Having your wages garnished can be a significant ordeal, and without knowing the laws that govern garnishment, many employees are blindsided when it occurs. A number of the federal provisions concerning wage garnishment, however, are put in place to protect the income of employees, and to ensure that employers deal with them fairly in the event that wages must be withheld.

However, navigating through federal wage garnishment provisions is not easy. For instance, for those wondering exactly how much the maximum amount of income that can legally be withheld by a wage garnishment court order, it may take a bit of deciphering. For ordinary wage garnishment, the maximum amount that can be garnished is 25% of an employee’s disposable earnings or the amount by which the employee’s disposable earnings are greater than 30 times the federal minimum wage.

Naturally, this is not the easiest calculation to figure, especially if there are other questions which need answering such as, what exactly are ‘disposable earnings’, and exactly how much is 30 times the federal minimum wage? This post will help explain some of those details and a few other particulars as well.

What is Wage Garnishment?

Wage garnishment is a court ordered withholding of an employee’s wages. Reasons for wage garnishment include payment of debts such as federal student loans and private debts or other to address other payments which have lapsed such as child support payments.

Which Law Governs the Practice of Wage Garnishment?

The main law governing wage garnishment, and thus protecting employees from unlawful garnishments, is the Consumer Credit Reporting Act (CCPA) which is enforced by the Department of Labor’s Wage and Hour Division.

5 Key Facts to Know about Wage Garnishment

1. Title III of the Consumer Credit Reporting Act (CCPA) protects employees from discharge.

Title III of the CCPA prohibits employers from firing or terminating the employment of a worker who experiences wage garnishment. This means that employees cannot be fired simply because wages are being collected by a debtor at their place of employment. According to the Act the amount of wages garnished are of no consequence for this ‘no discharge’ rule to apply. Nor does it matter that more than one levy has been placed or that more than one proceeding is being conducted in order to garnish the wages. No employer has the right to fire an employee simply because his or her wages are being garnished.

Additionally, an employer is also prohibited under Title III from garnishing more than a specifically set amount of income in one week. As mentioned this calculation is 25% of income or no greater than 30 times the minimum wage, which currently is $7.25

However, an employer is entitled to discharge an employee if more than one debtor requests wage garnishment. Also, it is important to note that Title III may not apply to tips. This is because the CCPA applies to the personal ‘disposable’ earnings of employees including wages, salaries, and income for retirement or pension plans, but does not extend coverage to tips.

2. The Department of Labor Wage and Hour Division hears wage garnishment complaints.

When an employee experiences violations of Title III of the CCPA concerning the garnishment of wages, a complaint should be filed with the Wage and Hour Division of the Department of Labor. The wage and Hour division has over 200 offices located throughout the country, and all services are free and confidential.

When filing a complaint be sure to include all necessary contact information, as well as information about your employment, such as the name and address of your manager or supervisor, the type of work you do, the position held and the detailed nature of your wage garnishment complaint.

3. When both federal and state wage garnishment laws apply, employers must recognize the lesser amount of garnishment.

The amount of wage garnishment can sometimes be different under federal law than under state law. When there is a discrepancy between the amount under federal and state law, an employer is obligated by law to garnish the lesser amount. For illustration, if under the federal law formula for wage garnishment amounted to $500 deducted from an employee’s weekly income, and the state law garnishment allotted for a $250 deduction, an employer would be required to follow the $250 deduction in order to comply.

4. Violations of wage garnishment laws may result in a number of penalties or sanctions.

The CCPA is federal law which covers all employers and all employees receiving personal earnings in all 50 states, the District of Columbia and within all U.S. territories. When an employer violates the provisions of the CCPA, he can and should be held liable. This could result in a number of penalties and sanctions.

Title III outlines these remedies for wage garnishment violations:

  1. Reinstatement of discharge employment
  2. Back wages
  3. Restoration of mistakenly garnished amounts.

Failure to garnish wages properly may also result in penalties and fines. For instance, an employer can expect to pay at least a $1000 fine and serve at least one year in jail for willfully violating Title III provisions on wage garnishment.

5. Employment Rights Attorneys Can Assist with Wage Garnishment Issues

The best way to address a wage garnishment issue is to consult a competent attorney with experience dealing with a wide variety of employment law issues. Often is takes the skill and expertise of an attorney to get the attention of employer who are reluctant to follow the law or who are unaware of the consequences of their actions concerning employee rights.

If you are face with a wage garnishment issue…

If you are faced with a wage garnishment issue, whether quite small or very complex, get help from an attorney right away. You’ll need the assistance of a competent  attorney especially if you are owed back pay, are fighting for reinstatement or if you’d simply like to ensure that your wages have been garnished correctly.