Administrative Wage Garnishment Procedures, 60797-60802 [2015-25427]

Agencies

• DEPARTMENT OF LABOR
• Office of the Secretary

[Federal Register Volume 80, Number 195 (Thursday, October 8, 2015)]
[Rules and Regulations]
[Pages 60797-60802]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-25427]


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DEPARTMENT OF LABOR

Office of the Secretary

29 CFR Part 20

RIN 1290-AA27


Administrative Wage Garnishment Procedures

AGENCY: Office of the Secretary, Labor.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule will allow the U.S. Department of Labor (Department) 
to garnish the disposable wages of non-federal workers who are indebted 
to the Department without first obtaining a court order. It implements 
the administrative wage garnishment provisions contained in the Debt 
Collection Improvement Act of 1996 (DCIA) in accordance with the 
regulations issued by the Secretary of the Treasury.

DATES: This rule is effective October 8, 2015. Comments must be 
received within 30 days of publication, which is on or before November 
9, 2015.

ADDRESSES: You may submit written comments to the docket using any one 
of the following methods:
    (1) Federal eRulemaking Portal: https://www.regulations.gov.
    (2) Mail: Address comments concerning this interim rule to Shelia 
Alexander, Office of Chief Financial Officer, U.S. Department of Labor, 
Frances Perkins Building, Room S4030, 200 Constitution Avenue NW., 
Washington, DC 20210.
    (3) Email: Comments may also be submitted by electronic mail to 
alexander.shelia@dol.gov.
    Additionally, any comments that concern information collection may 
be sent to the Office of Information and Regulatory Affairs, Attention 
OMB Desk Officer for DOL, Office of Management and Budget, Room 10235, 
New Executive Office Building, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT: Shelia Alexander, Office of the Chief 
Financial Officer, (202) 693-4472; or Rachel Rikleen, Office of the 
Solicitor, (202) 693-5702.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 31001(o) of the Debt Collection Improvement Act of 1996 
(DCIA), which is codified at 31 U.S.C. 3720D, authorizes federal 
agencies to use administrative procedure to garnish the disposable pay 
of an individual to collect delinquent non-tax debt owed to the United 
States in accordance with regulations promulgated by the Secretary of 
the Treasury. Wage garnishment is a process whereby an employer 
withholds amounts from an employee's wages and pays those amounts to 
the employee's creditor pursuant to a withholding order. Under the 
DCIA, agencies may garnish up to 15% of a delinquent non-tax debtor's 
disposable wages. Prior to the enactment of the DCIA, agencies were 
generally required to obtain a court

[[Page 60798]]

judgment before garnishing the wages of non-Federal employees.
    The DCIA requires the Secretary of the Treasury to issue 
regulations implementing the administrative wage garnishment 
requirements. These implementing regulations, which are at 31 CFR 
285.11, provide for due process for nontax debtors and require agencies 
to publish regulations for administrative wage garnishment hearings. 
Pursuant to 31 CFR 285.11(f), federal agencies must either prescribe 
regulations for the conduct of an administrative wage garnishment 
hearing consistent with the procedures set forth in section 285.11 or 
adopt section 285.11 without change by reference. Through this rule, 
the Department has decided to issue its own regulations consistent with 
the procedural requirements of section 285.11.
    This interim rule governs only administrative wage garnishment. 
Nothing in this regulation precludes the use of collection remedies not 
contained in the regulation. The Department and other federal agencies 
may simultaneously use multiple collection remedies to collect a debt, 
except as prohibited by law.
    The Department may, but is not required to, promulgate additional 
policies, procedures, and understandings consistent with this 
regulation and other applicable Federal laws, policies, and procedures, 
subject to the approval of the Department's Chief Financial Officer or 
their delegate. The Department does not intend for its components, 
agencies, and entities to be able to adopt different policies, 
procedures, or understandings.

II. Public Participation

    The Department is issuing this interim final rule to provide the 
public with an opportunity to comment. The Department must receive 
comments by the deadline stated above, which is no later than 30 days 
after this notice appears in the Federal Register.

