Setup Considerations: Income Withholding Orders (CAN)
You can use this topic to help make decisions when planning your configuration and use of Canadian income withholding orders (also known as garnishments). It explains:
- Why to set it up.
- How it fits into the rest of Workday.
- Downstream impacts and cross-product interactions.
- Security requirements and business process configurations.
- Questions and limitations to consider before implementation.
Refer to detailed task instructions for full configuration details.
What It Is
Workday enables you to process these types of income withholding orders using rules that follow provincial and federal legislation:
- Family maintenance.
- Federal tax levies and provincial tax levies.
- Garnishments.
- Wage assignment.
Business Benefits
Workday makes it easy to comply with withholding order requirements by:
- Determining the amount to withhold from the employee’s disposable earnings, including arrears and any agency and employer fees.
- Applying withholding limits and setting priorities for what to withhold.
- Updating the withholding order calculation rules in accordance with federal and provincial changes. Example: The yearly update Quebec makes to their withholding rules.
- Providing visibility into the calculation rules that Workday uses to calculate withholding orders, by tax authority and withholding order type.
- Providing Workday-delivered statutory pay components for each withholding type.
- Dynamically displaying the required fields for each type of withholding order you record.
- Beginning automatic deductions during payroll processing once you record the withholding order.
- Calculating multiple withholding orders based on the rules for that order type and province.
- Aggregating withholding order amounts to avoid exceeding limits for a type of withholding order.
You can also attach a document to the income withholding order in Workday, such as the issued order. The attachment eliminates the need for paper and provides the flexibility for multiple payroll administrators to view the issued order.
Use Cases
- Payroll administrators can view active and inactive withholding orders directly from the worker's profile.
- For employees that have multiple withholding orders and the amount to withhold exceeds the maximum withholding limit, Workday uses statutory rules to calculate what to withhold for each order.
- Workday enables you to override withholding order priority when a worker has multiple withholding orders. The override enables you to change the order in which they’re processed.
Questions to Consider
Questions | Considerations |
|---|---|
Does the worker have past due amounts? | When recording a family maintenance order for a worker, you can enter the past due amount. In the order details, record the current child or spouse support and the past due child or spousal support amounts. Workday calculates the max amount that's available to withhold, and limits the deduction to that amount. |
For workers with multiple withholding orders, which one is of higher priority? | When a worker has multiple income withholding orders (IWOs), Workday assigns a processing priority to each order. The priority is based on the rules of the issuing agencies. You can override this priority from the related actions of the withholding order as needed. |
Recommendations
If necessary, ensure that withholding orders are valid by contacting the issuing court or agency.
Notify the worker of the order, and ensure they understand how it will affect their net pay.
Requirements
Load active withholding orders for the employees into Workday.
Limitations
Workers can't view their withholding orders in Workday.
You can't delete withholding orders Workday has calculated as part of a payroll, even if the payroll calculation isn't complete yet. You can inactivate the order instead.
Workday doesn't support income withholding orders for workers in international assignments.
Tenant Setup
(Optional) Define IDs for deduction recipients that Workday will use during processing and with integrations on the
Edit Tenant Setup - Financials
task. Security
Domains | |
|---|---|
Worker Data: Payroll (Income Withholding Orders) in the Core Payroll functional area. | Enables you to record information for a third-party deduction recipient in Workday, and view orders by worker. |
Set Up: Payroll (Calculations - Payroll Specific) in the Core Payroll functional area. | Enables you to set up pay component groups to calculate disposable income. |
Worker Data: Payroll (Income Withholding Orders) - CAN in the CAN Payroll functional area. | Enables you to record and view Canadian income withholding orders. |
Worker Data: Payroll (Income Withholding Orders) in the Core Payroll functional area. | Enables you to override withholding order priority for workers that have multiple IWOs. |
Reports: Pay Calculation Results for Pay Group (Results) - CAN in the CAN Payroll functional area. | Enables you to review payroll results, where you can audit withholding order results. |
Set Up: Payroll (Income Withholding Orders) in the Core Payroll functional area. | Enables you to view payroll withholding order data and allocation. |
Business Processes
No impact.
Reporting
Reports | Considerations |
|---|---|
All Payroll Withholding Order Data
| Displays the calculation rules of Workday for calculating withholding orders, by tax authority and order type. Includes information on:
|
View Payroll Withholding Order Data
| Displays an overview of the withholding order information that Workday maintains, such as:
|
Withholding Orders for Worker
| Enables you to edit, delete, change the processing priority, and view deduction history of a withholding order. |
Pay Calculation Results - Deduction Register
| View withholding order deductions in one or more periods, pay run groups, or pay groups. |
You can create custom reports from these report data sources:
- All Payroll Withholding Order Tax Authority Rules
- All Withholding Orders
Integrations
You can use these web services when creating a custom integration for garnishment processing to or from a third-party application:
- Put Payroll Deduction Recipientloads deduction recipient information into Workday.
- Get Payroll Deduction Recipientsretrieves information from Workday.
These web services enable you to enter Canada withholding orders into Workday, and retrieve them from Workday:
- Put Canada Income Withholding Order
- Get Canada Income Withholding Orders
Connections and Touchpoints
Create and set up bank accounts to pay third-party deduction recipients.
Record a
Business Number
tax ID for the worker's company.Workday offers a Touchpoints Kit with resources to help you understand configuration relationships in your tenant. Learn more about the Workday Touchpoints Kit on Workday Community.
Other Impacts
No impact.