Frequently Asked Questions
New Hire Reporting
Q1: How is new hire information used?States match New Hire Reports against their child support records to locate parents, establish a support order or enforce an existing order. This information is also fed into a National Directory of New Hires to provide more current information for locating out-of-state non-custodial parents. Each state has access to this directory so up-to-date information is available regardless of where the parent is located. Nearly one-third of child support cases involve parents who do not live in the same state as their children.
Q2: Why not just use the information on the quarterly wage reporting?Quicker notification is needed to enable child support officials to locate individuals and enforce child support orders. New hire reporting provides up-to-date employment information that can be used to collect child support from individuals who move from job to job. Quarterly data is often out of date before the child support office receives the information. There can be as much as a six-month lag between the time the data is submitted and when it is available to child support officials. Since the data will be significantly more current under New Hire Reporting, non-custodial parents can be located more quickly, allowing child support orders to be established and/or enforced more quickly.
Q3: Which employers need to report new employees under the New Hire Reporting Program?All employers, including private firms, unions, nonprofit and religious organizations, and government agencies, must report all new employees.
Q4: Which employees must an employer report?The rule of thumb is that employers must report all new employees who are required to fill out federal W-4 wage withholding forms. This includes employees who are full time, part time, seasonal, temporary, or rehired after a separation of 180 days or more and student workers.
Q5: Does an employer need to report employees who return from leave or who are rehired after layoff?Yes. The employer must submit a report if an employee is reinstated after any lapse of pay of 180 days or more. However, if the employee remains on the payroll while away from the job, the employer need not submit a report when the employee returns to work.
Q6: Do New Hire Reports need to be submitted for independent contractors and subcontractors?The business/organization must first determine whether there is an employer/employee relationship. If the relationship meets the Internal Revenue Service test for an independent contractor relationship, the business/organization is not required to report. In this case, contractors are responsible for reporting their employees.
Q7: What about temporary or seasonal employees?Employers are required to report temporary and seasonal employees. One exception, however, is employees who are sent to the job site by a temporary employment agency. In these situations, it is the responsibility of the temporary agency, not the business in which he or she is working, to report the individual.
Q8: Must temporary employment agencies report each individual placed by their agency?If the agency is paying wages to the individual, the agency must submit a New Hire Report. The agency needs to report the individual only once, except when there is a break in service with the agency of 180 days or more. If the agency simply refers an individual for employment and does not pay a salary, the agency does not need to file a New Hire Report. However, the employer who actually hires and pays the individual, whether on a part time or full-time basis, is required to report the new hire information.
Q9: Are labor organizations and hiring halls required to report members under the New Hire Reporting Program?Labor organizations and hiring halls must report their own employees (individuals who work directly for the labor organization or hiring hall). If the labor organization or hiring hall simply refers individuals for employment, the labor organization or hiring hall does not need to file a New Hire Report. The employer who puts them on the payroll must report the employee information.
National Medical Support Notice
Q1: What is the National Medical Support Notice?The National Medical Support Notice is a standardized medical child support order used by state child support enforcement agencies to enforce medical child support obligations. The Department of Labor and the Department of Health and Human Services adopted regulations on December 27, 2000, implementing the National Medical Support Notice provisions of the Child Support Performance and Incentive Act of 1998 (CSPIA). (These regulations appear in 29 CFR 2590.609-2 and 45 CFR 303.32.) CSPIA also requires plans sponsored by churches and state and local governments to provide benefits in accordance with the requirements of an appropriately completed notice. For questions with respect to these plans, contact your state child support enforcement agency.
Q2: Does the National Medical Support Notice always come from the Illinois Department of Healthcare and Family Services?No. The law allows every state to serve employers outside their state. The federally mandated form will only be used by state government child support agencies.
Q3: Will the employer packets vary?Yes. The Order/Notice - Income Withholding for Support and the National Medical Support Notice should be the same from every state. The federal government requires that the content and formatting of these forms be standard to make them easily recognizable. However, each state may have different forms/documentation/instructions that accompany the notices.
Additionally, a state agency will include the National Medical Support Notice with the Order/Notice - Income Withholding for Support in an employer packet only when dependent insurance is ordered through an employer/union. The National Medical Support Notice may also be issued separately from the Order/Notice - Income Withholding for Support. Also, individual attorneys and parents have the legal right to serve employers. They cannot use the National Medical Support Notice but may use the Order/Notice - Income Withholding for Support.
