tete Office of Personnel Management

Retirement and Insurance Group

1920 1954 1959 

 

1986 

Benefits Administration Letter

Number: 95-206 Date: January 25, 1995

SUBJECT: Notifying FEHB Carriers They May Garnish Enrollees'

Wages

 

A. Legal Authority Section 9 of Public Law 103-94 (5 U.S.C.

to Garnish § 5520a) requires the Federal Government to

Employees' honor commercial garnishments. The Office of

Wages Personnel Management (OPM) issued

implementing regulations for most of the

Executive Branch in 5 CFR Part 582 (see

attached Federal Register excerpt dated March

29, 1994, 59 FR 14541).

 

B. Notification You are probably already aware of this

of FEHB garnishment authority and have probably

Carriers already received garnishment orders from

commercial firms. However, this authority

has not previously been used by the health

plans in the Federal Employees Health

Benefits (FEHB) Program. We have notified

FEHB plans that they may use this garnishment

authority to collect debts owed by employees

enrolled in their plans (see attached FEHBP

All Carrier Letter). These debts would

include the nonpayment of deductibles and

copayments and other instances in which the

enrollee owes money to the plan (such as

collection of a previous overpayment by the

plan). We wanted to let you know that FEHB

plans will be using this authority.

 
2

C. Effect of The attached regulations specify what portion

Garnishment of an employee's wages are subject to

on the garnishment. Deductions for FEHB premiums

Withholding of and Basic Life insurance premiums are

FEHB and protected from garnishment. However,

FEGLI premiums deductions for optional FEGLI insurance are

not protected from garnishment. Therefore,

it may be necessary on occasion to counsel

certain employees that their optional

insurance may be administratively terminated

if there is insufficient pay to deduct

premiums and this scenario is expected to

continue for six months or more.

 

2 Attachments
ATTACHMENT 1

Page: 59 FR 14541 No. 60 3/29/94

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 582

RIN 3206 - AF83

Commercial Garnishment of Federal Employees' Pay

AGENCY: Office of Personnel Management.

ACTION: Interim rule with request for comments.

SUMMARY: The Office of Personnel Management (OPM) is issuing

interim regulations to implement the commercial garnishment of

Federal employees' pay. This part provides procedures and

guidance for Executive Branch agencies of the Federal Government

to process commercial garnishment orders, including tax levies

from State and local governments.

DATES: Comments should be received by (30 days after the date of

publication).

ADDRESSES: Send or deliver comments to Lorraine Lewis, General

Counsel, Office of Personnel Management, Room 7355, 1900 E

Street, NW., Washington, DC 20415.

FOR FURTHER INFORMATION CONTACT: Murray M. Meeker, Attorney,

Office of the General Counsel, (202) 606-1920.

SUPPLEMENTARY INFORMATION: On October 6, 1993, Congress enacted

section 9 of Public Law 103-94 which waived the Federal

Government's sovereign immunity to permit compliance with

garnishment orders for commercial debts. On February 3, 1994,

the President signed Executive Order Number 12897 which delegated

responsibility to OPM to issue implementing regulations for most

of the Executive Branch. These regulations are in accordance

with this delegation of authority. OPM anticipates that in most

instances, agents previously designated to receive garnishment

orders based on obligations for child support and/or alimony will

be similarly designated to receive commercial garnishment orders. 

OPM requests that in addition to providing comments concerning

these proposed regulations, agencies advise OPM if they would

prefer to designate different agents to receive commercial

garnishment orders. Because the commercial garnishment

provisions in Public Law 103-94, section 9, became effective on

February 3, 1994, OPM believes that it is important to issue

these regulations as an interim rule with an immediate effective

date. OPM believes that the need for immediate implementing

regulations to facilitate the processing of and compliance with

commercial garnishment orders both justifies and necessitates
2

publication without a Notice of Proposed Rulemaking as would

ordinarily be provided pursuant to 5 U.S.C. 553(b)(A). For these

same reasons, OPM believes that a delayed effective date is not

required pursuant to 5 U.S.C. 553(d)(2). OPM will, however,

consider any public comments before issuing a final rule.

