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How Does Wage Garnishment Work?

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Wage garnishment occurs when an employer withholds the earnings of an individual for the payment of a debt as the result of a court order or other equitable procedure. The Consumer Credit Protection Act (Ccpas/what-is-a-cpa.php">CPA) prohibits an employer from discharging an employee because his or her earnings have been subject to garnishment for any one debt, regardless of the number of levies made or proceedings brought to collect it. It does not protect an employee from discharge if the employee's earnings have been subject to garnishment for a second or subsequent debt.

The Ccpas/what-is-a-cpa.php">CPA also protects employees by limiting the amount of earnings that may be garnished in any workweek. This limit applies regardless of how many garnishment orders an employer receives.

In court orders for child support or alimony, Ccpas/what-is-a-cpa.php">CPA allows up to 50 percent of an employees disposable earnings to be garnished if the employee is supporting a current spouse or child, and up to 60 percent if the employee is not doing so. An additional five percent may be garnished for support payments over 12 weeks in arrears.

Disposable earnings is the amount of earnings left after legally required deductions, such as federal, state and local taxes, Social Security, unemployment insurance and state employee retirement systems, have been made. Deductions not required by law, such as union dues, health and life insurance, and charitable contributions, are not subtracted from gross earnings when the amount of disposable earnings for garnishment purposes is calculated.

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