III. Compliance With the Administraive Procedure Act; The Paperwork 
Reduction Act; The Regulatory Flexibility Act; The Unfunded Mandates 
Reform Act; and Executive Orders 12866, 12988, and 13132

    For purposes of the Administrative Procedure Act, 5 U.S.C. 551-559, 
this rule involves an agency procedure or practice, and therefore no 
notice of proposed rulemaking is required under section 553. 
Nonetheless, this is an interim rulemaking, with a provision for a 30-
day public comment period. The Department will review all comments 
received during the comment period and will consider any modifications 
that appear appropriate in adopting these rules as final.
    The Department has determined that this rule contains no collection 
of information subject to the Paperwork Reduction Act, 44 U.S.C. 3501-
3521. However, the Department specifically invites comments on this 
determination. In addition to having an opportunity to file comments 
with the Department, comments about the paperwork implications of the 
proposed regulations may be addressed to the Office of Management and 
Budget (OMB). Comments to the OMB should be directed to: Office of 
Information and Regulatory Affairs, Attention OMB Desk Officer for the 
DOL, Office of Management and Budget, Room 10235, Washington, DC 20503; 
Telephone: 202-395-7316/Fax: 202-395-6974 (these are not toll-free 
numbers). You can also submit comments to the OMB by email at 
OIRA_submission@omb.eop.gov. The OMB will consider all written comments 
that agency receives within 30 days of publication of this rule. 
(Commenters are encouraged, but not required, to send a courtesy copy 
of any comments submitted to the OMB regarding the information 
collections by mail or courier to: U.S. Department of Labor-OASAM, 
Office of the Chief Information Officer, Attn: Departmental Information 
Compliance Management Program, Room N1301, 200 Constitution Avenue NW., 
Washington, DC 20210; or by email: DOL_PRA_PUBLIC@dol.gov.) As 
previously indicated, written comments directed to the Department may 
be submitted within 30 days of publication of this notice. Should a 
commenter believe this rule contains a covered information collection, 
then the Department and OMB seek comments that:
    (1) Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden of 
the proposed collection of information, including the validity of the 
methodology and assumptions used;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of information on those 
who are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires 
administrative agencies to consider the effect of their actions on 
small entities, including small businesses. Because no notice of 
proposed rulemaking is required for procedural rules, the requirements 
of the RFA pertaining to regulatory flexibility analysis do not apply. 
However, even if the RFA were to apply, the Department certifies that 
this interim rule will not have a significant impact on a substantial 
number of small entities. Although the employer of a delinquent debtor 
would have to certify certain information about the debtor such as the 
debtor's employment status and earnings, that information is normally 
in the employer's payroll records. It would not take a significant 
amount of time or result in a significant cost for an employer to make 
this certification. An employer is not required to vary its normal pay 
cycle to comply with a garnishment order issued under these 
regulations.
    For purposes of the Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 
1501-1516, the Department has determined that the rule contains no 
Federal mandates, as defined in Title II of UMRA. Therefore the rule is 
not subject to the requirements of section 202 and 205 of UMRA.
    Executive Orders 12866 and 12988 require that each agency write 
regulations that are easy to understand and specify how individual 
civil litigation rights will be affected. The Department has determined 
that this rule is drafted, to the extent practicable, under the 
standards established in those orders. However, the Secretary invites 
comments on how to make these proposed regulations easier to 
understand.
    Executive Order 13132 requires us to ensure meaningful and timely 
input by state and local elected officials in the development of 
regulatory policies that have federalism implications. The interim rule 
does not have substantial direct effects on the States, on the 
relationship between the National Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.

IV. Summary of Key Aspects of the Rule

    This rule applies to debts owed to the Department or in connection 
with any program administered by the Department. The administrative 
wage garnishment process will be applied consistently throughout the 
Department.

[[Page 60799]]

