Ohio has wage garnishment laws that set forth when and how a creditor may garnish a debtor’s wages. Wage garnishment is the legal process by which a creditor takes part of your wages from your pay check before you are paid, thus reducing your take-home pay. Both federal law and Ohio law put limits on how much of your wages can be garnished. In this respect, Ohio law provides about the same level of protection as federal.
Generally speaking, both provide that a creditor may garnish up to 25% of your wages and no more to satisfy the unpaid debt. Depending on the circumstances, however, this percentage can be more or less.
Garnishing Wages in Ohio
Usually, the creditor must obtain a money judgment against you before it can garnish your wages. However, in Ohio there are certain exceptions to this rule. Under Ohio law, some debts support garnishment without a court order. Here are some of the exceptions that do not require a court-issued garnishment order:
- Money, fines or penalties owed to the government.
- Arrearages in court-ordered child support, alimony or spousal support.
- Unpaid income taxes.
- Student loans that have fallen into default.
Ohio Wage Garnishment Does Have Some Limits
Like most states, Ohio wants to make sure you have sufficient funds on which to live and care for your family after your wages have been garnished. Thus Ohio places limits on the amount creditors can take from the debtor’s pay check. Exactly like federal law, Ohio limits wage garnishments to either 25% of your disposable wages, or the amount of your disposable earnings, less 30 times the current federal minimum wage.
Disposable wages are those wages remaining after deducting taxes and mandatory deductions such as UI and Worker’s Compensation. Deductions for items like health and life insurance do not count as mandatory deductions.
For example, if you are paid $500 every week after taxes, 25% of your disposable income is $125. For a worker with health insurance coverage from his or her employer, the hourly rate is $7.25 for workers with medical coverage, and $8.25 for workers without such coverage. Your disposable wages less 30 times the federal minimum wage if you have medical coverage is $282.50. Since the law requires the employer to withhold the lesser of the two, it will send the creditor only $125.
Priority for Certain Garnishments
Sometimes a debtor is subject to more than one garnishment order. In that case, certain garnishment orders take precedence over others. For example, unpaid child support, unpaid taxes and unpaid student loans all take precedence over unpaid credit cards, consumer loans and even medical expenses.
Garnishments for Child Support
For nearly three decades all courts orders for child support come with a built in mechanism for wage garnishment. Like many other states, Ohio has adopted the limits set out in the federal Consumer Credit Protection Act (CCPA) as to the amount that can be garnished for child support. The CCPA allows as much as 50% of your disposable wages to be garnished to pay child support in situations where you support a spouse or a child who is not covered by the order, and as much as 60% in all other situations. If your support payments are overdue more than 12 weeks, the garnishment may include an addition 5%. Where you have multiple child support garnishment orders, your garnishment is divided among them depending on how much is owed to each.
Income and Benefits Exempt from Garnishment
Ohio makes certain income and benefits exempt from garnishment depending on the kind of debt involved. For example, worker’s compensation benefits and unemployment benefits are protected from garnishment for unpaid consumer debts, credit cards, and the like. However, even these income sources are subject to garnishment for child and spousal support.
When you face multiple garnishment orders, the sum total that can be garnished for most debts is 25% of your disposable wages. As an example, if the state is garnishing 10% of your wages for unpaid state taxes, and your employer receives a second garnishment order for unpaid credit card bills, your employer can only take another 15% of your disposable wages.
Job Termination Prohibited
No employer likes the extra burden of complying with wage garnishment orders. It is complicated and time-consuming. As a result, some employers would rather just terminate the employee and avoid any further hassle. Both federal and Ohio law prohibits such termination for having to deal with one such order. While federal law provides no protection for two or more orders, Ohio law bars your employer from firing you for multiple garnishment orders from the same creditor over a 12-month period, and precludes any termination in response to a child support garnishment.
www.com.ohio.gov/laws – Ohio Department of Commerce’s Bureau of Wage and Hour Administration
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