Federal Child Support Agency Adapting for the Future of Work

The federal Office of Child Support Enforcement is updating and modernizing its child support procedures in light of modern workforce trends, OCSE Commissioner Tanguler Gray said March 20.

Employers can expect the OCSE to emphasize “people, processes, and performance” as the office works on improving its child support program, Gray added. “People” refers to the OCSE’s efforts to collaborate with employers, while “processes” involves streamlining child support procedures between agencies on the federal, state, and local levels. The last focus, “performance,” is the OCSE’s use of data to ensure that the office is meeting its goals and that the child support program is moving in the right direction.

“Child support was started in 1975, and the people that we were serving in 1975 are not the same as the people we are serving in 2023,” she said at the American Payroll Association’s Capital Summit. “So, I want to ensure that we get recommendations and make enhancements that will better serve the family structure today and moving forward.”

The OCSE has made enhancements to its forms by creating electronic versions of them that have been widely adopted across the US, said Sherri Grigsby, OCSE’s deputy director of its federal systems division. Across the country, 53 of the US’s 54 states and territories currently use the office’s electronic version of the federal Income Withholding Order form, and the office hopes to similarly expand the use of the electronic version of the National Medical Support Notice in the coming months.

The OCSE made another technological improvement by adding the Communication Center feature to its child support portal for employers, Grigsby added. The Communication Center allows employers to securely exchange messages and documents with child support agencies without the need to send encrypted emails to protect personal information. Over 3,400 active Federal Employment Identification Numbers are currently registered for the center across the 36 states that have authorized its use, she said.

“It’s a great way for you to be able to communicate with the child support agencies about withholding orders, payments, lump sums, verification of employment, medical support, and a variety of different topics,” she said. “We are always looking for ways to make enhancements to help employers and the child support community.”

Ongoing Challenges

Two ongoing challenges facing the federal child support program are daily payrolls and the lack of independent contractor reporting for child support purposes, said Corrine Flores, ADP LLC’s government affairs director for wage garnishments.

The federal laws and regulations governing the child support program are based on traditional employment patterns, in which employees are regularly paid through payroll on a weekly, semimonthly, or monthly basis, Gray said. Today, more and more workers are being paid through untraditional means, including daily distributions through Zelle or Venmo.

“I am very concerned,” Gray added. “The bottom line is we collected a little over $32 billion in child support through this program in the last fiscal year. But, of that $32 billion, more than 67% of that money is processed through the employer community. As child support caseloads decline nationally and people transition out of traditional employment jobs, how will we continue to be relevant in this space?”

The OCSE encourages employers to provide suggestions and feedback on how to update the office’s current rules and regulations, Gray said. Employers that regularly pay wages are best equipped to understand how to solve the problems and challenges associated with earned wage access.

The second and related challenge to the federal child support program is the rise in the number of gig workers who perform services as independent contractors, Flores said. Currently, only 19 states require employers to report independent contractors for child support purposes.

Employers are not required to report independent contractors for child support purposes under federal law, but the OCSE is working toward establishing such a requirement, Gray responded.

The main obstacle toward creating such a requirement is the length of time it takes to make such legislative and regulatory changes. Legislative changes can take multiple years to enact, while regulatory ones typically take 18 to 24 months to implement, she added.

“I want to get something across the finish line,” she said. “If I had the authority to make it a federal mandate through the administrative process, I would have done it on Dec. 7, and I came into this role on Dec. 6.”