Question 1

Employees do not need to be notified when court order with-holdings are requested since they should be aware of the situation already.

Accepted Answer

Employers are typically required to notify employees when they receive a court order for wage garnishments or withholdings, to ensure transparency and allow the employee to take any necessary legal steps.

Question 2

Employers should maintain documentation showing that employees have accepted any required non-statutory deductions.

Accepted Answer

Employers should keep records as proof that employees have agreed to any deductions from their wages that are not mandated by law, to ensure compliance with legal requirements and to resolve any disputes that may arise.

Question 3

Finding out that an employee has an outstanding court order related to unpaid debts can be upsetting to the employer and is grounds for termination of employment.

Accepted Answer

An employee having an outstanding court order related to unpaid debts is not typically considered valid grounds for termination of employment. Employment decisions should be based on job performance and behavior rather than personal financial issues, unless the financial issues directly impact the employee's job duties or the employer's business.

Question 4

If a sales clerk is short on their till at the end of the night, the employer can deduct the amount of the shortage off their next pay.

Accepted Answer

In many jurisdictions, it is illegal for employers to deduct money from an employee's wages for shortages in the till unless the employee has given explicit written consent after the shortage has occurred, and even then, there are often restrictions and conditions that must be met.

Question 5

If a gas attendant is on duty at the time when a customer leaves without paying, the employer can deduct the amount of the lost payment off their next pay.

Accepted Answer

In most jurisdictions, it is illegal for employers to deduct wages for mistakes, shortages, or losses caused by the employee, such as a customer leaving without paying, without the employee's explicit written consent and under specific conditions that do not violate labor laws.

Question 6

If group insurance premiums are partially paid by the employee and the employee has acknowledged this deduction in writing, the employer can deduct the cost directly from each pay.

Accepted Answer

Employers can deduct the portion of group insurance premiums that the employee is responsible for from their pay, given that the employee has agreed to this deduction in writing. This is a common practice in many employment settings where benefits are partially funded by employees.

Question 7

Defined contribution benefit plans are valued by employees because the payment at the retirement is known in advance.

Accepted Answer

Defined contribution plans, such as 401(k)s, do not guarantee a specific payment at retirement; instead, the value depends on contributions and investment performance.

Question 8

Employees bear the risk of market fluctuation when they have defined benefit pension plans.

Accepted Answer

In defined benefit pension plans, the employer bears the risk of market fluctuations as they are responsible for providing a predetermined monthly benefit to retirees, regardless of the investment performance.

Question 9

Employees bear the risk of market fluctuation when they have defined contribution pension plans.

Accepted Answer

In defined contribution pension plans, the contributions are fixed, but the final benefit amount depends on investment performance, thus exposing employees to market risk.

Question 10

Employer optional deductions such as social club memberships should be deducted first, before statutory deductions are made in case the employee runs out of money to cover off the extras.

Accepted Answer

Statutory deductions, such as taxes and social security contributions, must be prioritized and deducted from an employee's pay before any optional deductions like social club memberships. These statutory deductions are mandated by law.

Question 11

Until the money is due, deductions taken off employee payments can be used to cover operating expenses for the business.

Accepted Answer

Deductions from employee payments, such as taxes or retirement contributions, are typically held in trust and must be remitted to the appropriate entities, not used for operating expenses.

Question 12

If gross earnings less statutory deductions for an employee in Ontario with a family support Garnishment Order equal $1500, what is the maximum amount that can be deducted for the Order?

Accepted Answer

In Ontario, the maximum amount that can be garnished for family support is 50% of the employee's net earnings after statutory deductions. Therefore, 50% of $1500 is $750.

Question 13

If gross earnings less statutory deductions for an employee in Ontario with a non-family support Garnishment Order equal $1500, what is the maximum amount that can be deducted for the Order?

Accepted Answer

The answer of If gross earnings less statutory deductions for...

Question 14

What is the maximum amount, by percentage, that a family support order may direct the employer to with-hold?

Accepted Answer

The maximum amount that a family support order may direct the employer to withhold from an employee's earnings for child support or alimony is generally up to 50% of the employee's disposable earnings. This percentage can increase if the employee is not supporting another spouse or child.

Question 15

An employee with an outstanding family support Garnishment Order asks you to allow him to make his RRSP contributions before the available garnishment amount is calculated. You must:

Accepted Answer

Garnishment orders typically require that the garnishment amount be calculated after statutory deductions (like taxes, EI, CPP in Canada) are applied, but before voluntary deductions such as RRSP contributions. This ensures compliance with legal obligations while not allowing for manipulation of the garnishable amount through voluntary deductions.

Question 16

The following is not an example of a statutory deduction.

Accepted Answer

Union dues are not a statutory deduction; they are a type of voluntary deduction agreed upon between the employee and the union. Statutory deductions, such as Employment Insurance Premiums, Provincial Taxes, Canada Pension Plan Contributions, and Federal Taxes, are mandated by law.

Question 17

If an employee disagrees with the terms outlined in a Garnishment Order the payroll administrator should:

Accepted Answer

The payroll administrator must continue to follow the terms of the garnishment order until officially advised otherwise by the court. Garnishment orders are legal documents, and compliance is not optional based on employee disagreement.

Question 18

A Garnishment Order may not be issued by:

Accepted Answer

The answer of A Garnishment Order may not be issued...

Question 19

The following statement is not true regarding employer sponsored Registered Retirement Savings Plans.

Accepted Answer

The statement that the final retirement benefit is known in advance is not true for Registered Retirement Savings Plans (RRSPs) because they are dependent on the contributions made and the investment performance, not a predetermined benefit amount.

Question 20

An employee has a family support order demanding $500 per weekly pay be with-held. If the employee has a gross taxable income of $1000, can the full amount be deducted on this pay?

Accepted Answer

The Consumer Credit Protection Act (CCPA) limits the amount of an employee's earnings that can be garnished in any one week. For child support and alimony, up to 50% of an employee's disposable earnings may be garnished if the employee is supporting another spouse or child, and up to 60% if not. An additional 5% may be garnished for support payments more than 12 weeks in arrears. Therefore, without knowing the specifics of the employee's situation, it's clear that not the full $500 (or 50% of the gross income) can be deducted if it exceeds these federal limits, indicating that the full amount cannot automatically be deducted based on the information provided.

Quiz 5: Employee Payroll and Deduction Policies and Guidelines