Wage garnishment is a complicated matter that any employee is vulnerable to. Knowing how to navigate it can be quite complex for small to medium-sized enterprises that may not have the resources available to do so with their HR department or HR provider. Seeking a business lawyer who is well versed in employment matters can help you to go forward with any wage garnishment orders confidently, and avoid any pitfalls or instances of noncompliance along the way. Below, we’re covering what wage garnishment is, instances in which it may be applied, and what employers need to know about wage garnishment management for their employees.
What is wage garnishment?
Wage garnishment is when there is a court order requiring employers to hold a portion of an employee’s paycheck. Beyond simply holding the requested amount or percentage, you may also be asked to send it to a specific location or entity on the employee’s behalf. This can make for some very terse times and communication between you and your affected team member, which is why it is important to rely on human resources departments and services wherever possible, as well as the expertise of a business lawyer. This can help you to avoid potential instances of noncompliance or any fees associated with incorrect filing or processing.
Why does wage garnishment happen?
Wage garnishment can happen for a variety of reasons. If you receive a court order for wage garnishment for your team member, it is highly unlikely that there will be any sort of detail provided to you beyond the percentage, where that percentage must go, or how it must be processed. Wage garnishment can occur due to:
- Nonpayment from the team member to an outstanding creditor
- An opened lawsuit due to nonpayment from a creditor
- Open back payments on debts from tax agencies or child support
Wage garnishment is a private employee issue, and you should not concern yourself with your team member’s circumstances that led to the garnishment order. Rather, you should take proper precautions to make sure that you are filing it correctly and in compliance with the local laws of your state and employment agency, if applicable.
How to navigate wage garnishment as an employer
If you have been given a court order on behalf of your team member for garnishment to take place, there are several key things that you must know in order to deal with the situation in light of current best practices. Below, we’ve created a quick guide of key details and steps to take if you’ve been served with a court order for garnishment.
1. Avoid instances of discrimination
Wage garnishment is something private, and it is illegal to discriminate against the employee that the garnishment is related. This is not limited to instances of abuse or another type of mistreatment at work and can extend to any situation in which the employee receives special treatment or is singled out of the group. This can be a pitfall, as employers may be tempted to speak to an employee to “help” the situation. We recommend against this, as it could be perceived as discriminatory behavior or work against you legally.
2. Reach out to a business lawyer
Garnishment is complex and requires the assistance of an experienced business lawyer to navigate. It is not always as simple as withholding and remitting the funds to the proper agency per the court order. Your team member may choose to fight the garnishment order, or it may become more complicated due to other contextual factors. Investing in a business attorney, as well as an HR resource, may be your next best step depending on what you have in place to help you to navigate the situation.
3. Determine the correct next step of the garnishment process
Generally, your employee will be aware that there is a garnishment pending and may be notified when you receive the notice. Determining your next correct step in the process is crucial in order to handle the matter properly. The employee may choose to contest the wage garnishment order, in which case you would contact the issuing court and your business lawyer to determine who would be in possession of the funds that you’ve been asked to hold. This is where a business lawyer can be especially helpful and can work between both entities: your team member and their lawyer if they’ve retained services, as well as the court. If it remains uncontested, you may still rely on your business lawyer to help you comply with the order and arrange the administrative portion of the payment process to the proper agencies and creditors.
Ascent Law is here to help you navigate the nuances of wage garnishment
Looking to handle a wage garnishment issue? The experts at Ascent Law are here to help. Continue in confidence and take advantage of a free introductory call with one of our experts by calling our office at (801) 432-8682. We look forward to speaking with you soon!