Earnings Withholding Order

DEFINITION of 'Earnings Withholding Order'

A legal document issued by a court stating that an employer is required to garnish an employee’s wages because a creditor has obtained a judgment against the employee. An earnings withholding order requires an employer to not pay an employee a portion of his or her earned wages and instead send that money to the levying officer, who will send it to the creditor that the money is owed to. In some jurisdictions, an earnings withholding order is called a wage garnishment order.

BREAKING DOWN 'Earnings Withholding Order'

An earnings withholding order will show the court’s name and address, the levying officer’s name and address and the employee’s attorney’s name and address (if the employee has an attorney). It will show the plaintiff or petitioner’s name, the defendant or respondent’s name and the court case number. The employer can use this information to contact the court and verify that the earnings withholding order is valid.

The order also shows the employer’s name and address, the date the employer received the order and the name and address of the employee whose wages the employer must garnish. The order states the total amount the employee owes under the judgment and tells the employer when to begin garnishing wages and how much to garnish from each paycheck. The employer must continue to garnish the employee’s wages until the judgment has been paid in full or until the levying officer sends the employer a notice of an earlier termination date.

The amount to be garnished depends on the employee’s disposable earnings, which is the pay the employee receives after all taxes have been subtracted from his or her pay. A chart then instructs the employer how much to garnish based on the state minimum wage and the employee’s disposable earnings. For example, in California in 2014, an employee with disposable earnings of less than $1,560 per month would not have any wages garnished, an employee with disposable earnings of $1,560.01 to $1,950 would have the excess of $1,560 garnished and an employee with disposable earnings of $1,950.01 or more per month would have 25% of disposable earnings garnished.