Direct earnings attachment for claimants
We are responsible for recovering money owed to it in respect of debts arising under the Social Security Administration Act 1992. Since April 2013, local authorities have been given the power to recover overpaid Housing Benefit by deductions from earnings without the need to apply for a court order. This is done by using a Direct Earnings Attachments (or DEA). Local authorities were given this power by The Social Security (Overpayments and Recovery) Regulations 2013 and The Social Security (Overpayments and Recovery) Amendment Regulations 2015.
Why we use DEAs
DEAs give us the opportunity to recover overpaid benefits from debtors who are employed if they either refuse to repay, are unable to agree an acceptable repayment plan or who have defaulted on a voluntary repayment arrangement.
Employers have a legal obligation to apply the DEA unless they are a micro business and started before 8 April 2013 (having fewer than 10 employees). In such cases employers are not obliged to operate a DEA although they may do so.
Payments counted as earnings
What counts as earnings for DEAs | What does not count |
|---|---|
Wages | Statutory Maternity Pay |
Salary | Statutory Adoption Pay |
Fees | Ordinary Statutory Paternity Pay |
Bonuses | Additional Statutory Paternity Pay |
Commission | Any pension, benefit, allowance or credit paid by DWP, a local authority or HMRC |
Overtime pay | A guaranteed minimum pension under the Pensions Scheme Act 1993 |
Most other payments on top of wages | Amounts paid by a public department of the Government of Northern Ireland or anywhere outside the United Kingdom |
Occupational pensions, if paid with wages or salary | Sums paid to reimburse expenses wholly and necessarily incurred in the course of employment |
Periodic payments by way of compensation for the loss, abolition or relinquishment or diminution in the emoluments of any office or employment | Pay or allowances as a member of Her Majesty’s forces, other than pay or allowances payable to them by you as a special member or a reserve force |
Statutory Sick Pay | Lump sum redundancy payments in lieu of notice |
Net earnings
Your employer must take the amount for the Direct Earnings Attachment directly from your net earnings. Net earnings are the earnings left after deduction of:
- Income Tax
- class 1 National Insurance contributions
- contributions to a work place pension (including additional voluntary contributions, free standing additional voluntary contributions and stakeholder pension contributions)
Amounts to be deducted
Table A - weekly earnings (standard rate)
Amount of net earnings | Deduction (% of net earnings) |
|---|---|
Less than £100 | Nil |
Exceeding £100 but not exceeding £160 | 3% |
Exceeding £160 but not exceeding £220 | 5% |
Exceeding £220 but not exceeding £270 | 7% |
Exceeding £270 but not exceeding £375 | 11% |
Exceeding £375 but not exceeding £520 | 15% |
Exceeding £520 | 20% |
Table B - monthly earnings (standard rate)
Amount of net earnings | Deduction (% of net earnings) |
|---|---|
Less than £430 | Nil |
Exceeding £430 but not exceeding £690 | 3% |
Exceeding £690 but not exceeding £950 | 5% |
Exceeding £950 but not exceeding £1,160 | 7% |
Exceeding £1,160 but not exceeding £1,615 | 11% |
Exceeding £1,615 but not exceeding £2,240 | 15% |
Exceeding £2,240 | 20% |
Table C - weekly earnings (other rate)
Amount of net earnings | Deduction (% of net earnings) |
|---|---|
£100 or less | 5% |
Exceeding £100 but not exceeding £160 | 6% |
Exceeding £160 but not exceeding £220 | 10% |
Exceeding £220 but not exceeding £270 | 14% |
Exceeding £270 but not exceeding £375 | 22% |
Exceeding £375 but not exceeding £520 | 30% |
Exceeding £520 | 40% |
Table D - monthly earnings (other rate)
Amount of net earnings | Deduction (% of net earnings) |
|---|---|
£430 or less | 5% |
Exceeding £430 but not exceeding £690 | 6% |
Exceeding £690 but not exceeding £950 | 10% |
Exceeding £950 but not exceeding £1,160 | 14% |
Exceeding £1,160 but not exceeding £1,615 | 22% |
Exceeding £1,615 but not exceeding £2,240 | 30% |
Exceeding £2,240 | 40% |
Protected earnings level
The total of all deductions (the DEA plus any other deductions in place) cannot leave you with less than the protected earnings proportion, which is 60% of your total net earnings during the calculating period to which the deduction relates.
Employees who are paid every two weeks
If you are paid two weekly, the total net wage is divided by 2 and table A or C is used to check the percentage rate.
Employees who are paid every four weeks
If you are paid four weekly, the total net wage is divided by 4 and table A or C is used to check the percentage rate.
Holiday Pay
If you are paid a wage which includes holiday pay paid in advance, the net wage is averaged and the percentage rate applied to the average figure. For example:
The employee received one week’s wage and two weeks holiday pay. Total net payment for three weeks = £850.
£850 ÷ 3 = £283.33
£283.33 x 11% = £31.17
Total deduction from the net wage for three weeks of £850 = £93.51 (£31.17 x 3).
Administrative costs
£1 may be deducted from your earnings towards administrative costs for each pay period when the DEA deduction is calculated. Your employer can take this even if it reduces your income below the protected earnings proportion.
Employer deductions
If the employer fails to take a deduction from your net earnings when they should have or takes an incorrect amount they should correct this on the next payday or paydays.
Where the incorrect amount is because the deduction was less that the amount specified under the regulations then they should first:
- deduct the amount required for the current pay period.
- then include the difference between the incorrect and correct amount for the previous period.
Where the incorrect amount is because the deduction was more than the amount specified under the regulations then they should first:
- deduct the amount required for the current pay period.
- then reduce that deduction amount by the excess previously taken.
Other court orders
Courts can make orders that mean employers must take money directly from your earnings in a similar way to how we ask your employer to make deductions for a DEA. For example, you may have an Attachment of Earnings Order or a Deduction from Earnings Order (for child maintenance). The DEA can be imposed without a court order, but if you have any other deduction orders against you there are rules that tell employers which money they should take first.
If you have one or more of the following in place they will take priority:
England and Wales
- Deduction from Earnings Order (DEO) from the Child Maintenance Group (CMG)
- Attachment of Earnings Order (AEO) for Maintenance or Fines
- Council Tax Attachment of Earnings Order (CTAEO)
Scotland
- Deduction of Earnings Order (DEO) from CMG
- Earnings Arrestment (EA)
Student loans
A student loan repayment also takes priority over a DEA. This applies to both England, Wales and Scotland. Once these priority orders have been taken into account in your calculation a DEA will then take priority in relation to other orders or notices in date order (in Scotland this will be the date they were received). The amount to be deducted will be subject to the available net earnings above the protected earnings limit of 60% of net earnings.
Other information
If the weekly or monthly earnings are below the threshold (see table A, B, C and D) the DEA deduction cannot be calculated and we must be advised of this.
If you think that the amount of money you owe is wrong, please contact us 01622 602311. If you are struggling with the deductions please contact us. However this action is being taken because you have failed to contact us regarding repayment of the debt and it is therefore unlikely that this action will be suspended or ceased unless payment of the invoice is made in full.