Tax withhholding versus 401k deferral on irregular pay

Our client's document says deferral election applies to irregular pay.  However, they often issue very small second checks for some reason.  (like under $100); an issue arose when the payroll company withheld FIT on a small check and no 401k deferrals....they quoted the OHS (OFFICE of HUMAN SERVICES) that FIT withholding takes precedence.  Anybody seen it handled differently?  The plan was audited by a CPA firm and they took issue with no deferrals being calculated prior to FIT.   So an impasse.....  

I agree that taxes take precedence over deferrals.  The objection from the auditor is improperly stated - were deferrals not "calculated prior to FIT" or not withheld because there was nothing left or because they were overlooked?  In any event how big a fuss is the CPA firm making over it, and can('t) you just say "so what do you want to do about it?"