For employers, receiving garnishment orders is an all-too-common experience. If one of your employees falls behind on child support payments or has a judgment entered against her, you could receive a garnishment order directing you to make payments toward that obligation out of the employee's wages. As commonplace as receiving a garnishment order may be, the penalties for being inattentive to such orders are extraordinary. As an employer, you need to be aware of, and prepared to satisfy, your obligations under Kansas wage garnishment law.
Background on wage garnishment in Kansas
In 2002, the state legislature amended the garnishment statutes, making the rules substantially consistent in Chapter 60 cases (the typical civil case) and Chapter 61 cases ("limited action" civil cases). Now, the substantive requirements for employers who have received garnishment orders are essentially the same under both chapters.
Below are some basic guidelines that should help you navigate Kansas wage garnishment rules and the way they have been applied since their 2002 update. This article does not cover all of the rules' nuances. Employers who fail to follow the rules face harsh penalties in Kansas, so you are advised to seek the advice of counsel in handling garnishments.
What is wage garnishment?
When you receive a garnishment order, it means that one of your employees owes a judgment creditor money and the creditor wants to collect the debt by forcing you to withhold money from the employee's paycheck.
On a garnishment order, you will be listed as the "garnishee." The party seeking the garnishment is the judgment creditor. And your employee is the judgment debtor.
When dealing with garnishments, you're likely to encounter two special terms:
(1) "earnings," which means compensation paid or payable for personal services, whether denominated as wages, salary, commissions, bonuses, or otherwise; and
(2) "disposable earnings," which means what is left of an employee's paycheck after deducting amounts legally required to be withheld, such as amounts for federal, state, or local income taxes; social security tax; and Medicare withholding.
How does the wage garnishment process operate in Kansas?
Once a creditor receives a judgment, it must wait 14 days before asking the court to issue a garnishment order. The garnishment order should state the creditor's name; the debtor's name; the amount of the creditor's original claim against the debtor; the amount of interest, court costs, and attorneys' fees awarded in the judgment; the rate of interest and date on which it began to accrue; and a statement that the creditor truthfully believes that some named person or entity, the "garnishee," is indebted to or has possession of property belonging to the debtor (this is where you come in).
The creditor is required to serve you with the garnishment order and the appropriate forms to file an answer to the order. The creditor must also provide notice of the garnishment to your employee.
An answer to a wage garnishment order must be substantially in compliance with the forms created by the Kansas Supreme Court. The garnishment answer must be completed in accordance with the instructions accompanying the answer form.
You must complete the answer form within 14 days after receiving the garnishment order. You must also send the answer to each creditor and employee listed on the answer form. Do not file the answer form with, or otherwise send it to, the court.
Within 14 days after you send the answer to the creditor and your employee, either the creditor or your employee may file a reply disputing any of the statements in your answer. If one of them does reply, the court will hold a hearing to resolve the disputed issues. If neither replies within the 14-day period, you must promptly pay the withheld wages directly to the garnishing creditor.
A garnishment order remains in effect until the judgment is paid or the garnishment is released by the court. Even though you don't receive a reminder, you must continue to comply with the garnishment order each pay period until the judgment is paid or the garnishment is released, whichever occurs first.
Although you must continue to comply each pay period, you do not need to send a new answer for each pay period. Instead, you should complete and retain a written explanation form for each pay period. You do not need to send the written explanation to the creditor or your employee unless specifically requested, but you must provide the completed explanation form within 14 days upon request. Thus, it is important for you to complete and retain such an explanation for every pay period during which you are under the garnishment order.
How much of the employee's wages can you withhold under a garnishment order?
Kansas's garnishment law provides that an employee must be left with enough money to live on. That law sets forth specific formulae for calculating that amount.
In Kansas, from an employee's disposable earnings for any given workweek, you may garnish no more than the lesser of:
- 25 percent of his disposable earnings for that week,
- the amount by which his disposable earnings that week exceed 30 times the federal minimum wage, or
- the creditor's claim in the garnishment order.
For example, assume that you have an employee working 40 hours per week and that the federal minimum wage is $10 per hour. Her earnings would equal $400. After all legally required deductions are made, assume that her disposable earnings equal $350. Now, you must go through each calculation to determine the formula that results in the lowest amount. That formula is the one you must use for that employee.
