ROSELAND, N.J., Sept. 15, 2014 /PRNewswire/
-- ADP®, a leading global provider of human capital
management (HCM) solutions, today revealed findings from a
first-of-its-kind ADP Research Institute® study on
current trends in U.S. wage garnishments. The study found that 7.2
percent of U.S. workers studied have had their wages garnished.
The study also identifies the primary reasons for
garnishments, or debt recovery through pay seizures.
- Over 40% of all garnishments are for child support
- Tax debts account for nearly 20%
Wage garnishments can have a significant impact on both
employees and employers, according to the study. Employees
who have their wages garnished can find it humiliating and
stressful, often resulting in decreased workplace productivity and
motivation. Employers may be exposed to financial risk when
their employees' wages are garnished by becoming liable to
creditors for an employee judgment if they do not assist with the
garnishment appropriately. A lack of data about current
trends in U.S. wage garnishments led the ADP Research Institute to
analyze aggregated, anonymous payroll data from 2013 comprising 13
million employees age 16 and older.
"We conducted this study in order to paint a clearer picture of
current garnishment trends among U.S. workers," said Ahu Yildirmaz,
vice president and head of the ADP Research Institute. "ADP's
robust data set allowed us to bring some clarity to a process that
affects a large number of people, the scope of which has been
poorly understood."
The study also found that the manufacturing sector has the
highest percentage of companies with garnished employees at 48
percent, followed by the transportation and utilities industry at
42 percent. Companies in the professional and business
services, financial activities, and education and health services
industries have the lowest rate at 23 percent for each segment.
This disparity suggests a possible relationship between
garnishment and blue- and white-collar job categories.
Other key findings from the study include:
- The highest garnishment rate is 10.5 percent among employees
age 35 to 44, which is typically the age of peak debt load, child
rearing and divorce.
- Garnishment rates are highest among those earning $25,000-$39,999 per year with 10 percent of these
workers having their wages garnished.
- For nearly all categories of garnishments, the rates are
similar for men and women with the exception of child support: 5.8
percent of male workers versus only 0.6 percent of females. This
finding may reflect that more women than men have physical custody
of children, and men are more likely to be required to pay child
support.
- The Midwest has the highest garnishment rate at 8.9 percent of
employees, compared to the Northeast, which has the lowest rate at
4.9 percent. This disparity may be related to a higher
concentration of manufacturing companies being located in the
Midwest.
"Through helping businesses process wage garnishments, we've
seen the impact they can have on employees and employers alike,"
said Julie Farraj, vice president of
ADP Wage Garnishment Services. "Raising awareness about
garnishments can help employers and employees work together to
manage what sometimes can be a difficult process."
To obtain a free copy of the ADP Research Institute white paper
that outlines the study's key findings, visit Garnishment: The
Untold Story.
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About the ADP Research Institute®
The ADP
Research Institute provides insights to leaders in both the private
and public sectors around issues of human capital management,
employment trends and workforce strategy.
About ADP
With more than $12
billion in revenues and 65 years of experience, ADP®
(Nasdaq: ADP) serves approximately 637,000 clients in more than 125
countries. As one of the world's largest providers of
business outsourcing and Human Capital Management solutions, ADP
offers a wide range of human resource, payroll, talent management,
tax and benefits administration solutions from a single source, and
helps clients comply with regulatory and legislative changes, such
as the Affordable Care Act (ACA). ADP's easy-to-use solutions
for employers provide superior value to companies of all types and
sizes. ADP is also a leading provider of integrated computing
solutions to auto, truck, motorcycle, marine, recreational vehicle,
and heavy equipment dealers throughout the world. For more
information about ADP, visit the company's Web site at
www.ADP.com.
The ADP logo, ADP, and the ADP Research Institute are
registered trademarks of ADP, LLC. All other trademarks are
the property of their respective owners. Copyright © 2014,
ADP, LLC.
Media Contacts:
Dick Wolfe, ADP
(973) 974-7034
dick.wolfe@adp.com
Jill Lewis, Weber Shandwick for
ADP
(952) 346-6279
JLewis@webershandwick.com
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SOURCE ADP