Direct earnings attachment and earnings arrestments
Other forms of arrestment, such as an earnings arrestment, are considered a higher priority than a DEA.1Reg 29 SS(OR) Regs If other arrestments are applied, the DEA gives way to them. If a priority arrestment leaves the client with less than 60 per cent of their earnings, the DEA should not be applied.2Reg 29 SS(OR) Regs Student loans being deducted from the client’s earnings also take priority. If a DEA deduction can be taken, it must not leave the client with less than 60 per cent of their net earnings. If the full DEA deduction after other arrestments reduces net earnings to less than 60 per cent, a partial deduction can be made up to the protected earnings level.
Example: standard rate deduction
Client is paid monthly and has a wages arrestment already active; a DEA is received by their employer.
Net pay | £3,600 monthly (60% = £2,160) |
|---|
Wage arrestment (£600.25 plus 50% of earnings exceeding £3,563.83) | £618.33 |
Net pay after wages arrestment | £2,981.67 |
DEA deduction at standard rate (20%) | £720 |
Wages arrestment and DEA total | £1,338.33 |
Leaves client with | £2,261.67 |
The DEA can be fully implemented as it leaves the client with more than 60 per cent of their net wage.
Example: higher rate deduction
Net pay | £3,600 monthly (60% = £2,160) |
|---|
Wage arrestment (£600.25 plus 50% of earnings exceeding £3,563.83) | £618.33 |
Net pay after wages arrestment | £2,981.67 |
DEA deduction at higher rate (40%) | £1,440 |
Wages arrestment and DEA total | £2,058.33 |
Leaves client with | £1,541.67 |
DEA deduction would be reduced to | £821.67 |
Leaving client with | £2,160 |
As the 40 per cent deduction brings the client’s net pay below 60 per cent, it cannot be fully implemented. However, it can be partially implemented up to the threshold level.
This would also apply if the client had a DEA in place before a wages arrestment was actioned, DEA will always defer to arrestment.