Child Support Issues in NC Workers’ Comp Claims
NC WORKERS’ COMPENSATION AND CHILD SUPPORT
Child support is one of the tricky, hidden issues in a North Carolina workers’ compensation claim. Under North Carolina law, “no claim for compensation under (the Workers’ Compensation Act) shall be assignable, and all compensation and claims therefor shall be exempt from all claims of creditors and from taxes.” NCGS § 97-21. This means that typically wage replacement and other payments from a workers’ comp case in NC can not be assigned, and are not subject to the claims of creditors or garnishment. However this provision does not apply to child support payments, which are not viewed by the North Carolina courts as “debts.”
Garnishment of NC Workers’ Comp Payments for Child Support.
Generally, up to 40% of an injured workers ongoing weekly workers’ compensation payments can be withheld or “garnished” and applied to meet child support obligations. Workers’ compensation payments are included as income for the purpose of determining a parent’s presumptive level of child support. Workers’ compensation awards or settlements can also be considered in determining the amount of support.
Lien for Past Due NC Child Support
Under certain circumstances, NCGS § 58-3-185(a) creates a lien against a NC workers’ compensation claim for past due child support. The lien applies to nonrecurring payments, including settlements, greater than $3000. Unlike the 40% cap for ongoing payments, there is no limitation on the percentage of a workers’ compensation settlement that can be applied to the child support obligation.
While the statute clearly sets out the precise conditions where the lien applies, insurance companies and employers frequently do not understand the requirements, and may insist that any outstanding child support obligation be satisfied from the settlement proceeds. So great care should be taken in settling workers’ compensation claims involving child support obligations. It is sometimes possible to negotiate the amount of the child support lien, particularly if the workers’ compensation claim is denied.
For more information about Child Support Issues in NC Workers’ Comp Claims contact Kevin Bunn, a North Carolina workers’ compensation attorney located in Cary, NC. Call or email for your free consultation with a NC workers’ comp lawyer.