The Personal Responsibility and Work Opportunity Reconciliation Act of 1996
INCREASING FINANCIAL SUPPORT FOR OUR NATION'S CHILDREN
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA)
ALL EMPLOYERS TO REPORT ALL NEW HIRES
The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996 was signed into law on August 22, 1996. This legislation provides for a much strengthened Child Support Enforcement Program. The Child Support Program benefits children and families by locating noncustodial parents, establishing paternity when necessary, and establishing and enforcing child support orders.
One key provision of the PRWORA legislation of importance to employers is that all States have a program providing information about the newly hired. This new hire reporting program provides timely information so that child support can be more effectively enforced. Employers will be required to report certain information on their newly hired employees to a designated State agency.
States will match new hire reports against child support records to locate parents, establish an order, or enforce an existing order. State agencies operating Employment Security and Workers' Compensation Programs will also have access to the new-hire information to detect and prevent erroneous benefit payments.
THE MINIMUM FEDERAL STANDARDS ESTABLISHED IN THE PRWORA ARE:
All employers must report all new-hires.
The new hire report must contain the name, address and social security number of the employee; and the name, address and Federal Employer Identification Number of the employer. It is extremely important that these reports be both accurate and legible, to ensure successful matching and contact once a match is made.
New hires must be reported to the State within 20 days of the date of hire. If an employer reports electronically or by magnetic media, the employer must report by two monthly transmissions not less than 12 nor more than 16 days apart. States may establish more stringent reporting requirements.
If an employer has employees in more than one State and reports either magnetically or electronically, that employer may designate one State (in which he/she has employees) to which all new hires may be reported. The employer must identify to the federal government the State which has been selected for reporting. A procedure to accomplish such selection will be provided to you at a later date.
The new hire report shall be made on a W-4 form, or an equivalent form at the employer's option.
New hire reports may be transmitted by first-class mail, by magnetic media, or electronically.
STATES WHICH CURRENTLY HAVE NEW HIRE LEGISLATION
Nearly half of the States already have new hire reporting legislation. States already operating new hire programs must conform their requirements to the minimum Federal requirements no later than October 1, 1998. If you live in a State which currently has new hire reporting, your State will notify you about changes in your procedures, if any, and when those changes will go into effect.
States that already have New Hire Reporting Programs:
STATES WITHOUT NEW HIRE LEGISLATION BEFORE AUGUST 22, 1996
Those States not listed, as well as Guam, Puerto Rico, U.S. Virgin Islands and the District of Columbia, must have new hire programs in place no later than October 1, 1997. Again, your State will notify you regarding what your specific State requirements are and when they will go into effect.
The Federal Office of Child Support Enforcement (OCSE) estimates that over 30% of child support cases involve parents who do not live in the same State as their children. Under PRWORA, the designated state agency will be required to transmit the new hire reports which they receive from employers to the Federal OCSE for entry into a National Directory of New Hires. Federal employers will report their new hires directly to the National Directory. This directory will operate to provide timely locate information to the States regarding child support cases.
CENTRALIZED COLLECTION OF WITHHELD INCOME
The PRWORA legislation also requires that each State establish, by October 1, 1998, a State Disbursement Unit for the collection and distribution of all child support payments. Employers will be given one location within each State where all income withholding issued by a child support agency and all other orders issued after January 1, 1994, with certain exceptions, are to be sent.
With your help, millions of children have received the child support they need and deserve. The people responsible for operating the Child Support Enforcement Program thank you for the critical role you play in making this program successful. Almost two out of every three dollars collected by child support agencies come from income withholding. This amounted to over $6 billion in 1995. Without your help, effective child support enforcement is impossible, and millions of our nation's children would suffer the consequences. With an effective new hire reporting system, millions more children will benefit.
U.S. Department of Health and Human Services
Administration for Children and Families
Office of Child Support Enforcement