REGULATORY FLEXIBILITY ACT

I certify that these regulations will not have significant

economic impact on a substantial number of small entities because

their effects are limited to Federal employees and their

creditors.

E.O. 12866, REGULATORY REVIEW

This rule has been reviewed by the Office of Management and

Budget in accordance with E.O. 12866.

LIST OF SUBJECTS IN 5 CFR PART 582

Claims.

 U.S. OFFICE OF PERSONNEL MANAGEMENT

 

 Lorraine A. Green

 Deputy Director

Accordingly, OPM is establishing Part 582 of Title 5, Code of

Federal Regulations as follows:

PART 582--COMMERCIAL GARNISHMENT OF FEDERAL EMPLOYEES' PAY

Subpart A--Purpose, Definitions, and Exclusions

Sec.

582.101 Purpose.

582.102 Definitions.

582.103 Exclusions

Subpart B--Service of Legal Process

582.201 Agent to receive process.

582.202 Service of legal process.

582.203 Information minimally required to accompany legal process.

Subpart C--Compliance with Process

582.301 Suspension of payment.

582.302 Notification of employee-obligor.

582.303 Response to legal process or interrogatories.
3

582.304 Nonliability for disclosure.

582.305 Honoring legal process.

582.306 Lack of entitlement by the employee-obligor to pay from

the agency served with legal process.

Subpart D--Consumer Credit Protection Act Restrictions

582.401 Aggregate disposable earnings.

582.402 Maximum garnishment limitations.

Subpart E--Implementation by Agencies

582.501 Rules, regulations, and directives by agencies.

Authority: 5 U.S.C. 5520a; 15 U.S.C. 1673; E.O. 12897

Appendix A to Part 582--List of Agents Designated to Accept Legal

Process

Subpart A--Purpose, Definitions, and Exclusions

Sec. 582.101 Purpose.

Section 5520a of title 5 of the United States Code provides

that with certain exceptions set forth in this part, pay from an

agency to an employee is subject to legal process in the same

manner and to the same extent as if the agency were a private

person. The purpose of this part is to implement the objectives

of section 5520a as they pertain to each executive agency of the

United States Government, except with regard to employees of the

United States Postal Service, the Postal Rate Commission, and the

General Accounting Office.

Sec. 582.102 Definitions.

(a) In this part--

(1) Agency means each agency of the executive branch of the

Federal Government, excluding the United States Postal Service,

the Postal Rate Commission, and the General Accounting Office;

agency does not include the government of the District of

Columbia or the territories and possessions of the United States.

(2) Employee or employee-obligor means an individual who is

employed by an agency as defined in this section; except for

reemployed annuitants and retired members of the uniformed

services who are employed by an agency, employee does not include

a retired employee, member of the uniformed services, or a

retired member of the uniformed services.

(3) Legal process means any writ, order, summons, or other

similar process in the nature of garnishment, which may include

an attachment, writ of execution, court ordered wage assignment,

or tax levy from a State or local government, which--

(i) Is issued by: 

(A) A court of competent jurisdiction, including Indian
4

tribal courts, within any State, territory, or possession of the

United States, or the District of Columbia. As stated in section

582.101, pay is subject to legal process in the same manner and

to the same extent as if the agency were a private person. There

is, therefore, no requirement in this part that, for example,

legal process be signed by a judge; or

(B) An authorized official pursuant to an order of a court

of competent jurisdiction or pursuant to State or local law; or

(C) A State agency authorized to issue income withholding

notices pursuant to State or local law; and

(ii) Orders an agency to withhold an amount from the pay of

an employee-obligor and to make a payment of such withholding to

a person, for a specifically described satisfaction of a legal

debt of the employee-obligor, or recovery of attorney fees,

interest, or court costs;

(4) Person may include an individual, partnership, corporation, association, joint venture, or private organization, and

includes the plural of that term; person may include a State or

local Government as well as a foreign entity or a foreign

governmental unit.

