Circular 2002/10 - Attachment of salaries to satisfy a judgment debt

Last updated: 17 Dec 2012

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Purpose

The purpose of this Circular is to advise agencies of the amendment to the Public Service Regulations which took effect on 12 September 2002 regarding the satisfaction of judgment debts.

Background

2. Section 75 of the Public Service Act 1999 (the Act) makes provision for the 'attachment of salaries' (deductions from salary) of APS employees, Secretaries and Heads of Executive Agencies to satisfy judgment debts. The Act provides for regulations to be made and for fees to be charged in relation to the satisfaction of the debt.

3. When the legislative framework was being developed it was intended that the regulations would serve only to set the fee and list the classes of employees whose salaries could be 'attached' leaving it to agencies to develop their own procedures.

4. It has since become evident that the omission of detailed provisions as found in the former Public Service Act 1922, has lead to uncertaintyfor agencies when they are asked to make deductions from salary under section 75 and the associated regulations. To rectify this problem the regulations now provide for a single Commonwealth scheme, applying consistently to affected APS employees, Secretaries and Heads of Executive Agencies in all State and Territory jurisdictions.

Attachment of salaries to satisfy a judgment debt

5. New Part 8A of the Public Service Regulations provides a more detailed scheme under which an agency may make deductions from the salary of certain persons to satisfy a judgment debt and provides that a fee is payable in connection with the deductions.

6. Where a creditor obtains a judgment against a debtor who is an APS employee, a Secretary or Head of an Executive Agency, he or she may approach the employing agency to undertake regular deductions from the employee's net salary to meet the outstanding debt. The creditor is required to pay a fee of $38 to the employing agency.

7. Under the regulations the employing agency will nominate a 'paying officer'. The paying officer may commence deductions at the rate of 20% of the employee's net salary once they have received:

  • a statutory declaration stating that the debt exists and has not been discharged;
  • a certified copy of the judgment; and
  • fees payable to the employing agency.

The paying officer must also notify the debtor that deductions will commence. Provided that no evidence has been received to prove that the debt has been satisfied, deductions may begin.

8. The rate of deductions may be reduced from 20% on the grounds of serious financial hardship or increased at the request of the employee. Any request for variation must be made in writing. Serious financial hardship is not defined by the regulations so may be determined by the paying officer, taking into consideration the financial circumstances of the debtor including their living expenses and other commitments.

9. Where the employee moves from one agency to another, existing arrangements will continue with the new agency, without the need for the creditor to pay an additional fee. The paying officer of the second agency must notify the judgment creditor that the move has taken place and the arrangements for payment.

10. Where there are multiple debts against an employee, the paying officer will process them in order of receipt. Should a payment be made to a creditor that exceeds the amount due under the judgment debt, the creditor must pay the employee the excess.

11 The new regulations are subject to disallowance. Should the regulations be disallowed the APS Commission will distribute the appropriate advice as soon as is practicable.

12. Please find a copy the new regulations attached. A consolidated version of the Public Service Regulations may be accessed at the APS Commission's website.

Further information

13. If you have any questions about this Circular, please contact the APS Commission Helpline on telephone (02) 6202 3859 or email employmentadvice@apsc.gov.au

Julie Smith
Group Manager
Organisational Performance & Values Group

September 2002