wage garnishment lawyer and request the court for wage garnishment if they aren’t getting court-ordered payments.
Workers’ compensation replaces someone’s usual wages while recovering from a work-related injury or illness. Those who suffer permanent disabilities from workplace accidents are also eligible for workers’ comp benefits.
How Does Garnishment Work?
The state’s workers’ compensation board or insurance company withholds money from the benefit check of a noncustodial parent. The Worker’s Compensation Board or insurance company forwards that check to the State Division of Child Support Enforcement, from where it gets sent to the custodial parent. This arrangement enables the custodial parent to receive payments without depending on the other parent to deposit the amount themselves.
A federal law enacted in 2006 requires insurance companies to alert the state and agencies responsible for child support enforcement when someone who is behind child support payments makes an insurance claim, including a claim for workers’ compensation benefits. They can do this through the Insurance Match Program. Consequently, the State Division of Child Support Enforcement will receive the claim notice once a noncustodial parent with child support arrears makes a workers’ comp claim.
Other types of income that can garnish for child support are disability benefits, social security, pensions, and retirement benefits. Annual payments, fellowships, and stipends can also be garnished.
When there are Joint Child Support Obligations
When two parents share joint legal responsibility for child support obligations, one parent may sometimes be ordered to pay their portion through wage garnishment. When this happens, the total monthly costs of child support are divided based on the proportion each parent’s income bears to the combined incomes of both parents. When one or both parents goes through a garnishment, only that portion of their wages is subject to withholding.
Each family court has its fee schedule for processing garnishments that reflect which services are paid by the custodial parent and the noncustodial parent.
Receiving Lump-sum Settlement with Child Support Arrears
Once someone with child support arrears gets a lump sum for workers’ compensation, the Division of Child Support Enforcement puts a lien on the settlement. The claimant will get the amount that remains after payment of child support arrears.
If a claimant doesn’t have support arrears, there is a chance that some amount of the money will go towards child support. The lost wages portion of the settlement amount usually gets considered for child support. A noncustodial parent who receives $100,000 in lost wages and child support payments are 20% of the income will have to pay $20,000 to the custodial parent.
Workers Compensation and Divorce
The workers’ compensation benefits may address most of the income problems the recipient will face. It will, however, impact child support based on when the parent gets it. Suppose a noncustodial parent is injured or suffers a work-related illness before the divorce process. In that case, the judge will consider the workers’ comp when calculating the child support amount for the parent.
A noncustodial parent who receives workers’ compensation after a divorce may experience challenges in paying child support. This is especially true if the lost wages portion of the workers’ comp isn’t enough to pay child support in addition to other expenses.
The noncustodial parent can petition the court for child support modification on the grounds of hardship. The judge will evaluate the situation and adjust the payments for the period of workers’ comp payouts accordingly. The noncustodial parent can get a favourable result from their petition for child support modification by working with an attorney knowledgeable in both child support and workers’ comp laws.