Garnishment is a process that allows creditors to remove payments directly from an employee's paycheck. Protections are available to employees who are subject to this process.
Wage garnishment is a system that is designed to allow a creditor to seek payment by taking money from a borrower’s wages directly from the employer. The garnishment process generally begins with a court hearing. During this hearing, the creditor is required to establish that the employee owes the creditor money. In most cases, the employee is notified of the time, date and location of the hearing. If the court finds in favor of the creditor, the employer is required to withhold certain funds from the employee’s paycheck.
Garnishment in Connecticut
In addition to removing funds from one’s paycheck, wage garnishment can also be taken from unemployment benefits. Connecticut’s Department of Labor notes that the state’s garnishment system has dramatically increased in efficiency over the last few years. This system focuses on garnishments specifically from unemployment insurance benefits. In 2011 the state implemented a new electronic process called the E-filing Garnishments process. The system has led to $1.29 million in garnishment funds, translating to a 93 percent increase in the amount of funds gathered through garnishments over previous efforts. Before implementing this system, the agency used "snail mail" to request garnishments. This resulted in approximately 30 garnishment requests per week. The new process results in approximately 450 garnishments per week.
Protections for employees
Protections are available for employees whose wages are garnished. The Consumer Credit Protection Act ensures that employees are not discharged from their positions due to garnishment. Protections also control the amount of wages that can be garnished. In a single workweek or pay period, the lesser of the following can be garnished:
- 25 percent of disposable earnings. Disposable earnings are defined as the amount that remains after legally required deductions have been made. This includes deductions like state and federal taxes, unemployment insurance and state employee retirement systems.
- Amount by which disposable earnings are greater than 30 times the federal minimum hourly wage. As of July, 2009, the federal minimum hourly wage was set at $7.25 per hour.
There are some stipulations to these protections. For example, the protections generally do not apply to certain bankruptcy orders or debts that result from taxes.
Remedies are available to employees whose employers violate these protections. Remedies can include reinstatement if the employee’s position was terminated as a result of the garnishment and repayment of back wages as well as a restoration of any wages that are improperly garnished.
Legal counsel can help
Wage garnishments can be challenged. Filing for bankruptcy can stop all wage garnishments by judgment collectors. A wage garnishment lawyer can discuss your options, which may include a petition for hardship or bankruptcy.