Handling Employer's Commission on Emoluments Attachment Orders Correctly!
If a Creditor gets an Emoluments Attachment Order awarded by the court, the employer is required to deduct a certain amount off the Debtor’s salary every month and pay it over to the Attorney. The Employer is allowed to charge an admin fee (5%) for doing this. For example, if the Debtor has R1000 deducted off his salary, the Employer takes R50 and pays over R950 to the attorney who then credits the Client with R950.
The “grey area” revolves around the R50. Our program, and all the others I presume, simply ignored this amount. It should actually be reflected in the Debtor’s account as a payment (even though the attorney didn’t receive it). So the net effect is that the Client is credited with R950, but the Debtor’s balance is reduced by the full R1000 – because that is in fact how much he paid. Read the full whitepaper to see how LegalSuite now handles this.
Attorneys who do not reflect this in the Debtors Account are therefore short-changing the debtor and this has become an issue with the Law Society who are examining many large debt collection practices for these (and other) irregularities. Read more about that here.
First published on the LegalSuite site.