A wage garnishment is an order from the court to allow a deduction from an employee’s salary. The court describes the garnishment as a percentage of an employee’s compensation deducted for payment of legal obligation like child support or a debt. Wage garnishment can be frustrating, especially if you are financially struggling. Here is everything you need to know about wage garnishment, why your wages are being garnished, and what to do about it.
Wage Garnishment: What is It?
Wage garnishment or wage assignment is legal process through which a court orders an employer to deduct a percentage of their employee’s salary to pay a debt or meet an obligation. Fortunately, some state and federal laws on wage garnishment restrict or limit how far the garnishment can go. We will be discussing them shortly.
Do You Get a Notice of a Wage Garnishment Notice Before It Takes Effect?
You have already planned for every penny of your next paycheck, so getting a wage garnishment order could be a rude awakening. If you get a wage garnishment to pay off your creditor, it could be twice as hard since you are struggling to stay afloat. So, if your creditor is taking legal action against you, it is important to know if you will get a notice. Here are three things to know about a wage garnishment order:
- Once the court approves a wage garnishment, your employer can legally respond promptly as soon as they receive the order. Delaying to respond could attract a fine which varies according to the laws in your state. Although it is natural to get upset with your employer for enforcing the order, they must act quickly or pay a fine.
- The law doesn’t mandate employers to notify you of the wage garnishment. They also don’t have to give you time to explain or dispute a garnishment. However, they can provide you with a copy of the wage garnishment notice as a courtesy.
- Your employer cannot fire you because of a wage garnishment order. But if there is more than one order, you can lose your job. So, consider getting debt relief if you are bankrupt, or work with a bankruptcy attorney to manage your debts. It could save your job.
Can I Stop Wage Garnishment?
If you have an ongoing wage garnishment order, there are three ways you can try to stop it. Use our free stop wage garnishment calculator to estimate your garnishment amount if your employer didn’t share it with you. The calculator will also show the cost, other viable options, pros and cons of stopping your wage garnishment
Why Is Your Wage Being Garnished?
There are three reasons why your wages may be garnished. They are:
- You are behind on your child or spousal support payments or both. This is the most common reason for wage garnishment orders
- A creditor has sued you, or a debt collector who bought your debt has taken legal action with the courts to ensure you pay the debt.
- You have a pending federal debt like a federal student loan or federal taxes.
Wage Garnishment Due to an Outstanding Consumer Debt
If you have an outstanding debt, you have been unable to keep up with, your creditor might sue you or sell your debt to a debt collector who can also take legal action.
In this case, here is how the process works. Before proceeding to court, your creditor will get in contact with you, letting you know their efforts to have you pay have borne no fruits, and they will proceed to legal action.
The creditor will then sue you, and the court can rule in their favor. If it does, the creditor might request the court for a portion of your wage to collect their debt, provided wage garnishment is legal in your state.
The creditor issues a Request for Garnishment on Wages, and if successful, the court orders wage garnishment on you. They contact your employer and let them know.
NOTE: When your creditor or debt collector sues you, they are legally obliged to notify you so you can attend the court proceeding and defend yourself. If you fail to show up for the hearing, the court will likely issue a default judgment and rule in favor of the creditor. A creditor can then file for a Writ of Garnishment after the judgment. You will be notified of these proceedings against you. However, once the court orders a wage garnishment, your employer do not have to issue a separate notice about the course of action.
Important: In the case of federal debt like federal student loans or taxes, your creditors don’t have to sue you for wage garnishment to prevail.
What If I Was Not Notified of the Lawsuit By my Creditor that Led to Wage Garnishment?
If you did not receive any notice of court proceedings against you, you stand a chance to stop the wage garnishment. However, the stop may be temporary as your creditor might sue you again, with proper notice of the lawsuit, this time to get a wage garnishment again. So, if you didn’t receive a notice and have an active wage garnishment order, get in touch with a consumer attorney, and try to stop it for now.
What Can You Do If Your Wages Are Garnished Without Notice?
As previously discussed, your employer doesn’t need to give you a notice before approving the wage garnishment. Nonetheless, you have rights and need to understand your rights and options.
We receive complaints from people who suddenly realize their wages are being garnished. Here is one of the numerous complaints:
“I would like to know if wage garnishment is legal and what my rights are regarding garnished wages without prior notice. I have just checked my paychecks and realized they had been garnished by my wages. I did not receive notification from the collector, and HR did not notify me about it. I only realized it after getting my check, and the money had already been deducted.
I want to know why I didn’t receive a notice and whether these actions are legal because I don’t know the company taking my money, how much I owe them, and if I even had a debt to pay off. I need help on the next course of action to take. Thanks.”
Wage Garnishment Calculator
We built the following free wage garnishment based on your state’s guidelines to help you:
- Understand whether the amount you are being garnished is WITHIN the state’s guidelines. This is an estimate, but it should help.
- Provide options that can help STOP the garnishment.
The calculator is 100% free, and does not even require an email address unless you’d like additional analysis.
How to Find Out Who Requested a Wage Garnishment Order for Your Wages
Have you noted a wage garnishment from your pay slip but don’t understand why? You can find out who is behind that order by:
- Discussing it with your employer- the court notifies your employer after ordering a wage garnishment on their employee. So, your employer has a copy of the order, which outlines who took action. Therefore, you can know who is behind the wage garnishment by asking your employer.
- Get the services of an attorney- if the employer option did not work, consult a consumer bankruptcy attorney. They can act on your interest, research the order, and know who requested it. An attorney can also help you deal with or stop the garnishment order. They can also recommend debt relief options for you if you are in debt.
Wage Garnishment Laws That Protect Consumers?
There are federal and state laws that protect consumers from wage garnishment. The federal law is Title III of the Consumer Credit Protection Act (CCPA), which protects a percentage of your income from garnishment.
Title III puts a limit on the amount of your earnings that can be garnished, depending on the amount of your disposable income. The limitation applies despite numerous orders.
Commonly, we refer to disposable earnings as the income you take home after expenses. Legally, your disposable income is the income you have after paying legal deductions like taxes, Medicare, etc. When calculating disposable income for wage garnishment, your employer cannot legally subtract certain deductions from you. Examples of these would be life insurance premiums and union dues.
There are limitations to wage garnishments by employers to repay private debts. First, the wage garnishment must be legal in your state. States like North and South Carolina, Pennsylvania, and Texas don’t allow wage garnishment on consumer debts. However, a creditor might sue you in another state that allows wage garnishment and request your employer from that state to enforce the order.
You can get more information on state wage garnishment limitations through your state department of labor. The state attorney general’s office can provide more assistance and information.
If the wage garnishment is due to consumer debts, social security benefits will not be classified as wages. Therefore, they are exempt from garnishment.
How to Stop Wage Garnishment?
A court order seems final. Nevertheless, you can stop wage garnishment once it takes Effect. However, you will need to seek legal help. Sometimes, the wage garnishment order may not be correct. But since the court grants the order, it is a legal matter, and you need legal help.
Usually, there aren’t wage garnishment attorneys. You should seek help from consumer law or consumer bankruptcy attorneys. Find one in your state, and schedule a consultation. The attorney will recommend the best action depending on your case.
For example, your lawyer can advise you to file for bankruptcy if your creditor went to court and got a wage garnishment because you have defaulted on your loan. If the wage garnishment proceeds are going to federal taxes, your attorney can recommend reaching out to the IRS and working out a flexible settlement to repay your taxes.
In the case your garnishment is for spousal or child support, you might modify this order order by a judge. To conclude, an attorney can help you with garnishment, regardless of the reason.