More policing needed for fraudulent garnishee order deductions


“Some of it will be 10 rand per order, others will be 3000 to 4000. I’ve got ones showing 20,000 of over deductions. So there are extreme cases, but there’s always a breach,” Summit Garnishee Solutions founder Clark Gardner told CNBC Africa on Thursday.

A garnishee order is an order from the magistrate’s court to the employer to make a deduction from an employee’s salary. This is in order for the employee to pay defaulted or outstanding debts to their relevant debtors.

A number of garnishee order deductions have become illegal as more money is sometimes deducted from an employee’s payroll than stated by the garnishee order.

According to Gardner, this fraudulent activity occurs because of the grey areas in the National Credit Act, which governs the debt, as well as in the garnishee order.

Poor policing of the garnishee order deductions exacerbate the fraudulent activity.

“Companies outsource their garnishee deductions, we make sure they’re accurate, affordable and valid, and then we remove the administrative burden by interfacing into the payroll via the Q Link platform,” Garnder explained.

Q Link, which belongs to IT outsourcing company Business Connexion, is responsible for providing an interfacing platform into a number of collection mechanisms, including banking and payroll.

The Q Link unit provides better voluntary or involuntary offerings into payrolls, thereby solving the current garnishee order over deduction problem.  

“You can make sure that every employee can afford a garnishee deduction, and even if it’s three per cent. If that three per cent is stealing from your employees, I think we have a responsible role as employers to make sure that that employee gets valid, accurate and affordable deductions being taken place,” he said.

 Business Connexion announced that it would be selling its Q Link business to Summit Garnishee Solutions for 187.5 million rand.

“If you have a look at the rationale for the deal, we believe quite strongly  and passionately about the current financial crisis that consumers are experiencing, and we believe that one of the most effective mechanisms to manage that crisis and provide solutions is to manage the service providers,” said Gardner.

“If you give them tools and platforms to enable them to make affordable and responsible deductions, both in terms of sustaining the industry and protecting the consumer, I think we have the best solution out there.”