Q4: What are an employer's obligations when receiving a National Medical Support Notice?The Notice has two parts - Part A, Notice to Withhold for Health Care Coverage (which includes an Employer Response) and Part B, Medical Support Notice to Plan Administrator (which includes a Plan Administrator Response). The employer must check the appropriate box on Part A (Employer Response) and return it to the issuing agency within 20 business days after the date of the notice (or sooner if reasonable) if the:
- Employee named in the notice is not an employee; or
- Employer does not maintain or contribute to a plan that provides dependent coverage; or
- Named employee is among a class of employees (e.g., part time or non-union) not eligible for enrollment in a plan that provides dependent coverage.
In all other cases, the employer must transfer Part B of the notice to the group health plan (or plans) for which the child may be eligible for enrollment. The employer must transfer Part B not later than 20 business days after the date of the notice. (For Part A and Part B purposes, the "date of the notice" means the date that is shown on the notice.)
If the employer offers different types of benefits (e.g., dental, prescription) through separate plans, and the issuing agency does not specify the type of coverage, the employer should assume that all plans are included and should forward copies of Part B to each plan administrator.
Application of a "waiting period" before an employee may enroll in the group health plan does not affect the employer's obligation to transfer Part B to the plan administrator(s).
When transferring Part B of the notice, the employer retains Part A. The employer may later need to use Part A if it is determined the employee has insufficient income to withhold the contribution required to enroll the child(ren) in the health care plan.
Q5: What are a plan administrator's obligations upon receipt of a National Medical Support Notice?The plan administrator must inform the state agency that issued the notice when coverage under the plan for the child named in the notice will begin. The plan administrator must also provide the child's custodial parent (or, in some cases, a named state official) with information about the child's coverage under the plan, such as the plan's summary description, any required forms or documents necessary for filing claims under the plan, etc.
If the employee is not enrolled and there is more than one option available under the plan for coverage of the child, the plan administrator must also use the Plan Administrator Response to notify the agency of that fact, and inform the agency of the available options for coverage. If the agency does not then respond within 20 business days and the plan has a "default option," the plan administrator may enroll the child in the default option.
Q6: What is an "appropriately completed" National Medical Support Notice (NMSN)?An "appropriately completed" notice is a notice that includes the following information:
- The name of an issuing state's child support enforcement agency
- The name and mailing address of the employee, who is enrolled or eligible for enrollment and who is obligated by a state court or administrative order to provide medical support for each named child
- The name and mailing address of each child covered by the NMSN (The name and address of a state or local official may be substituted for the child's name and address.)
Note: All Illinois-issued NMSNs are pre-printed, contain all necessary information and should be considered appropriately completed.
Q7: What if the non-custodial parent is not yet eligible to enroll because he or she has not satisfied the plan's generally applicable waiting period?For short waiting periods (90 days or less remaining at the time of the plan administrator's receipt of Part B), the plan administrator waits until the expiration of the necessary time to enroll the child and notifies the employer of the need, if any, to withhold from the employee's wages to provide such coverage.
For long waiting periods (greater than 90 days remaining at the time of the plan administrator's receipt of Part B, or the period is measured by other means, such as hours worked), the plan administrator should inform the employer of the waiting period. The employer sends Part A to the department and notifies the plan administrator when the employee becomes eligible.
Q8: What does an employer do if the income is insufficient to withhold for medical coverage?The employer must determine if necessary employee contributions may be withheld from the employee's wages without violating any applicable withholding limits. Part A of the National Medical Support Notice (NMSN) contains information for the employer regarding federal and state limitations on withholdings, any applicable withholding prioritization laws, and the duration of the withholding obligation. If withholding limits would prevent the employer from withholding the employee contributions necessary for coverage, the employer must use the Employer Response on Part A to notify the issuing IV-D agency of the employer's inability to withhold the necessary amounts. If the amounts necessary for coverage can be withheld, then the employer must initiate such withholding and transmit the withheld amounts to the group health plan to pay for the child's coverage. (For income withholding limitations, reference Income Withholding, Question 13.)