In our example, under the first calculation 25 percent of the employee's disposable earnings would be $87.50 ($350 x .25 = $87.50). Under the second calculation, 30 times $10 (the hypothetical minimum wage) would equal $300 and the employee's disposable earnings exceed that amount by $50.00. Thus, in this example, you could garnish the employee only up to $50.00 for the week, assuming that the creditor's claim in the garnishment equals or exceeds $50.00.
For most employees and most debts, 25 percent of their disposable earnings in a pay period will be available for garnishment.
Special rules in some circumstances
The above-discussed rules on permissible garnishment amounts do not apply to the following:
- court orders for child support or alimony,
- orders issued by a Chapter 13 bankruptcy court, or
- debts owed for state or federal taxes.
In the case of a garnishment for the support of an individual, you can garnish from an employee's disposable earnings for any given workweek no more than the following percentages:
- 50 percent of the disposable earnings for that week if the employee is supporting a spouse or child other than the spouse or child for whom the garnishment order was issued, or
- 60 percent of the disposable earnings for that week if the employee isn't supporting a spouse or child other than the spouse or child for whom the garnishment order was issued.
Note that if a support garnishment order is for a period that began more than 12 weeks before the beginning of the workweek for the wages at issue, the 50 percent and 60 percent stated above increase to 55 percent and 65 percent, respectively.
Kansas law also provides that if sickness of the employee or his family member prevents him from working for more than 2 weeks, and he provides an affidavit to that effect, the wage garnishment process may not be invoked against him until 2 months after recovery from the illness.
Do you have to respond to a garnishment order?
Yes. Inconvenience is not a legally sufficient reason for failing to comply with a garnishment order. An employer that does not answer a garnishment order is exposing itself to some of the most heavy-handed, draconian laws existing in Kansas.
Failure to answer a garnishment order can make the employer liable for the entire amount owed by the employee to the creditor. If that is not enough to catch your attention, you may also be liable for the creditor's expenses and attorneys' fees. In addition, the court may find you in contempt and impose civil sanctions.
You must answer a garnishment order even if you do not owe any wages to the employee. You must answer a garnishment order even if you no longer employ the employee. You must answer a garnishment order even if the judgment debtor never worked for you in the first place.
If you do not answer a garnishment, you risk having the above-stated penalties imposed. And remember that, as long as the debtor remains your employee, you must comply with the garnishment order each pay period until the judgment is paid or the garnishment order is released.
Can you charge a fee for each garnishment?
Kansas law allows you to charge employees for your actual cost in processing the garnishment order or for an administrative fee of $10 for each pay period during which you withhold income—whichever is less. The administrative fee cannot exceed $20 for each 30-day pay period.
Start with the assumption that the fee is in addition to the garnishment amount to be paid to the creditor. In other words, you take it out of the remaining wages that you would otherwise pay to the employee. That, however, could cause the amount to be withheld from the employee's paycheck to exceed the limits set by law. (Recall that Kansas limits the amount of an employee's disposable earnings that can be withheld from a paycheck in any workweek.) If that occurs, you are still allowed to charge the fee, but it must be deducted from the money that would otherwise be paid to the creditor.
What happens if you are served with multiple garnishment orders for the same employee?
Kansas statutes do not fully address this question. The instructions provided with the garnishment answer forms state that the disposable earnings subject to a garnishment order should be divided equally among the garnishing creditors. So, if there are two garnishing creditors, each gets one-half; if there are three garnishing creditors, each gets one-third; and so on. Note that this approach changes for garnishment orders that take precedent over general wage garnishments, such as garnishment orders for support, maintenance, or taxes. Again, failure to answer a garnishment order, withhold the appropriate wages, and pay the creditor may subject you to liability.
Can you fire employees for excessive garnishments?
No. Kansas law prohibits you from discharging an employee simply because a creditor has garnished the employee's wages. You also cannot refuse to hire an individual simply because she's burdened with a wage garnishment order.
Garnishing an employee's pay can be a complicated process. You need to establish a procedure for handling garnishments. The procedure can be as simple as having all garnishments routed immediately to a designated employee or your attorney for handling. Remember to keep copies of all documents and the check, as proof of your payment.
Finally, it is a good idea to seek legal advice before you go through with a garnishment, to make sure you are fully complying with the law. This article provides only a summary of some of the guidelines under Kansas's garnishment laws. Other state and federal laws exist that affect this area of employment law.