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All business owners and human resources professionals know that replacing staff can represent a major cost to business. Depending on the position of the employee being replaced and the size of the organization the total costs of employee replacement can be between 30% and 150% of their salary. It follows that a strategy to retain staff, especially good working and highly experiences staff, can be very important.

How does the Government fit into this?

The most recent Annual Report of Services Australia reveals that of the $3.744 billion in child support payments in the 2019-20 year, $1.698 billion was collected through Services Australia Child Support. Departmental policy dictates that the preferred collection method by the Department is by direct withholding from employees salaries. This is facilitated by notices issued to employers by the Department requiring that they withhold an amount specified in the notice from the employee’s salary and forward it directly to the Department. While this might seem reasonable at first glance there are several problems associated with it. 

• The process turns the employer into an unpaid money collector for the Department. The administrative costs depend on the number of affected staff and the costs of withholding the payments and forwarding the funds to the Department. Unless payments are being made individually, there is also a cost of itemising the payments by employee name and amount being forwarded.

• Child support assessments are due to be paid monthly in arrears on the 7th of the month. If the payments are received by the Department later than the 7th a robo-debt in the form of a late payment penalty is created. This is out of the control of both employers and employees.

• But whereas there are problems for both employers and employees with regular payments, the real problem is for staff where the withholding notices require payment of not only the regular assessments, but also of arrears (or child support debt). The powers in the Act are quite draconian with the self-support amount, that is the amount that the Agency is required by law to leave for the employees to cover all their weekly expenses, being currently only $378.53 per week.

Given the amount of money collected annually by Services Australia, It is very likely that most large employers have received notices from the Department  to make deductions from wages for ongoing child support and arrears.  This inevitably leaves many employees financially distressed. Many staff are also having to deal with Services Australia in a wider range of child support matters.  These dealings are stressful and frequently leave the employee in a state of heightened anxiety and severe financial hardship, not to mention the stresses and strains brought to bear on new relationships and families. Unsurprisingly, this anxiety and the financial hardship very often detracts from the productivity of the employee.

Loss of productivity based on an employee’s anxiety and financial hardship can be a significant cost to the employer. In a worst case, where the employee deliberately chooses unemployment, the employer is faced with the significant costs, inconvenience and loss of productivity involved in recruiting a replacement. In the very worst cases, there are suicide ideations and attempts, many of which are, unfortunately, successful. 

Engagement with Services Australia can very often be frustrating for those not familiar with the legislation and the attendant regulations. It can often result in  payment demands that are unfair, untenable and ultimately impossible to maintain. This frequently leads to employees resigning because the amount that is left after the child support deduction is insufficient to meet their living needs, mortgage and loan payments and often support for a new family.

What is not generally known - and rarely made known by the Department itself - is that the amount demanded through these notices is negotiable within a range. Child Support Help Australia offers a range of services whereby we act as representative for the employee and deal with Services Australia on their behalf. Where there are child support arrears our service includes negotiations with Services Australia for payment at the lowest end of the scale. 

Child Support Help Australia has the knowledge and the expertise to negotiate effectively on behalf of our clients. Often, we can negotiate a much fairer and more reasonable schedule of payments - one that alleviates mental and financial stress.

The debt for which the Agency is demanding payment is frequently in dispute. In this case the Agency will continue to take payments according the assessed amount while the dispute is being resolved. Child Support Help Australia assists our clients in fair and speedy resolution of these disputes.  

Benefits of Child Support Help Australia

For Employees:

• Acting as a buffer between parents and Services Australia creating peace of mind and reducing stress

• Ensuring that all relevant factors are being considered in child support assessments. This can legitimately save thousands of dollars in child support payments and penalties.

• Negotiation of payment arrangements with Services Australia regarding arrears and penalties.

• Negotiation of private agreements between parents for child support payments negating the need for involvement by Services Australia. This accords with the Objects of the Child Support (Assessment) Act “ to permit parents to make private arrangements for the financial support of their children”.

For Employers:

• Partnering with employers to help create a more stable work force thereby reducing staff replacement costs, recruiting and retraining.

• Working together with employers to assist employees with child support problems. This can have multiple benefits including staff contentment and creation of staff loyalty.

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IMPORTANT NOTE: We do not encourage nor do we facilitate the avoidance of child support payments. We simply ensure that these payments are fair taking all relevant factors into account.