Volume 6, Number 2, Summer-Fall 1997
In an effort to find parents who are delinquent in child support obligations, California lawmakers enacted legislation in 1992 requiring certain employers to report information on newly hired employees to the Employment Development Department. The law exempted agricultural employers, except those engaged in landscape and horticultural services (lawn and garden services, ornamental shrub and tree services), from the reporting requirements, although they may contribute hiring information voluntarily.
The nation's growing problem of nonpayment of child support (and the taxpayer burden joined to it) was addressed by Congress in the 1996 welfare reform legislation. Beginning July 1, 1998, all employers in California, including agricultural employers, will be required to report, within 20 days, the name, address, and social security number of every newly hired employee (along with their own employer name, address, and tax identifying numbers) to a state "new-hire directory." California's EDD has an information hotline: 916/654-8747.
In addition to facilitating collection of child support payments, the information will help states prevent fraudulent unemployment and workers' compensation claims.
Reports of new hires can be made on federal Form W-4 (or equivalent state form DE34), and employers may choose whether to transmit them by magnetic tape, electronically, or non-electronically by first class mail or fax (916/653-5214). Those reporting electronically or by magnetic tape are required to file twice a month, not less than 12 days and not more than 16 days apart. Non-electronic filers in California's current program are required to submit the employee-specific information within 30 days (only after they have a new hire), but that will drop back to within 20 days of hiring starting July 1, 1998, to be consistent with the federal program.
In cases where courts order wage withholding to meet child support obligations, employers will have 7 days to submit funds to a "state disbursement unit." Employers should review their accounting systems to ensure that any court-ordered payments generated by the new law can be made inside 7 days.