In most cases, a creditor can only garnish your paycheck after winning a lawsuit against you. However, certain creditors, including federal agencies, can garnish your wages without a judge's order.
A creditor garnishes a debtor's wages when it becomes concerned that the debtor won't pay her debt voluntarily. Wage garnishments, sometimes known as wage levies, require your employer to turn over part of your paychecks to your creditor until you satisfy the debt. A few states -- Pennsylvania, Texas, South Carolina and North Carolina -- do not permit wage garnishment unless the garnishment is to pay child support, student loans, taxes or other debts to a government agency.
Most types of consumer debt, such as credit card or medical debt, can't be collected via wage garnishment without a court order. The creditor must first win a judgment against you and then begin garnishment proceedings. You should receive written notice of your creditor's plan to garnish your earnings before your creditor actually begins the garnishment.
Administrative Wage Garnishment
Some types of debt do not require a lawsuit, or a court order, before wage garnishment begins. If you are in default on taxes or student loans, or owe money to a federal agency, such as the Social Security Administration, your wages can be garnished without a court order. You will, however, be notified in writing of the garnishment and offered the opportunity to request a hearing. During the hearing, you can explain why you think you don't owe the debt or explain that a wage garnishment would be a significant hardship for you and your family.
Under federal law, your employer cannot fire or discriminate against you because of one wage garnishment. However, if multiple creditors file garnishment orders against you, you could lose your job. If you are concerned about being hit with more than one wage garnishment, you may want to speak to a bankruptcy lawyer. The automatic stay of bankruptcy can stop wage garnishments, protecting you against conflict with your employer.