Third Party Payment Set-Up

The Third Parties screen is used to set up a check or ACH payment for any garnishments, benefits or other deductions withdrawn from an employee’s check. In order to set up the check, navigate to Client Management > Payroll > Third Parties.

 Follow the instructions below: 

• Third Party Name: Add the third party or agency name for this garnishment payment. The name will display on the check as the payee. 
• Third Party Type: There are (3) options for Third Party Type. The type will determine where the third party payment will appear. Here are the types: 
  • Benefit Provider – if this type is selected, the Payee information will appear on the Benefit Plans screen under Pay Items. You can select the third party payment under EE Payee and ER Payee. 
  • Garnishment Payee- if this type is selected, the Payee information will appear on the Garnishments screen under Client Payee. 
  • Other Third Party - if this type is selected, the Payee information will appear on the Deductions or Memo Calculations screens under Payees. 
• Third Party Code: This field can be added for third party imports and exports. This is not a required field. This is only used for Benefit Provider third party type.  
• Partner: A drop-down list will contain any companies listed under Security > Partner Users. This is only used for Benefit Provider third party type and is optional. 

Address 

The address added here will be address that is printed on the third party check if the Payment Option Individual Check or Combined Check is selected. In order to add an address, click on Add Address. Add the address information. Once saved, this information will be available on the 2nd tab on this screen.  

Payment Information

The Payment Information section is to determine the method of payment and there are many options available. Click on Add Payment Information to get started. Let’s review the options: 

Other options under the Payment Information can described below: 

• Payment Schedule: This selection indicates when the payment check or ACH will happen. If you select Individual ACH, Individual Check or Individual ACH Employee Bank, the payment schedule will default to Every Payroll and cannot be changed. If any of the other options are selected, you may select the following payment schedules: 
  • Every Payroll 
  • First Pay of Month 
  • Last Pay of Month 
  • First Pay of Quarter 
  • Last Pay of Quarter 
  • First Pay of Year 
  • Last Pay of Year

This selection does not affect the schedule for the deduction or benefit. However, this selection affects how often those funds get paid. If anything but Every Payroll is selected, the funds deducted from the employee’s check will remain in the client’s account until the payment schedule option comes due. 

A report generates with the Payroll Register called Third Party Payments to advise the client of the accumulated total for the deduction. A check number will print when the payment is paid and the funds will be withdrawn from the client’s account at that time. 

• Check Reference: The information entered here will print on the check stub. It will also be an identifier for the third party payment when selecting it on the garnishment, deduction, memo calculations or benefit screens. 
• Transit Number: If ACH payment or Individual ACH is selected, please add the Transit or Routing number these funds should be deposited to. 
• Account Number: If ACH payment or Individual ACH is selected, please add the Account number these funds should be deposited to. 
• Account Type: Select Checking, Savings or Pay Card option as the type of account.  
• Is Corporate Account: Select this checkbox if the bank account is considered a corporate account. 

Once the Third Parties check or ACH is saved, it will appear on the fourth tab on the screen. 

Contact

The Contact Information section is to an optional entry. If you want to add a contact from the third party provider, click Add Contact. Fill out the appropriate information. First and Last Name are required.  

Garnishment Payee 

Once you have added the third party check, you must link the entry to the appropriate screen depending on the Third Party Type selected. If you selected Garnishment Payee type, go to Employee Management > Employee Pay > Garnishments. 

Any entries in the drop-down box under Client Payee were added on the Third Parties screen. Once selected, it will generate a check or ACH payment with each payroll for you to send to the appropriate agency. These third parties must be set up prior to accessing the employee garnishment screen. 

ACH Payee will generate an ACH payment to the agency with a breakdown of each garnishment details. The payees in this drop-down menu come from a system level table for Garnishment Type – Child Support only. Many Service Bureaus have a relationship with many states in order meet the standards for the child support payment. Select the appropriate state and the agency will appear in the drop-down. Any agency that appears in the list has a tested ACH process. If you do not see a state agency that you need, add a third party payee under Client Management > Payroll > Third Parties to generate a check for this child support or garnishment. It will appear under Client Payee. 

Note: Payment options for garnishment payees should be limited to check options only. If a combined check is used, additional reports may need to be sent along with the payment. Please review the Garnishment Check by Payee as an option for this supporting documentation. Please also review the Garnishment Payment Audit Report to ensure that all garnishments have a payment created.

You can add the reports for printing under Scheduled Report Options. 

Benefit Payee 

Once you have added the third party check or ACH payment, you must link the entry to the appropriate screen depending on the Third Party Type selected. If you selected Benefit Payee type, go to Client Management > Benefits > Benefit Plans. Under Pay Items, select the third party check or ACH payment created. You may need to add the entry under both EE Payee and ER Payee if the employer is contributing to the benefit selected. 

Once selected, it will generate a check or ACH payment with each payroll for you to send to the appropriate Payee. These third parties must be set up prior to accessing the Benefit Plan screen.

Note: If the client is not using Benefit Plans, you can link the third party payment to the deduction or memo calculation for any medical, dental, or vision type deductions. 

Other Third Party Payee 

Once you have added the third party check, you must link the entry to the appropriate screen depending on the Third Party Type selected. If you selected Other Third Party Payee type, go to Client Management > Payroll > Deductions or Memo Calculations. Select the deduction or memo code to which this pertains and access the Payees tab. The third party payment using Other Third Party Type will be available in the drop-down box. Select the appropriate payee. If multiple legal companies, select all that apply. 

Individual ACH Employee Bank 

If the Payment Option, Individual ACH Employee Bank is selected, the payment must first be linked to the Benefit, Deduction and Memo code. However, the bank account information is added to the employee. See below: 

• Add the dollar amount per pay under Amount. 
• Add the Routing Number. 
• Add the Account Number. 
• Click on the Save icon. 

If the employer is also contributing, go to the memo code for the ER contribution and add the third party payment under Client Management > Payroll > Memo Calculations – Payees tab. 

If your HSA plan has the payees attached and you are utilizing either the “Individual ACH” or the “Individual ACH Employee Bank” option, the system will no longer pull the deduction or the memo calc if the employee does not have their routing/transit number and bank account number set up. Once the routing/transit and account number is set up/defined on the employee, the deduction and memo calc will be pulled on the check. The system does not go back and pull any deductions that were missed due to this not being set up properly on the employee’s account. 

Reporting 

The payroll register will display all third party payments on the last page of the register. ACH payments will also appear on the last page of the direct deposit register. Payments by check will appear at the bottom of the check register. 

The Payroll Summary will indicate the number of Third Party Payments or Voids.

Below is an example of how the payment check may appear: 

Check reference (circled) is the Case Number from the Employee Garnishment screen. 

Remember if it is a combined check, this information will not appear and the report “Garnishment Checks by Payee” must be sent to the agency for a breakdown.