(a) Statutory provison. Section 303 (a) of the CCPA provides that,
with some exceptions,
the maximum part of the aggregate disposable earnings of an individual
for any workweek which is subjected to garnishment may not exceed
(1) 25 per centum of his disposable earnings for that week, or
(2) the amount by which his disposable earnings for that week exceed
thirty times the Federal minimum hourly wage prescribed by section
6(a)(1) of the Fair Labor Standards Act of 1938, in effect at the time
the earnings are payable.
whichever is less. In the case of earnings for any pay period other than
a week, the Secretary of Labor shall by regulation prescribe a multiple
of the Federal minimum hourly wage equivalent in effect to that set
forth in paragraph (2).
(b) Weekly pay period. The statutory exemption formula applies
directly to the aggregate disposable earnings paid or payable for a pay
period of 1 workweek, or a lesser period. Its intent is to protect from
garnishment and save to an individual earner the specified amount of
compensation for his personal services rendered in the workweek, or a
lesser period. Thus:
(1) The amount of an individual's disposable earnings for a workweek
or lesser period which may not be garnished is 30 times the Fair Labor
Standards Act minimum wage. If an individual's disposable earnings for
such a period are equal to or less than 30 times the minimum wage, the
individual's earnings may not be garnished in any amount. (When the
minimum wage increases, the proportionate amount of earnings which may
not be garnished also increases.) On April 1, 1991, the minimum wage
increased to $4.25. Accordingly, the amount of disposable weekly
earnings which may not be garnished is $127.50 effective April 1, 1991.
(For the period April 1, 1990 through March 31, 1991, the amount that
may not be garnished is $114 (30 x $3.80).)
(2) For earnings payable on or after April 1, 1991, if an
individual's disposable earnings for a workweek or lesser period are
more than $127.50, but less than $170.00, only the amount above $127.50
is subject to garnishment. (For earnings payable during the period April
1, 1990, through March 31, 1991, when the Fair Labor Standards Act
minimum wage was $3.80, this range computes to more than $114.00, but
less than $152.00.)
(3) For earnings payable on or after April 1, 1991, if an
individual's disposable earnings for a workweek or lesser period are
$170.00 or more, 25 percent of his/her disposable earnings is subject to
garnishment. (The weekly figure was $152.00 (40 x $3.80) for the period
April 1, 1990 through March 31, 1991.)
(c) Pay for a period longer than 1 week. In the case of disposable
earnings which compensate for personal services rendered in a pay period
longer than 1 workweek, the weekly statutory exemption formula must be
transformed to a formula applicable to such earnings providing
equivalent restrictions on wage garnishment.
(1) The 25 percent part of the formula would apply to the aggregate
disposable earnings for all the workweeks or fractions thereof
compensated by the pay for such pay period.
(2) The following formula should be used to calculate the dollar
amount of disposable earnings which would not be subject to garnishment:
The number of workweeks, or fractions thereof, should be multiplied
times the applicable Federal minimum wage and that amount should be
multiplied by 30. For example, for the period April 1, 1990 through
March 31, 1991 when the Federal minimum wage was $3.80 per hour, the
formula should be calculated based on a minimum wage of $3.80 ($3.80
multiplied by 30 equals $114; $114 multiplied by the number of workweeks
(or fractions thereof) equals the amount that cannot be garnished). As
of April 1, 1991, the $4.25 Federal minimum wage replaces $3.80 in the
formula (and the amount which cannot be garnished would then be $127.50
multiplied by the number of workweeks (or fractions thereof)). For
purposes of this formula, a calendar month is considered to consist of
4\1/3\ workweeks. Thus, during the period April 1, 1990 through March
31, 1991 when the Federal minimum hourly wage was $3.80 an hour, the
amount of disposable earnings for a 2-week period is $228.00
(2 x 30 x $3.80); for a monthly period, $494.00 (4\1/3\ x 30 x $3.80).
Effective April 1, 1991, such amounts increased as follows: for a two-
week period, $255.00 (2 x 30 x $4.25); for a monthly period, $552.50
(4\1/3\ x 30 x $4.25). The amount of disposable earnings for any other
pay period longer than 1 week shall be computed in a manner consistent
with section 303(a) of the act and with this paragraph.
(3) Absent any changes to the rate set forth in section 6(a)(1) of
the Fair Labor Standards Act, disposable earnings for individuals paid
weekly, biweekly, semimonthly, and monthly may not be garnished unless
they are in excess of the following amounts:
----------------------------------------------------------------------------------------------------------------
Semi-
Date Minimum Weekly Biweekly monthly Monthly
amount amount amount amount rate
----------------------------------------------------------------------------------------------------------------
Jan. 1, 1981................................... $3.35 $100.50 $201.00 $217.75 $435.50
Apr. 1, 1990................................... 3.80 114.00 228.00 247.00 494.00
Apr. 1, 1991................................... 4.25 127.50 255.00 276.25 552.50
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(4) Absent any changes to the rate set forth in section 6(a)(1) of
the Fair Labor Standards Act, if the disposable earnings are less than
the following figures, only the difference between the appropriate
figures set forth in paragraph (c)(3) of this section and the
individual's disposable earnings may be garnished.
----------------------------------------------------------------------------------------------------------------
Semi-
Date Minimum Weekly Biweekly monthly Monthly
amount amount amount amount rate
----------------------------------------------------------------------------------------------------------------
Jan. 1, 1981................................... $3.35 $134.00 $268.00 $290.33 $580.67
Apr. 1, 1990................................... 3.80 152.00 304.00 329.33 658.67
Apr. 1, 1991................................... 4.25 170.00 340.00 368.33 736.67
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For example, in April of 1990, if an individual's disposable
earnings for a biweekly pay period are $274.00, the difference between
$228.00 and $274.00 (i.e., $46.00) may be garnished.
(5) If disposable earnings are in excess of the figures stated in
paragraph (c)(4) of this section, 25% of the disposable earnings may be
garnished.
(d) Date wages paid or payable controlling. The date that disposable
earnings are paid or payable, and not the date the Court issues the
garnishment order, is controlling in determining the amount of
disposable earnings that may be garnished. Thus, a garnishment order in
November 1990, providing for withholding from wages over a period of
time, based on exemptions computed at the $3.80 per hour minimum wage
then in effect, would be modified by operation of the change in the law
so that wages paid after April 1, 1991, are subject to garnishment to
the extent described in paragraphs (b) and (c) of this section on the
basis of a minimum rate of $4.25 per hour. This principle is applicable
at the time of the enactment of any further increase in the minimum
wage.
(Sec. 2, Pub. L. 93-259, 84 Stat 55)
[35 FR 8226, May 26, 1970, as amended at 40 FR 52610, Nov. 11, 1975; 43
FR 28471, June 30, 1978; 43 FR 30276, July 14, 1978; 44 FR 30685, May
29, 1979; 56 FR 32254, July 15, 1991; 56 FR 40660, Aug. 15, 1991]
