Back to Insights

Nonprofit Garnishment FAQs

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

  • Lorem ipsum dolor sit amet
  • Lorem ipsum dolor sit amet
  1. Lorem ipsum dolor sit amet
  2. Lorem ipsum dolor sit amet

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

What is a wage garnishment? Simply put, it is a legal procedure by which a person's earnings are required by court order to be withheld by an employer for the employee’s debt owed to a creditor. What should a responsible nonprofit employer do upon receipt of a wage garnishment notice? If noncompliant, an employer can be held liable for an employee’s debt – so first, take such matters seriously. The employer should complete and provide the required paperwork, possibly with an attorney’s assistance. What else should employers know and do? Read on for key questions and answers about properly handling wage garnishments.

How do creditors get wage garnishment orders?

Before an employer receives a wage garnishment notice as an attempt to collect money owed by an employee, an underlying court case is litigated between the employee and his or her creditor. The case may concern a car loan, other contract claim, child support, taxes, consumer debt, or other matters involving money in dispute.

If the creditor is successful in that litigation, the creditor will obtain a court judgment allowing the creditor to seek money from the employee. If the employee does not immediately pay the judgment, the creditor may seek recovery through the employee’s wages – essentially interrupting the employer’s compensation disbursement to the employee for work performed.

To obtain such recovery, the creditor must ask the court to issue a wage garnishment order to the employee’s employer. This order will instruct the employer to deduct a certain amount from each paycheck paid to the employee and to send that amount to the creditor, until the debt is fully paid. Garnishments are not uncommon. Creditors can gain a stream of revenue to recover payments owed – so long as employee/debtor remains gainfully employed, so the legal pursuit is often worth the creditor’s efforts.

Why are employers subject to wage garnishment orders?

A garnishment is a legally sanctioned option for helping creditors to obtain financial recovery. Wage garnishments are widely allowed under state law, so that creditors (known as “judgment creditors”) can gain access to an employee’s money (as earned through their employment) prior to the employer disbursing the funds to the employee (known as the “judgement debtor”).

Two important distinctions apply. First wage garnishments are not the same as wage deductions. Wage deductions are essentially agreements between employees and employers allowing for payroll deductions such as for taxes or for repayment agreements (e.g., damages to work equipment or improper reimbursements) and other financial obligations owed directly by the employee to the employer. Second, and as more fully addressed below, wage garnishments are subject to strict financial limits as a public policy matter – so that employees are not unduly burdened by their debts. The employer is typically responsible for identifying such limits (further discussed below), as a matter of complying with the wage garnishment order.

Must employers respond to the wage garnishment?

Yes, a wage garnishment is a legally enforceable court order. Employers must respond –typically through a written garnishment response filed with the court and served on the creditor and employee. Failure to comply with such requirements may result in a judgment issued against the employer, up to the full amount owed by its employee. This legal obligation is quite serious!

What information is typically requested from the employer?

Wage garnishment orders usually involve a set of employment status and compensation questions for the employer to answer. These questions may include whether the employee (as judgment debtor) is currently employed, how frequently the employee is paid, and the amount of pay. The order also usually directs the employer to calculate the withholding amount, based on a withholding formula that takes various factors into consideration.

If an employer does not employ the judgment debtor, the employer should respond as such. If the employer does employ the judgment debtor, then a full response is required – following by legally compliant wage withholding and corresponding remittance to the judgment creditor. Either way, the employer needs to make sure that response is correctly submitted as required by the court and doing so may warrant attorney involvement.

How much should employers withhold for wage garnishments?

State and federal law strictly limit the amounts that are to be withheld for wage garnishments, essentially to not unduly strain an employee’s finances. The court order should provide a formula for calculating the withholding amount. For example, Illinois law limits the amount that can be withheld to (1) no more than 15% of the debtor’s gross income before taxes or deductions, or (2) the amount of earnings minus deductions required by law exceeds 45 times the Illinois minimum wage.[1]

As part of an employer’s legal compliance, it should notify the employee of such wage garnishment action. To the extent an employee may thereafter object to the wage garnishment, such matter may be addressed through the underlying court proceeding or potentially through the employer’s corrections in the court garnishment form as warranted.

For how long must employers withhold and remit funds for the wage garnishment?

If subject to a wage garnishment order, an employer is required to withhold funds from the employee’s paycheck until one of several events occurs:

1. The employee ends employment with the employer;
2. The judgment creditor notifies the employer that the judgment has been fully satisfied; or
3. The court issues a subsequent order ending the garnishment.

Employers therefore need to remain attentive to further developments. If the employer inadvertently continues paying the creditor after receiving notice that the garnishment has ended, the employer could be liable to the employee for lost wages. Likewise, if the employer stops withholding and remitting garnishment amounts while the garnishment order is still in effect, the employer could be liable to the creditor for the missing amount.

Are employers legally allowed to terminate employees based on wage garnishments?

No. Employers are prohibited by law from taking any adverse employment action against the employees because of the garnishment. Such action is known as unlawful retaliation. The garnishment paperwork may seem like a burden and related risks may be unwelcome, but employers may not avoid them by terminating employees with garnishments. Note, however, that employers are legally allowed to otherwise discipline such employees as they would ordinarily do absent the wage garnishment.

Wage garnishments can easily get tricky, but they are part of any employer’s legal compliance responsibilities. Employers thus should be ready to handle them properly – upon initial receipt of a wage garnishment notice, through completion and submission of the wage information documentation, and onward until the garnishment period ends.

[1] 735 ILCS 5/12-803

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
No items found.