Your company has recently hired a new person. Shortly after this individual begi

Question

Your company has recently hired a new person.

Shortly after this individual begins work, the company receives a "garnishment order." This court order specifies that a certain percentage of the employee's salary must be deducted each paycheck in order to satisfy a money judgment that has been entered against the employee.

After complying with the court order for several paychecks, the company receives another court order to stop paying the garnishment (it turns out the employee was not notified of the proceedings that lead to a money judgment against him).

A few months later, in the same case (it is a divorce case), the company receives ANOTHER court order directing the company to "garnish" a percentage of the employee's wages.

The boss shows up at your door.

"This is too much," he says. "I want to get rid of this guy because these garnishment orders are driving me crazy."

What would you advise the boss - about firing the employee for the garnishment orders, and about garnishment generally? What does the applicable federal law say and pick one state law on the issue as well. (Subject - Employment Law)

Use a minimum of one reference.

Explanation / Answer

Federal and state law regulates the type and amount of pay check deductions and wage garnishments that can be taken from an employee's income. Pay check deductions are amounts withheld from a worker's regular pay check, often for things such as approved pension contributions or health care expenses. Wage garnishment allows a creditor who obtains a court order to require your employer to set aside part of your pay check and send this directly to your creditor.

Federal law says you cannot terminate an employee whose wages have been garnished for one debt. But the law does not protect an employee from discharge if the employee's earnings have been subject to garnishment for second or subsequent debts. So boss cannot terminate employee for the garnishment orders.

A recent court case upholds the right of an employer to garnish wages if directed by legal order. In a 2010 case, an employee sued his employer because the employer would not stop a tax garnishment or reduce the amount. The employee lost his case, and the appeals court upheld the decision.

The federal Consumer Credit Protection Act (CCPA) limits the amount an employee's wages can be garnished. These limits apply to most personal earnings, including wages, salaries, commissions, bonuses, and pension or retirement income. The CCPA also protects employees from being terminated because of a single garnishment. However, the CCPA does not protect an employee from being fired because of multiple or subsequent garnishments.

Reference- http://employment.findlaw.com/wages-and-benefits/garnishment-of-wages.html

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