Q9: Who pays for coverage provided pursuant to a National Medical Support Notice (NMSN)?The NMSN provides that the employee named in the NMSN is liable for any employee contributions required under the plan for enrollment of the children. However, if federal or state withholding limitations prevent the withholding of the required employee contributions from the employee's paycheck, the plan is not required to provide coverage for the child. The employer is required to notify the state agency if such withholding limitations prevent the withholding of the required employee contributions.
Q10: Are all medical child support orders issued by a court?No. Either a court of competent jurisdiction or an administrative agency authorized to issue child support orders under state law (such as a state child support enforcement agency) can issue a medical support order.
Q11: Who can be an "alternate recipient"?Any person named under a medical child support order as having a right to enrollment under the plan with respect to the plan participant is an alternate recipient.
Q12: What should the employer do if the employee ordered to obtain dependent health insurance is not enrolled in the plan?If the plan requires that the participant be enrolled in order for the child(ren) to be enrolled, and the participant is not currently enrolled, the employer must enroll both the participant and the child(ren) regardless of whether the participant has applied for enrollment in the plan. All enrollments are to be made without regard to open season restrictions.
Q13: Can a medical child support order require the plan to provide coverage for a child of a participant if a group health plan does not provide any dependent coverage?No. The employer marks #2 of Part A and returns the form.
Q14: Is the plan required to create and provide comparable benefits to an alternate recipient who resides outside of the HMO's service area if a plan provides benefits solely through an HMO or other managed care organization with a geographically limited benefit area?No. A National Medical Support Notice (NMSN) cannot require a type or form of benefit that is not otherwise available under the plan. A plan that provides benefits solely through a limited-area HMO is not required to provide benefits to alternate recipients outside of the HMO's service area (i.e., on a fee-for-service or any other basis). On the other hand, if the dependent is able to come into the HMO's service area for medical care, the plan would be required to provide benefits.
Q15: Does the child have any rights to continuation coverage if a child is covered by a group health plan pursuant to the National Medical Support Notice (NMSN)?Yes. A child covered by a group health plan pursuant to an NMSN is a beneficiary under the plan. The Internal Revenue Service (which has jurisdiction over such questions) has informed the department that a child covered pursuant to an NMSN is therefore a "qualified beneficiary" with the right to elect continuation coverage under COBRA, if the plan is subject to COBRA and if the child loses coverage.
Q16: When must a plan begin to provide coverage pursuant to a National Medical Support Notice (NMSN)?Coverage must begin at the earliest possible date following receipt of the NMSN. For example, if an insured plan only adds new participants or beneficiaries as of the first day of each month, the plan would be required to provide coverage as of the first day of the first month following the receipt of the NMSN. Section 1908 of the Social Security Act requires that when a child is enrolled in a plan pursuant to a court or administrative order, that enrollment be made without regard to open-enrollment restrictions.
Q17: To whom should the plan pay benefits?The plan should pay benefits to the alternate recipient, the custodial parent, or the provider of health services to the child, notwithstanding plan terms that may require benefit payments be made to the participant. In some instances, the plan will be required to make payment to the state child support enforcement or Medicaid agency.
Q18: When and under what conditions may a plan disenroll an alternate recipient?A plan may disenroll an alternate recipient at the same time and under the same conditions as it can disenroll other dependents of participants under the plan. For instance, if the plan terminates coverage when a participant terminates employment, and neither the participant nor the alternate recipient elects COBRA continuation coverage, the plan may discontinue coverage for the alternate recipient. Similarly, if the plan ceases to provide coverage for dependents that are over the age of 18, the coverage of an alternate recipient who is over the age of 18 may be terminated (assuming that continuation coverage is not elected).
Q19: Must an "alternate recipient" be enrolled in the same coverage and options in which the participant is enrolled if a plan provides that dependents of participants must be enrolled in the same coverage and option as the participant?Yes.
Q1: When does the state of Illinois send out income withholding notices?Illinois initiates an Order/Notice - Income Withholding for Support to the employer within two (2) days of learning about a non-custodial parent's employment or whenever changes occur on an existing Order/Notice.
Q2: What does the employer receive?Illinois sends the employer The Order/Notice - Income Withholding for Support and the Employer IWN Cover Letter. The National Medical Support Notice, the HIPPA Privacy Letter and the Health Insurance Report are included if employer- or union-related health insurance is ordered. These forms provide a summary of all the information the employer needs to comply with income withholding and dependent medical insurance.
