Debt Collection in the Workplace

In today’s economy, many people have fallen behind on payments. Employers are not obligated to put telephone calls through or allow bill collectors on their property to contact employees. These calls would fall under any policy you may have about personal calls and/or visits. Employees should inform the bill collectors that they do not want to be contacted at work.

In Michigan, a debt collector is prohibited from “Communicating information relating to a debtor's indebtedness to an employer or an employer's agent unless the communication is specifically authorized in writing by the debtor subsequent to the forwarding of the claim for collection, the communication is in response to an inquiry initiated by the debtor's employer or the employer's agent, or the communication is for the purpose of acquiring location information about the debtor.” Act 70 of 1981 regulates collection practices in Michigan and section 445.252 lists what is prohibited. More can be found at www.legislature.michigan.gov.

A debt collector can contact an employer to verify employment. If a judgment has been obtained against an employee, then the order for garnishment of wages will be delivered to the employer. As an employer, you are legally obligated to follow the order for garnishment, so read all of the instructions carefully.

401(k) Fees

Caterpillar Inc. has reached a tentative settlement to pay $16.5 million in a case involving a dispute with employees and retirees regarding excessive 401(k) fees. With the current economy, investments are being looked at in a new light. Although Caterpillar maintains that it complies with ERISA, this litigation has been going on since September 2006. Can you imagine the legal fees? Do you know what the fee structure is for your 401(k) plan? Whether a participant or a provider, I think it is important for you to understand all the details!

For some basic, easy to understand information about 401(k) fees, check out: http://www.dol.gov/ebsa/publications/undrstndgrtrmnt.html