Wage Assignment


DEFINITION of 'Wage Assignment'

The procedure of taking money directly from an employee's compensation under the authority of a court order, in order to pay a debt obligation. Wage assignments are typically a last resort of a lender to receive repayment from a borrower who has previously failed to pay their debt obligation.

BREAKING DOWN 'Wage Assignment'

Typical reasons for a wage assignment may be items such child support payments, court fines and taxes that have gone unpaid for a prolonged period of time. Once mandated by a court and served to an employer, wage assignments are processed as part of an employer's payroll procedure -- the employee's regular paycheck is decreased by the amount of the assignment and noted on their pay stub.

Employees may sometimes be able to voluntarily undergo wage assignment to pay for things like union dues or contribute to a retirement fund.

  1. Withholding Allowance

    An allowance an individual claims on a W-4 Form. A withholding ...
  2. Assignment Method

    A method of allocating organizational resources. The assignment ...
  3. Creditor

    An entity (person or institution) that extends credit by giving ...
  4. Withholding

    The portion of an employee's wages that is not included in his ...
  5. Garnishment

    A legal process whereby payments towards a debt owed by an individual ...
  6. Withholding Tax

    1. Income tax withheld from employees' wages and paid directly ...
Related Articles
  1. Retirement

    Become A Certified Financial Divorce Analyst

    Use your financial knowledge to help people preserve their financial integrity after a failed marriage.
  2. Budgeting

    Get Through Divorce With Your Finances Intact

    Find out how to split your finances without coming up short.
  3. Fundamental Analysis

    The Basics Of Corporate Structure

    CEOs, CFOs, presidents and vice presidents: learn how to tell the difference.
  4. Professionals

    4 Ways Companies Can Relieve Workplace Stress

    Workplace stress can cost companies tons of money in lost productivity and absenteeism. Some of that is out of their control, but often they are the cause.
  5. Professionals

    Prevent Employees From Hacking You Computer System

    Cyber security attacks from a current or ex-employee can cause a lot of pain. Here is how to avoid such attacks.
  6. Entrepreneurship

    Hire Your Kids at Your Small Business – Here's Why

    And how to make sure you do it the right way, following IRS guidelines.
  7. Economics

    Explaining Silo Mentality

    A silo mentality occurs when certain departments in an organization do not share information or knowledge with other departments.
  8. Entrepreneurship

    What Does It Mean To Be Self-Employed?

    A self-employed individual works for herself instead of working for an employer that pays a salary or hourly wage.
  9. Savings

    5 Ways To Be Irreplaceable At Work

    Companies most value five certain behaviors, and the employees who exhibit them establish themselves as essential to an organization.
  10. Economics

    What is a Restricted Stock Unit (RSU)?

    RSUs are compensation in the form of stocks that an employer pays an employee according to a vesting schedule.
  1. What protections are in place for a whistleblower?

    Whistleblowers can play a critical role in ensuring the compliance, safety, honesty and legal fairness of governments and ... Read Full Answer >>
  2. How do modern companies assess business risk?

    Before a business can assess or mitigate business risk, it must first identify probable or likely risks to its bottom line. ... Read Full Answer >>
  3. Why has emphasis on corporate governance grown in the 21st century?

    Corporate governance refers to operational practices, management protocols, and other governing rules or principles by which ... Read Full Answer >>
  4. What should a whistleblower do if their employer retaliates?

    Although specifically prohibited by employment law, employer retaliation against whistleblowers for exposing employers' wrongdoings ... Read Full Answer >>
  5. What impact did the Sarbanes-Oxley Act have on corporate governance in the United ...

    After a prolonged period of corporate scandals involving large public companies from 2000 to 2002, the Sarbanes-Oxley Act ... Read Full Answer >>
  6. Why should investors research the C-suite executives of a company?

    C-suite executives are essential for creating and enacting overall firm strategy and are therefore an important aspect of ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Ex Works (EXW)

    An international trade term requiring the seller to make goods ready for pickup at his or her own place of business. All ...
  2. Letter of Intent - LOI

    A document outlining the terms of an agreement before it is finalized. LOIs are usually not legally binding in their entirety. ...
  3. Purchasing Power

    The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing ...
  4. Real Estate Investment Trust - REIT

    A REIT is a type of security that invests in real estate through property or mortgages and often trades on major exchanges ...
  5. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  6. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!