Q3: Does a notice to Withhold always come from the Illinois Department of Healthcare and Family Services?No. The law allows every state to send withholding notices to employers outside their state. The employer must follow the laws of the state sending the notice.
Q4: How does an employer know when and how much to withhold?Withholding must begin no later than the first pay period occurring within 14 business days after the date the notice was mailed, faxed or personally served on the employer. The notice informs the employer of the amount to be withheld. The withheld pay must be sent within seven (7) business days of the pay date of withholding. The address to which the withheld pay is to be sent is in the notice.
Q5: What if the employee's available allowable disposable income is less than the amount to be withheld?If the pay available for withholding under the federal Consumer Credit Protection Act cannot meet total child support payments, then the employer withholds amounts provided in the
Order/Noticeusing the following priority list:
- Current child support
- Health care coverage
- Delinquency payments
- Notice of Levy (wage garnishment)
Q6: What does an employer send with the check or money order for employees' withheld funds?The remittance should be made payable to the state Disbursement Unit and must include:
- Illinois county where the order was entered
- Case/docket number
- Name of each employee
- Social Security number of each employee
- Amount of the payment and pay date for each employee and each case number (if the employee has more than one case)
- Name and address of the payee, if known
Q7: Can the employer send withheld income from the pay of several different employees in one check?Yes. An employer may combine withheld amounts for more than one employee in a single payment; however, information (see A6 directly above) must be provided about the amount withheld for each employee listed.
Q8: Does an employer have to withhold at the frequency on the notice?Employers do not have to vary their pay cycles to comply with the ordered frequency. For the employer's convenience, the notice provides the total amount to be withheld and the corresponding amounts for weekly, biweekly, semimonthly and monthly pay cycles.
Q9: How does an employer know when to stop withholding?The employer receives an Order/Notice from the Illinois Department of Healthcare and Family Services or from the issuing agency indicating when withholding should stop.
Q10: Can an employer charge a fee to cover the cost of issuing a separate check?An employer can charge a fee of up to $5 per month to each employee where the employer is withholding income. The employer deducts this fee from the employee's remaining income, not the support payment.
Q11: What if the employee quits?When the employee's employment ends, the withholding should continue through the last pay date. When the employee leaves, the employer should return the Order/Notice to the issuing agency along with any information the employer might have about the employee's new employment and address. The Employer Response Page of Part A of the National Medical Support Notice should also be completed and returned to the issuing agency.
Q12: What are the priorities for wage garnishment?Support payments take priority over all others, except federal (IRS) tax levies served prior to the date of the child support order (the underlying order, not the Order/Notice - Income Withholding for Support). If the employee also has federal, state or local tax garnishments, the employer should seek confirmation of this withholding priority from the tax agency.
Q13: How does the federal Consumer Credit Protection Act affect withholding?The federal Consumer Credit Protection Act limits the available net income as follows:
- 50% if the non-custodial parent has other dependents and owes no arrearages or is less than 12 weeks in arrears
- 60% if the non-custodial parent has no additional dependents and owes no arrearage or is less than 12 weeks in arrears
- 55% if the non-custodial parent has other dependents and is over 12 weeks in arrears
- 65% if the non-custodial parent has no other dependents and is over 12 weeks in arrears
Q14: Can child support be withheld from bonuses, profit sharing, severance pay and commissions?Yes. This must be done if the periodic wage amount does not satisfy the ordered support amount or if the child support order states that an additional amount is to be taken from the additional income.
Q15: Are there shortcuts to make it easier for employers to comply?Illinois law requires that after June 30, 2000, every employer having 250 or more employees shall use electronic funds transfer (EFT) to pay all amounts withheld pursuant to a child support income withholding notice. (750 ILCS 28/35 (a)) Additionally, the statute requires that after January 1, 2001, every employer with fewer than 250 employees and where the employer withholds income for child support for 10 or more income withholding notices during the preceding December shall use EFT to pay all amounts withheld pursuant to a child support income withholding order. (750 ILCS 28/35 (a)) Employers should contact the Illinois state Disbursement Unit EFT liaison for instructions on how to properly submit child support payments by EFT. The EFT liaison contact number is 1-888-704-0683.
