Can I be Fired for having my Wages Garnished?

The short answer is no – your employer can’t terminate you for having one wage garnishment in effect.  However, in most states, this protection doesn’t extend to cases where your wages are being garnished two or more times (either consecutively or at the same time.)

Garnishment, a legal means of collecting an unpaid debt through a direct payroll deduction, can be used by credit card companies, banks, and other commercial lenders, as well as federal and state agencies to collect unpaid child support, student loans, and taxes.  Garnishments are governed under both federal and state law.

Title III of the Consumer Credit Protection Act (CCPA) is the federal basis for garnishment law, and it is under this act that the firing of an employee for one garnishment is prohibited.  However, some states provide additional protection against termination when more than one garnishment is in place, and when this is the case, the state law will be observed.  For example, in Florida, an employee can never be fired for reasons related to a garnishment.

But what about the reasons, if any?

There are a few different reasons why an employer might consider letting go an employee whose paycheck is subject to garnishment. If you are able to think like an employer, it’s easier to see why a garnishment is not desirable. First, the fact that a garnishment is in place means that the employee didn’t pay a debt (or debts.) This can give the employer the impression that their employee is untrustworthy or unreliable, and can also be cause for concern when the cash handling is part of their job.  They might also feel that the employee will be distracted and not perform their job well due to their financial distress.

Lastly, in a garnishment, the employer is responsible for withholding the required money and forwarding it to the appropriate party.  Therefore, handling the garnishment is simply an inconvenience for most payroll departments, and is simply more work for them to do.

Creditors use garnishment as a last resort, and if you are facing a wage garnishment you should make every effort to settle the debt as quickly as possible. Garnishments are public record, which means that anyone will have access to the information regarding your wage garnishment. Garnishment can also be damaging to your credit, making it harder to obtain a mortgage, credit cards, and other financing in the future. It’s much easier to prevent garnishment than it is to stop it, so your best bet is to contact the creditor as soon as possible if you’re facing a debt that you’re unable to pay. Most will be willing to work with you to avoid having to proceed with the wage garnishment.

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