DWP Direct Earning Attachments - update for employers

02 June 2014

The Department for Work and Pensions (DWP) have published guidance for employers on the use of Direct Earning Attachments (DEA) to recover money owed by employees to the DWP.

DWP published the following item on 2 June 2014:

As an employer you may be asked to deduct benefit overpayments an employee owes the Department for Work and Pensions (DWP) from their pay. This is called a Direct Earnings Attachment (DEA).

DWP will write to you and ask you to operate the DEA scheme if any of your employees are affected. DEA only applies to a small proportion of people owing money to DWP.

You may also be asked to make deductions for Housing Benefit overpayments an employee owes their local authority. Please contact local authorities, not DWP, about these deductions.

DWP have successfully piloted DEAs and are now increasing the volume of cases from July 2014.

A payroll software specification has been issued directly to over 600 payroll software development companies. Automation of the system will enable employers to manage the increasing number of DEAs.

You don't have to operate a DEA if you have fewer than 10 employees.

Other government departments such as the Child Maintenance Service, The Courts and Local Authorities also recover monies owed through the employee's salary. It is critical that employers note where a request has come from so that the correct account details are used when making payments - this will avoid unnecessary further contact by DWP.

DWP's preferred method of payment is by BACS. It is important you use the correct payee reference when making a BACS payment. For example:

  • When you make a single BACS payment for an individual employee or a series of separate individual BACS payments (rather than one combined payment for multiple employees), the payee reference is the employee's National Insurance Number. In these cases DWP do not require you to send a payment schedule.
  • When you make a single BACS payment which combines DEA deductions for multiple employees, the payee reference is DEA. In this case DWP do require you to send a payment schedule.

Further information and guidance on DEAs is available to employers via GOV.UK