The Drafting Committee on a Wage Garnishment Act met on Oct. 23-24 in Falls Church, VA, and made great progress. Our reporter, Steve Willborn, prepared a terrific draft that incorporated the comments we received last summer in Williamsburg, and we had time to review the draft in depth.
One of the ways in which our act will improve on current law will be the quality of the notification that will be provided to employees. We are raising funds (successfully so far but with a bit to go) to engage the services of a plain-language specialist who will help us with both the language and the manner of presentation. Under the act, wage withholding cannot begin until the first payday occurring more than 30 days after the notification is sent to the employee.
We will be seeking an expansion of our charge from Scope and Program so that we can extend the protections of the act to wages deposited into a bank account. Many employees today are “unbanked” because creditors can reach all the funds in their bank accounts. Under our act (and federal law), wage garnishment is limited so that employees have a reason to keep working and at least some money to live on. The ability of creditors to reach post-garnishment wages in an employee’s bank account dilutes the protections of our act, and we will be considering ways in which the employee can assert an exemption for those wages if the account is garnished. We have had preliminary discussions with representatives from the banking community and are cautiously optimistic that our goal can be achieved.
The committee also decided to explore whether the protections of the act can be extended to a cadre of workers who are classified as independent contractors but who are similar to employees in that they provide personal services and are paid on a regular, ongoing basis. Our Reporter will prepare provisions designed to accomplish that goal and the committee will review them at its spring meeting and determine whether they are feasible.
All in all, it was an excellent meeting, and we look forward to presenting our work at the ULC’s annual meeting in Stowe, Vermont, next summer. The current draft of the Wage Garnishment Act is posted on the ULC website and is available here.
William H. Henning, Chair, Drafting Committee on a Wage Garnishment Act