(5) In conformance with 5 U.S.C. 5520a, pay means basic pay;

premium pay paid under chapter 55, subchapter V, of title 5 of

the United States Code; any payment received under chapter 55,

subchapters VI, VII, or VIII, of title 5 of the United States

Code; severance pay and back pay under chapter 55, subchapter IX,

of title 5 of the United States Code; sick pay, and any other

paid leave; incentive pay; locality pay (including interim

geographic adjustments, special pay adjustments for law

enforcement officers, and locality-based comparability payments);

and any other compensation paid or payable for personal services,

whether such compensation is denominated as pay, wages, salary,

lump-sum leave payments, commission, bonus, award, or otherwise;

but does not include awards for making suggestions, reimbursement

for expenses incurred by an individual in connection with

employment, or allowances in lieu thereof.

Sec. 582.103 Exclusions.

In determining the amount of pay subject to garnishment

under this part, there shall be excluded amounts which:

(a) Are owed by the employee-obligor to the United States;

(b) Are required by law to be deducted from the employeeobligor's pay, including, but not limited to:

(1) Amounts withheld from benefits payable under title II of

the Social Security Act;

(2) Federal employment taxes; and

(3) Amounts deducted for Medicare; 

(c) Are properly withheld for Federal, State, or local

income tax purposes, if the withholding of the amounts is authorized or required by law and if amounts withheld are not greater

than would be the case if the employee-obligor claimed all

dependents to which the employee-obligor were entitled. The
5

withholding of additional amounts pursuant to section 3402(i) of

title 26 of the United States Code may be permitted only when the

employee-obligor presents evidence of a tax obligation which

supports the additional withholding; 

(d) Are deducted as health insurance premiums; 

(e) Are deducted as normal retirement contributions, not

including amounts deducted for supplementary coverage. For

purposes of this section, all amounts contributed under sections

8351 and 8432(a) of title 5 of the United States Code to the

Thrift Savings Fund are deemed to be normal retirement contributions. Except as provided in this paragraph, amounts voluntarily

contributed toward additional retirement benefits are considered

to be supplementary; or

(f) Are deducted as normal life insurance premiums from

salary or other remuneration for employment, not including

amounts deducted for supplementary coverage. Federal Employees'

Group Life Insurance premiums for "Basic Life" coverage are

considered to be normal life insurance premiums; all optional

Federal Employees' Group Life Insurance premiums and any life

insurance premiums paid for by allotment are considered to be

supplementary.

Subpart B--Service of Legal Process

Sec. 582.201 Agent to receive process.

(a) Except as provided in appendix A to this part, appendix

A to 5 C.F.R. Part 581 lists agents designated to accept service

of process under Part 581 and this part.

(b) United States Attorneys are not considered appropriate

agents to accept service of process.

Sec. 582.202 Service of legal process.

(a) A party using this part shall serve legal process on the

agent to receive process as explained in section 582.201.

Where the legal process is directed to an agency, and the purpose

of the legal process is to compel an agency to garnish an

employee's pay, the legal process need not expressly name the

agency as a garnishee.

(b) Service of legal process may be accomplished by certified or registered mail, return receipt requested, or by personal

service upon the agent to receive process as explained in section

582.201, or if no agent has been designated, then upon the head

of the employee-obligor's employing agency. The designated agent

shall note the date and time of receipt on the legal process.

(c) Parties bringing garnishment actions shall comply with

the service of process provisions in this section. Service will

not be effective where parties fail to comply with the service of

process provisions of this section, notwithstanding whether the

party bringing the garnishment action has complied with the

service of process requirements of the jurisdiction issuing the

legal process.
6

Sec. 582.203 Information minimally required to accompany legal

process.

(a) Sufficient identifying information must accompany the

legal process in order to enable processing by the agency. 

