When someone’s wages are garnished, a court has ordered the person’s employer to take a specific amount of their wages to be paid directly to a creditor. The garnished wages don’t go to the employee at all but bypass the employee to go to a third party who makes sure they’re sent to the creditor.
What Kinds of Debts Can Lead to Wage Garnishment?
Child support is perhaps the most widely known form of wage garnishment, but many other types of debt where the debtor has fallen behind on repayment can also lead to garnishment. These include credit card debt, medical debt, student loans, and taxes. Unpaid mortgage debt can sometimes lead to garnishment as well.
What Kinds of Income Can Be Garnished?
The Consumer Credit Protection Act (CCPA) defines the types of income that can be garnished as wages, salaries, commissions and bonuses, profit sharing, moving or relocation incentive payments, retroactive merit increases, workers’ compensation payments, termination or severance pay, back and front revenue from insurance settlements, and income from a pension or retirement program. Usually, tips are not included.
Can My Employer Fire Me for Having Wages Garnished?
The CCPA specifies that employers cannot fire someone for having wages garnished for any one debt. However, the protection stops with that first debt. The employer can fire the employee if there is a second or subsequent debt.
How Much Income Can Be Garnished?
The CCPA sets the maximum that can be garnished in any pay period. For garnishments that don’t include child support, bankruptcy, or state or federal taxes, the weekly amount cannot exceed the lesser of two figures: 25% of the employee’s net earnings or the amount by which the employee’s net earnings are greater than 30 times the federal minimum wage, which is currently $7.25 an hour. Garnishes for child support or alimony can be significantly higher, allowing up to 50% of the employee’s net earnings.
Does the Garnished Wage Calculation Come from Gross or Net Income?
The amount of the wages garnished is calculated based on an employee’s net earnings, or the amount left after legally required deductions have been taken from the wages. These include federal, state, and local taxes and Social Security, Medicare, and state unemployment insurance taxes. Deductions that aren’t legally required, including union dues, life and health insurance, charitable donations, savings bond purchases, or retirement plan contributions (except where required by law) are not considered when calculating the garnished wages.
How Can I Stop Wage Garnishment in Illinois?
Once the court approves a garnishment, Illinois debtors have few options. There’s always the possibility of negotiating with the lender, but by the time garnishment has been ordered, the debtor doesn’t have much credibility. The other options include paying the garnishment sum in full, either at once, through the repayment period, or by declaring bankruptcy.
Let Us Advise You
If you or someone you know is facing wage garnishment, call us at 708-575-1500 to work with one of our experienced attorneys.