Q16: Can an employer discipline, discharge or refuse to hire an employee who has a withholding order?No. If an employer discharges, disciplines, refuses to hire or otherwise penalizes an employee because of a support obligation, the employer can be ordered to employ, reinstate and pay restitution to the employee. The employer may also be fined up to $200.
Q17: What does an employer do when the employee or custodial parent asks questions about his or her Order/Notice - Income Withholding for Support or National Medical Support Notice?Employers are not responsible for answering questions about the information on the notices. The employer should refer the employee or custodial parent to the inquiry number provided on the notices or to the customer service number listed on the Web site's Contact Information Page.
Q18: What if an employer does not comply with an Order/Notice - Income Withholding for Support?The employer may be subject to a $100 penalty for each day that the withheld amount is not paid after seven (7) business days have expired. If the employer willfully fails to withhold support pursuant to a notice, the employer can also be liable for the total amount not withheld.
Q19: Does the employer have to tell the employee that an Order/Notice - Income Withholding for Support has been received? What about the National Medical Support Notice?For an Illinois order, the department not only sends the employee a copy of the Order/Notice - Income Withholding for Support, but also includes a Non-Custodial Parent notice, which explains the withholding process and the employee's rights. If the employer receives the Order/Notice - Income Withholding for Support from another state, the employer must provide a copy to the employee.
For all Illinois orders and all orders registered in Illinois, the department sends the employee a cover letter regarding service of the National Medical Support Notice on their employer and a copy of the National Medical Support Notice. Because the NMSN the employer receives may contain the custodial parent's and child(ren)'s names and address(es), the employer should never share this document with the employee.
Q20: What should the employer do when the employee is ordered to provide medical support?When the non-custodial parent is ordered to provide dependent health insurance coverage through employment or the union, the employer or union receives a National Medical Support Notice. If employee/dependent medical coverage is provided by the employer, the employer must forward Part B of the notice to the plan administrator, who must immediately enroll (without regard to enrollment periods) the employee's child(ren) in the health plan designated in the order. The employer must withhold and pay the required premiums and other insurance fees on time. The employer/plan administrator must also mail to the custodial parent within 15 days of enrollment (or upon request) a notice of the effective date of coverage, information on the dependent coverage plan and the necessary forms to obtain reimbursement for covered services. The National Medical Support Notice contains the custodial parent's name and address. This information is confidential and is not to be shared with the employee. If the employer does not provide employee/dependent medical coverage, the employer completes Part A (Employer Response) of the National Medical Support Notice and returns it in the envelope provided or to the address listed on page one of the notice.
Q21: What does the employer do when an employee says the information on the Order/Notice - Income Withholding for Support is wrong?Employers are not responsible for answering questions about the information on the Order/Notice - Income Withholding for Support. When an employee questions the withholding, the employer should refer the employee to the information on Page 3 of the Non-Custodial Parent notice, which is included in the employer-withholding packet and is also sent to the non-custodial parent. Directions on how to contest an income withholding order are clearly explained in this notice.
Q22: How can an employee owe past-due support when the employer has sent every single payment on time since the employee started working?A non-custodial parent can owe past-due support prior to his or her employment with a new employer. Also, if the non-custodial parent does not personally pay the child support to the State Disbursement Unit during the time between the start date of the Order/Notice - Income Withholding for Support and the date the employer actually withholds from the paycheck, a delinquency may accrue.
Q23: With enhancements to HFS' income withholding process occurring in August 2008, will there be changes to the employer packet?Yes. Changes include:
- HFS 3598- Employer IWN Cover Letter, advises the employer that an HFS 3683, Income Withholding for Support form is enclosed and provides pertinent information concerning the Order/Notice, including the employee's name, the effective date and instructions for remitting payment.
- HFS 3599- Notice-Agency Services Cancelled, which will be sent when HFS services are cancelled. The notice informs the employer that although the Department is no longer enforcing the child support order, the NCP remains obligated to follow the terms of the order and child support payments are to continue to be sent to the SDU.
- When there is an order for withholding which takes place at a date in the future and there is also a current order, the employer may receive two orders/notices from the Department. With each order/notice the employer will receive a HFS 3598 Employer IWN Cover letter, which will specify the date on which the terms take effect. This may also occur when there is only one order, but it has some terms that take effect in the future.
- The employer may now receive an order/notice which requires only a one-time lump sum payment. The amount due will be indicated on the order/notice.