Parties seeking garnishment actions are, therefore, asked to

provide the following identifying information concerning the

employee-obligor: 

(1) Full name; 

(2) Date of birth; 

(3) Employment number or social security number;

(4) Component of the agency for which the employee-obligor

works;

(5) the official duty station or worksite; and

(6) home address.

(b) If the information submitted is not sufficient to

identify the employee-obligor, the legal process shall be

returned directly to the court, or other authority, with an

explanation of the deficiency. However, prior to returning the

legal process, if there is sufficient time prior to the time

limits imposed in section 582.303, an attempt should be made to

inform the party who caused the legal process to be served, or

the party's representative, that it will not be honored unless

adequate identifying information is supplied.

Subpart C--Compliance With Legal Process

Sec. 582.301 Suspension of payment.

Upon proper service of legal process as specified in

sections 582.202 and 582.203, the agency shall suspend, i.e.,

withhold, payment of such moneys for the amount necessary to

permit compliance with the legal process in accordance with this

part.

Sec. 582.302 Notification of employee-obligor.

(a) As soon as possible, but not later than 15 calendar days

after the date of valid service of legal process, the agent

designated to accept legal process shall send to the employeeobligor, at his or her duty station or last known home address,

written notice that such process has been served, including a

copy of the legal process;

(b) The agency may provide the employee-obligor with the

following additional information: 

(1) Copies of any other documents submitted in support of or

in addition to the legal process; 

(2) Notice: That the United States does not represent the

interests of the employee-obligor in the pending legal

proceedings; and

(3) Advice: That the employee-obligor may wish to consult

legal counsel regarding defenses to the legal process that he or

she may wish to assert.
7

Sec. 582.303 Response to legal process or interrogatories.

(a) Whenever the designated agent is effectively served with

legal process, the agent shall respond within 30 calendar days,

or within such longer period as may be prescribed by applicable

State or local law, after the date valid service is made. The

agent shall also respond within this time period to interrogatories which accompany legal process.

(b) If State or local law authorizes the issuance of interrogatories prior to or after the issuance of legal process, the

agent shall respond to the interrogatories within 30 calendar

days, or within such longer period as may be prescribed by

applicable State or local law, after receipt.

Sec. 582.304 Nonliability for disclosure.

(a) No agency employee whose duties include responding to

interrogatories pursuant to section 582.303(b), shall be subject

to any disciplinary action or civil or criminal liability or

penalty for any disclosure of information made in connection with

the carrying out of any duties pertaining directly or indirectly

to answering such interrogatories.

(b) However, an agency would not be precluded from taking

disciplinary action against an employee who consistently or

purposely failed to provide correct information requested by

interrogatories.

Sec. 582.305 Honoring legal process.

(a) The agency shall comply with legal process, except where

the process cannot be complied with because:

(1) It is not regular on its face.

(2) The legal process would require the withholding of funds

not deemed pay as described in section 582.102(a)(5).

(3) It does not comply with section 5520a of title 5 of the

United States Code or with the mandatory provisions of this part;

or

(4) An order of a court of competent jurisdiction enjoining

or suspending the operation of the legal process has been served

on the agency.

(b) While an agency will not comply with legal process

which, on its face, indicates that it has expired or is otherwise

no longer valid, legal process will be deemed valid notwithstanding the fact that the underlying debt and/or the underlying

judgment arose prior to the effective date of section 5520a of

title 5 of the United States Code.

(c) While the filing of an appeal by an employee-obligor

will not generally delay the processing of a garnishment action,

if the employee-obligor establishes that the law of the

jurisdiction which issued the legal process provides that the

processing of the garnishment action will be suspended during an

appeal and if the employee-obligor establishes that he or she has

filed an appeal, the employing agency shall comply with the

applicable law of the jurisdiction and delay or suspend the
8

processing of the garnishment action.

