Can I Be Fired If My Wages Are Garnished?

The Consumer Credit Protection Act prohibits employers from terminating employees for wage garnishment "for any one debt," though people who are the subject of multiple garnishments may face career consequences. Creditors must obtain a court order to begin a garnishment, and the act provides for fines and penalties against employers who violate the act.

Penalties

Employers face tough sanctions. According to the Department of Labor, "Employers who willfully violate the discharge provisions of the law may be prosecuted criminally and fined up to $1,000, or imprisoned for not more than one year, or both." Employees who are fired because their wages were garnished may, therefore, be eligible for job reinstatement.

Limits

Federal law limits the amount of money that may be garnished from an employee's pay to 25 percent of an employee's earnings. Some states further restrict the ability to garnish wages. The federal law says that employers and courts must follow whichever law results in a lower garnishment. Some states, like Texas and Pennsylvania, forbid garnishment for commercial debts. A handful of states allow employers to tack on a fee, usually 2 percent, to cover the costs of administering the garnishment. Garnishments can be as high as 60 percent, however, if a debtor owes back child support.

Debt Collectors

The Fair Debt Collection Practices Act prohibits debt collectors from harassing or abusing debtors. According to the Federal Trade Commission, "debt collectors may not lie when they are trying to collect a debt," and they cannot say they will "seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so." If they say you'll be fired and you are the subject of no other garnishments or debts, they aren't telling the truth. The FTC accepts complaints against debt collectors, but the law allows debtors to sue abusive debt collectors for damages.

Multiple Garnishments

According to the Department of Labor, the act does not prohibit an employer from firing an employee who is the subject of two or more garnishments. Garnishments shouldn't come as a surprise, as the creditors must obtain a court order. If you are the subject of a garnishment order, negotiate with your creditors to form a payment plan.