Understanding Wage Attachment for a Loan

When the organization lends money to an employee, you can simplify the records that are required to track the payments by entering the loan as a wage attachment. Entering the loan as a wage attachment also simplifies the tracking of any fees and interest associated with the loan.

If the company does not charge a fee or interest on a loan to an employee, you can enter the loan as a deduction with a declining balance instead of as a wage attachment. This type of loan deduction does not appear on wage attachment reports.

When you enter a loan wage attachment for an employee, the system calculates the amount of the deduction based on the amount due. If the employee does not earn enough in a pay period to pay the loan deduction, the system does not calculate any fees or interest associated with the loan.