Q. Does Oregon law require an employer to respond to a garnishment of wages received from an employee´s creditor?
 
A. Yes. When a creditor, or "garnishor," issues a proper writ of garnishment and serves the document on anyone "apparently in charge" of the office, the employer, also known as the "garnishee," must prepare a response within seven calendar days.
 
The employer must process the garnishment, first examining the writ to determine if it has been properly issued, and then completing a wage exemption calculation form that the creditor must provide. Generally, the writ must be issued and signed by the clerk of a court or an attorney who is an active member of the Oregon State Bar.
 
The employer is required to withhold wages of the employee, or "debtor," for a period of 90 days from the receipt of the writ, unless the debt is fully paid or released sooner than that time. If an employer fails to respond to the writ or fails to deliver payment to the creditor on time, ORS 18.775 makes the employer liable to the creditor.
 
The Oregon legislature revamped the garnishment statutes in 2001, moving them from Chapter 29 to Chapter 18 of the Oregon Revised Statutes and streamlining the garnishment forms and process.
 
Q. Does the law set a cap on the amount of an employee´s wages that can be garnished?
 
A. Yes. The maximum amount of wages to be withheld, defined in ORS 18.385, is generally 25 percent of the employee´s disposable earnings - the net amount the employee receives after taxes. The law also says that an employer may not leave the employee with less than $170 of net disposable earnings in one week.
 
When an employer is withholding wages because of back child support due, ORS 25.414 provides that up to 50 percent of the employee´s net disposable earnings may be withheld.
 
Q. What do we do if we receive multiple garnishments for the same employee? Which garnishment takes precedence?
 
A. Pursuant to ORS 18.627, an employer is generally required to respond to garnishments in the order received. If the first writ does not garnish all of the available non-exempt wages, then the employer must process the second writ concurrently to capture any remaining wages up to the garnishment cap.
 
An exception to the "first in time, first in right" rule is that child support orders take priority over other garnishments and jump to the top of the line. State and federal tax levies also have greater priority than other garnishments.
 
Q. Can an employer discharge an employee because his or her wages are garnished?
 
A. No. ORS 25.424(3) makes it an unlawful employment practice for an employer to terminate or refuse to hire an individual or to otherwise discriminate, retaliate or take discipline against an employee because he or she has been subject to a support withholding order. And ORS 18.385(9) prohibits employers from terminating an employee because he or she has had wages garnished.
 
Q. Where can an employer turn for help in responding to writs of garnishment?
 
A. Because of the complexity involved in processing garnishments, some employers choose to enlist the help of a professional payroll service company. You may also wish to contact an employment attorney who is knowledgeable in the area of garnishments.
 
For assistance in responding to wage withholding orders for child and spousal support, contact the Division of Child Support at the Oregon Department of Justice. See www.dcs.state.or.us for contact information and frequently asked questions.
 

 

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The Technical Assistance for Employers unit offers employer seminars, handbooks, and other materials covering a number of topics. For additional information, visit our website at www.oregon.gov/boli/ta  or call our Employer Assistance line.

 

Technical Assistance for Employers

Bureau of Labor and Industries

800 NE Oregon Street, Suite 1045

Portland , OR 97232

971-673-0824

www.oregon.gov/boli

These materials were prepared as a general summary and teaching guide. The mission of the Technical Assistance for Employers Program is to promote compliance with civil rights and wage and hour laws through education. Technical Assistance does not provide legal advice. In order to determine the legality of any matter or to protect your legal rights, you should contact an attorney. Check the yellow pages of your telephone directory or contact the Oregon State Bar Lawyer Referral Service at 1-503-620-0222 or 1-800-452-7636. THIS INFORMATION IS AVAILABLE IN AN ALTERNATE FORMAT.