(d) Under the circumstances set forth in section 582.305(a)

or (b), or where the agency is directed by the Justice Department

not to comply with the legal process, the agency shall respond

directly to the court, or other authority, setting forth its

reasons for non-compliance with the legal process. In addition,

the agency shall inform the party who caused the legal process to

be served, or the party's representative, that the legal process

will not be honored. Thereafter, if litigation is initiated or

appears imminent, the agency shall immediately refer the matter

to the United States Attorney for the district from which the

legal process issued. To ensure uniformity in the executive

branch, agencies which have statutory authority to represent

themselves in court shall coordinate their representation with

the United States Attorney.

(e) In the event that an agency is served with more than one

legal process or garnishment order with respect to the same

payments due or payable to the same employee, the agency shall

satisfy such processes in priority based on the time of service: 

Provided, That in no event will the total amount garnished for

any pay or disbursement cycle exceed the applicable limitation

set forth in section 582.402. Provided further, That processes

which are not limited in time shall preserve their priority based

on time of service until fully discharged.

(f) Legal process to which an agency is subject under

sections 459, 461, and 462 of the Social Security Act (42 U.S.C.

659, 661, and 662) for the enforcement of the employee's legal

obligation to provide child support or make alimony payments,

shall have priority over any legal process to which an agency is

subject under this section.

(g) Neither the United States, any disbursing officer, nor

any executive agency shall be liable for any payment made from

moneys due from, or payable by, the United States to any individual pursuant to legal process regular on its face, if such

payment is made in accordance with this part. Where an agency

initially determines that legal process should not be honored, if

it subsequently determines that its initial determination was

erroneous, it may correct its initial determination and honor the

legal process. If an agency corrects an error or is required to

do so by a court or other authority, under no circumstances will

the agency be required to pay more than if it had originally

honored the legal process.

(h) Agencies affected by legal process served under this

part shall not be required to vary their normal pay or disbursement cycles to comply with the legal process. However, legal

process, valid at the time of service, which is received too late

to be honored during the disbursement cycle in which it is

received, shall be honored, to the extent that the legal process

may be satisfied, during the next disbursement cycle within the

limits set forth in section 582.402. The fact that the legal

process may have expired during this period would not relieve the
9

agency of its obligation to honor legal process which was valid

at the time of service. If, in the next disbursement cycle, no

further payment will be due from the agency to the employeeobligor, the agency shall follow the procedures set forth in

section 582.306.

(i) Agencies need not establish escrow accounts in order to

comply with legal process. Therefore, even if the amount

garnished by an agency in one disbursement cycle is not sufficient to satisfy the entire indebtedness, the agency need not

retain those funds until the amount retained would satisfy the

entire indebtedness. On the contrary, agencies will, in most

instances, remit the garnished amount after each disbursement

cycle. Agencies need not pro-rate payments for less than a full

disbursement cycle.

(j) If an agency receives legal process which is regular on

its face, the agency shall not be required to ascertain whether

the authority which issued the legal process had obtained personal jurisdiction over the employee-obligor.

(k) At the discretion of the executive agency, the agency's

administrative costs in executing a garnishment may be added to

the garnishment amount and the agency may retain costs recovered

as offsetting collections. An administrative fee may be assessed

for each legal process that is received and processed by an

agency.

(l) Where an employee-obligor establishes that he or she has

filed a bankruptcy petition under section 301, 302, or 303 of

title 11 of the United States Code, the agency would be required

to comply with the automatic stay provision of the Revised

Bankruptcy Act, section 362(a) of title 11 of the United States

Code, and cease any garnishment action affecting the employeeobligor petitioner.

Sec. 582.306 Lack of entitlement by the employee-obligor to pay

from the agency served with legal process.

(a) When legal process is served on an agency and the

individual identified in the legal process as the employeeobligor is found not to be entitled to pay from the agency, the

agency shall follow the procedures set forth in the legal process

for that contingency or, if no procedures are set forth therein,

the agency shall return the legal process to the court, or other

authority from which it was issued, and advise the court, or

other authority, that the identified employee-obligor is not

entitled to any pay from the agency.

