Attachment of Earnings

Key points

• From time to time, the courts will serve so-called 'attachment of earnings' orders on employers requiring them to make periodical deductions from an employee's weekly or monthly pay cheque and to forward the money to the collecting officer of the court (section 6(1), Attachment of Earnings Act 1971). Similar legislation applies in Scotland and Northern Ireland.

• An attachment of earnings order may be made:

  1. by the High Court, to secure payments under a High Court maintenance order;

  2. by a county court, to secure payments under a High Court or a county court maintenance order or the payment of a judgement debt; or payments under an administration order;

  3. by a magistrates' court, to secure payments under a magistrates' court maintenance order or the payment of any sum adjudged to be paid by a conviction or the payment of any sum required to be paid by a legal aid contribution order (ibid. section 1).

     Note, however, that an attachment of earnings order cannot be made against payments of statutory maternity pay (SMP).

Contents of order

• Unless made to secure maintenance payments, an attachment of earnings order will specify the whole amount payable under the relevant adjudication (or so much of that amount as remains unpaid), including any relevant costs.

• An attachment of earnings order will also specify the normal deduction rate, that is to say, the rate (expressed as a sum of money per week, month or other period) at which the court thinks it reasonable for the employee's earnings to be applied to meeting his (or her) liability under the relevant adjudication (ie, the conviction, judgement, order or other adjudication from which the employee's liability arises).

• An order will also specify a protected earnings rate, ie, the rate below which, having regard to the employee's resources and needs, the court thinks it reasonable that the earnings actually paid to him should not be reduced (ibid. section 6(5)). Thus, if the employee in question is a piece-worker, whose earnings vary from week to week, the court may order that his take-home pay should not be less than a specified amount. If, for example, the prescribed attachment is £25 a week, and the employee earns an average £130 per week (net of income tax and national insurance contributions, etc), the court may decide that his take-home pay should never be less than £100 a week (his protected earnings rate). If, in any week, his net earnings are less than £125, the employer may only deduct the difference between his net earnings and that protected earnings rate. The shortfall would be carried forward and recovered in ensuing weeks until the full amount is paid to the collecting officer of the court.

Compliance by employer

• If served with an attachment of earnings order, the employer must comply with its terms within seven days (ibid. section 7(1)).

• If the employee in question is no longer employed by the employer, or subsequently resigns or is dismissed, the employer must notify the court of that fact within 10 days of the date on which the order was served or (as appropriate) within 10 days of the date on which the employee left his employ (ibid. section 7(2)).

Example

• John Smith is a salesman with average earnings, after deduction of tax and national insurance contributions, of £400 a week. A county court has served an attachment of earnings order on John's employer directing him to deduct £65 per week from John's pay packet in respect of payments under a maintenance order. The court has decided on a protected earnings limit of £325, which means that his take-home pay must not be less than that amount. As John's income varies from week to week, there will be occasions when his employer must deduct less than £65 so as not to reduce his take-home pay below £325. However, any deficit (or arrears) must be carried forward from week to week. The picture over the first few weeks may be demonstrated by the following table:

  Week No.	Net or 'attachable' earnings	Deductions under the order	Take-home pay	Arrears carried forward
  1	£415	£65	£350	Nil
  2	£410	£65	£340	Nil
  3	£387	£62	£325	£3
  4	£375	£50	£325	£18
  5	£380	£55	£325	£28
  6	£440	£93	£347	Nil

  Every time the employer deducts money from John's wages, in compliance with an attachment of earnings order, he may also deduct £1.00 towards his own clerical and administrative costs which additional deduction (if made) must be listed on the itemised pay statement given to John with his weekly payslip.

Employer's administrative costs

• Each time an employer deducts money from an employee's wages or salary, in compliance with the terms of an attachment order, he is entitled to deducted a further £1.00 towards his clerical and administrative costs (ibid. section 7(4)(a)). This figure is reviewed regularly.

Notification to employee

• Likewise, on each occasion that an employer deducts money from an employee's earnings, in compliance with the terms of an attachment of earnings order, he must provide the employee with a written statement of the total amount of the deduction (ibid. section 7(4)).

Power of court to obtain information

• Before making an attachment of earnings order, a court may order the relevant employer to provide a signed statement giving specified particulars of the relevant employee's earnings and anticipated earnings (ibid. section 14).

Offences

• If an employer fails to comply with an attachment of earnings order, or fails to notify the court that the employee in question is no longer in his employ or has left his employ, or refuses or neglects to provide a statement of the employee's earnings and projected earnings, he is guilty of an offence and liable to a fine of up to £200. Furthermore, if he makes any statement to the court that he knows to be false in a material particular, he may be sent to prison for up to 14 days (ibid. section 23).