10.15.14 |
SHARE   |  

Top Reasons for Wage Garnishment

Wage Garnishment 7.2Understanding the root cause of a problem is often the first step toward solving it – and mitigating its impact.  Wage garnishments – or debt recovery through pay seizures – are no different.  By examining the primary reasons U.S. employees have their wages garnished, employers and employees alike can start taking steps to avoid garnishments in the first place.

The ADP Research Institute® has released findings from a first-of-its-kind study on current trends in U.S. wage garnishments which revealed that 7.2 percent of U.S. workers, or about 9.5 million individuals, have their wages garnished.

So, what are the primary reasons for most of those garnishments? The study found that the majority of garnishments, roughly 40 percent, are for child support payments.  In addition, almost 20 percent are for tax debts.  Other miscellaneous types of garnishments also occur, including some for bankruptcy.

The percentage of an employee’s wages that may be garnished varies by the type of debt owed.  For most debts, the garnishment may not exceed 25 percent of an employee’s disposable weekly earnings.  In other cases, such as child support, up to 65 percent of an employee’s weekly disposable earnings may be garnished, while state and IRS tax debts can claim up to 100 percent of earnings minus all exemptions and deductions.  Legally required deductions, such as those for Social Security, state and federal taxes and others, may not be garnished.

Check back for the next post in this series, which will examine garnishment rates by industry and geography.   For a free copy of the ADP Research Institute white paper that outlines the study’s key findings, visit Garnishment: The Untold Story Whitepaper.

 

 
 


One comment on “Top Reasons for Wage Garnishment”

  1. Cool post! I learned a lot about wage garnishment by reading this article. Thank you for saying that “The percentage of an employee’s wages that may be garnished varies by the type of debt owed. For most debts, the garnishment may not exceed 25 percent of an employee’s disposable weekly earnings.” I don’t know much about wage garnishments so it would make sense to work with an attorney that know what he or she is doing.

Leave a comment

Your email address will not be published. Required fields are marked *


1-855-864-1712

Sign Up for
Email Updates

featured webinar