(b) Where it appears that the employee-obligor is only

temporarily not entitled to pay from the agency, the court, or

other authority, shall be fully advised as to why, and for how

long, the employee-obligor's pay will not be garnished, if that

information is known by the agency and if disclosure of that

information would not be prohibited.

(c) In instances where an employee-obligor separates from

employment with an agency that had been honoring a continuing
10

legal process, the agency shall inform the party who caused the

legal process to be served, or the party's representative, and

the issuing court, or other authority, that the garnishment

action is being discontinued. In cases where the employeeobligor has been employed by either another agency or by a

private employer, and where this information is known by the

agency, the agency shall provide the party with the designated

agent for the new employing agency or with the name and address

of the private employer.

Subpart D--Consumer Credit Protection Act Restrictions

Sec. 582.401 Aggregate disposable earnings.

In accordance with the Consumer Credit Protection Act, the

aggregate disposable earnings under this part are the employeeobligor's pay less those amounts excluded in accordance with

section 582.103.

Sec. 582.402 Maximum garnishment limitations.

Pursuant to section 1673(a)(1) of title 15 of the United

States Code (the Consumer Credit Protection Act, as amended) and

the Department of Labor regulations at title 29, Code of Federal

Regulations, part 870, the following limitations are applicable:

(a) Unless a lower maximum limitation is provided by

applicable State or local law, the maximum part of an employeeobligor's aggregate disposable earnings subject to garnishment to

enforce any legal debt other than an order for child support or

alimony, shall not exceed 25 percent of the employee-obligor's

aggregate disposable earnings for any workweek. Furthermore, the

following dollar limitations, which are contained in title 29 of

the Code of Federal Regulations, part 870, must be applied in

determining the garnishable amount of the employee's aggregate

disposable earnings:

(1) If the employee-obligor's aggregate disposable earnings

for the workweek are in excess of 40 times the Fair Labor

Standards Act (FLSA) minimum hourly wage, 25% of the employeeobligor's aggregate disposable earnings may be garnished. For

example, when the FLSA minimum wage rate is $4.25 per hour, this

rate multiplied by 40 equals $170.00 and thus, if an employeeobligor's disposable earnings are in excess of $170.00 for a

workweek, 25% of the employee-obligor's disposable earnings are

subject to garnishment.

(2) If the employee-obligor's aggregate disposable earnings

for a workweek are less than 40 times the FLSA minimum hourly

wage, garnishment may not exceed the amount by which the

employee-obligor's aggregate disposable earnings exceed 30 times

the current minimum wage rate. For example, at an FLSA minimum

wage rate of $4.25 per hour, the amount of aggregate disposable

earnings which may not be garnished is $127.50 [$4.25 x 30]. 

Only the amount above $127.50 is garnishable.

(3) If the employee-obligor's aggregate disposable earnings
11

in a workweek are equal to or less than 30 times the FLSA minimum

hourly wage, the employee-obligor's earnings may not be garnished

in any amount.

(b) There is no limit on the percentage of an employeeobligor's aggregate disposable earnings that may be garnished for

a State or local tax obligation or for bankruptcy purposes.

Subpart E--Implementation by Agencies

Sec. 582.501 Rules, regulations, and directives by agencies.

Appropriate officials of all agencies shall, to the extent

necessary, issue implementing rules, regulations, and/or directives that are consistent with this part.

Appendix A to Part 582--List of Agents Designated to Accept Legal

Process

[The agents designated to accept legal process are listed in

appendix A to part 581. Appendix A to part 582 provides listings

only for those executive agencies where the designations differ

from those found in appendix A to part 581.]

I. DEPARTMENTS

DEPARTMENT OF DEFENSE

Defense Finance and Accounting Service

Cleveland Center

Office of General Counsel

Attention: Code L

P.O. Box 998002

Cleveland, OH 44199-8002

(216) 522-5301

Agents for receipt of all legal process for all Department of

Defense civilian employees except where another agent has been

designated as set forth below.

For requests that apply to employees of the Army and Air

Force Exchange Service or to civilian employees of the Defense

Contract Audit Agency (DCAA) and the Defense Logistics Agency

(DLA) who are employed outside the United States: See appendix A

to part 581.

For requests that apply to civilian employees of the Army

Corps of Engineers, the National Security Agency, the Defense 

Intelligence Agency, and non-appropriated fund civilian employees

of the Air Force, serve the following offices:

ARMY CORPS OF ENGINEERS:

U.S. Army Corps of Engineers, Omaha District

Central Payroll Office

Attn: Garnishments

P.O. Box 1439 DTS
12

Omaha, NE 68101-1439

NATIONAL SECURITY AGENCY:

General Counsel

National Security Agency / Central Security Service

9800 Savage Rd.

Ft. G. Mead, MD 20755-6000

DEFENSE INTELLIGENCE AGENCY:

Office of General Counsel

Defense Intelligence Agency

Pentagon, 2E238

Washington, DC 20340-1029

AIR FORCE NON-APPROPRIATED FUND EMPLOYEES:

Office of General Counsel

Air Force Services Agency

10100 Reunion Place

Suite 503

San Antonio, TX 78216-4138

For civilian employees of the Army, Navy and Marine Corps who are

employed outside the United States, serve the following offices:

ARMY CIVILIAN EMPLOYEES EUROPE:

266th Theater Finance Command

ATTN: AEUCF-CPF

APO New York 09007-0137

ARMY CIVILIAN EMPLOYEES IN JAPAN:

US Army F&AO Japan

Unit 45005

Camp Zama

APO AP 96343-0087

ARMY CIVILIAN EMPLOYEES IN KOREA:

Commander

175th TFC (Korea)

APO AP 96301-007361

ARMY CIVILIAN EMPLOYEES IN PANAMA:

DCSRM Finance & Accounting Office

Unit 7153

ATTN: SORM-FAP-C

APO AA 34004-5000

NAVY AND MARINE CORPS CIVILIAN EMPLOYEES OVERSEAS:

Director of the Office of Civilian Personnel Management

Office of the General Counsel

Navy Department

800 N. Quincy St.
13

Arlington, VA 22203-1998
ATTACHMENT 2

FEHBP Letter

All Carriers

U.S. Office of Personnel Management

 Office of Insurance Programs

FEHBP Letter No. 94-24 Date December 16, 1994

SUBJECT: Garnishment of Enrollees' Wages

Section 9 of Public Law 103-94 (5 U.S.C. §5520a) requires the

Federal Government to honor commercial garnishments. The Office

of Personnel Management (OPM) issued implementing regulations for

most of the Executive Branch in 5 CFR Part 582 (see Federal

Register excerpt dated March 29, 1994, and Appendix A of 5 CFR

Part 581, attached).

This means that FEHBP carriers may now request the garnishment of

employees' salaries in order to collect debts. The ability to

request garnishment of salaries to collect debts does not,

however, relieve carriers of their reporting responsibilities

under FEHBP Letter No. 94-02, Notifying OPM's Office of Inspector

General Concerning Fraud and Abuse Cases in the FEHB Program.

The carrier must obtain a garnishment order from a competent

authority. This is generally a court, but in certain states the

orders may be issued by an officer of the court, i.e., an

attorney. The carrier should then present the garnishment order

to the employing agency's designated agent. The agency is then

required to garnish the employee's salary and submit such monies

to the party named in the garnishment order (e.g., the FEHB

carrier). 

Please note that the law does not apply to retirees or Federal

annuities. Federal annuities cannot be garnished for commercial

debts. Also, even though the law applies to all civilian

employees in the Federal Government, OPM's regulations apply only

to agencies in the Executive Branch and do not cover the United

States Postal Service or the Postal Rate Commission.

We encourage all FEHBP carriers to take advantage of this

opportunity to recover debts. 

Sincerely,

Lucretia F. Myers

Assistant Director
 for Insurance Programs

Attachment