    The Department can enter into agreements, such as memoranda of 
understanding, with other Federal agencies permitting that agency to 
administer part or all of the Department's administrative wage 
garnishment process. Nothing in this regulation requires the Department 
to duplicate notices or administrative proceedings required by 
contract, this regulation, or other laws or regulations. Thus, for 
example, the Department is not required to provide a debtor with two 
hearings on the same issue merely because two different collection 
tools are used, each of which requires that the debtor be provided with 
a hearing.
    Section 20.205 lists the notice requirements, which includes an 
explanation of the debtor's rights. The debtor is allowed to inspect 
Department records related to the debt, enter into a written repayment 
agreement, and have a hearing. A debtor can request one of two types of 
available hearings--a paper hearing or an oral hearing. The format of 
oral hearings is not limited to in-person and telephone hearings and 
may include new forms of technology. The hearing official has the 
authority to determine the kind of hearing and the amount of time 
allotted each hearing.
    If a hearing is held, the Department can meet its initial burden by 
offering documentation, including a copy of the debt adjudication, 
which demonstrates the existence of the debt and its amount. Once the 
Department has established its prima facie case, the debtor can dispute 
the existence or amount of the debt. For example, the debtor can meet 
his or her burden by demonstrating that he or she is not the person who 
owes a debt to the Department, that he or she has not received payments 
from the Department or has not been fined by the Department, or that he 
or she has already paid the debt.
    Additionally, the Federal Employees Compensation Act (FECA), 5 
U.S.C. 8101-8193, contains a provision that precludes administrative 
and judicial review of agency determinations, which normally includes a 
repayment schedule. As a result, for hearings related to FECA debts, 
once the Department has made its prima facie case, the debtor has only 
two limited grounds on which he or she can demonstrate that an 
administrative wage garnishment is not appropriate. The debtor may not 
challenge the underlying merits of the determination that created the 
debt.
    Section 20.209 describes how much the Department can withhold 
through administrative wage garnishment, which is up to 15%, and the 
employer's administrative wage garnishment duties. A withholding order 
for family support would always have priority over an administrative 
wage garnishment order. If there are multiple federal garnishment 
orders, priority depends on which garnishment order was first obtained. 
When a debtor's disposable pay is already subject to one or more 
withholding orders with higher or equal priority with the Department's 
administrative wage garnishment order, the amount that the employer 
must withhold and remit to the Department would not be more than an 
amount calculated by subtracting the amount(s) withheld under the other 
withholding order(s) from 25% of the debtor's disposable pay. For 
example, if the employer is withholding 20% of a debtor's disposable 
pay for a family support or prior withholding order, the amount 
withheld for the subsequent withholding order issued under this section 
is limited to 5% of the debtor's disposable pay. When the family 
support or prior withholding order terminates, the amount withheld for 
the subsequent withholding order issued under this section may be 
increased to 15%.

List of Subjects in 29 CFR Part 20

    Administrative wage garnishment, debt collection, Labor.

    Signed at Washington, DC, on this 29th day of September, 2015.
Thomas E. Perez,
U.S. Secretary of Labor.

    For the reasons set forth in the preamble, the Department of Labor 
amends part 20 of title 29 of the Code of Federal Regulations as 
follows:

PART 20--FEDERAL CLAIMS COLLECTION

0
1. The authority citation for part 20 is revised to read as follows:

    Authority: 31 U.S.C. 3711 et seq.; Subpart D is also issued 
under 5 U.S.C. 5514; Subpart E is also issued under 31 U.S.C. 3720A; 
Subpart F is also issued under 31 U.S.C. 3720D.


0
2. Add subpart F to read as follows:

Subpart F--Administrative Wage Garnishment

Sec.
20.201 Purpose.
20.202 Scope.
20.203 Definitions.
20.204 General rule.
20.205 Notice requirements.
20.206 Hearing.
20.207 Wage garnishment order.
20.208 Certification by employer.
20.209 Amounts withheld.
20.210 Exclusions from garnishment.
20.211 Financial hardship.
20.212 Ending garnishment.
20.213 Actions prohibited by employer.
20.214 Refunds.
20.215 Right of Action.


Sec.  20.201  Purpose.

    This section provides procedures the U.S. Department of Labor may 
use to collect money from a debtor's disposable pay by means of 
administrative wage garnishment to satisfy delinquent nontax debt owed 
to the Department. In accordance with the procedures set forth in 31 
U.S.C. 3720D and 31 CFR 285.11, the Department may request that a non-
Federal employer garnish the disposable pay of an individual to collect 
delinquent non-tax debt owed to the Department or in connection with 
any program administered by the Department.


Sec.  20.202  Scope.

    (a) This subpart applies to any non-tax debt owed to the U.S. 
Department of Labor or in connection with any program administered by 
the Department and to any entity that pursues recovery of such debt. 
The Department can enter into arrangements with other federal agencies 
to carry out its responsibilities under this part.
    (b) This subpart shall apply notwithstanding any provision of State 
law.
    (c) Nothing in this subpart precludes the compromise of a debt or 
the suspension or termination of a collection action in accordance with 
applicable law. See, for example, the Federal Claims Collection 
Standards (FCCS), 31 CFR parts 900-904.
    (d) The receipt of payments pursuant to this subpart does not 
preclude the Department from pursuing other debt collection remedies 
separately or in conjunction with administrative wage garnishment, 
including the offset of Federal payments, to satisfy delinquent nontax 
debt owed to the Department.
    (e) This subpart does not apply to the collection of delinquent 
nontax debt owed to the United States from the wages of Federal 
employees from their Federal employment. Federal pay is subject to the 
Federal salary offset procedures set forth in 5 U.S.C. 5514 and other 
applicable laws.
    (f) Nothing in this subpart requires the Department to duplicate 
notices or administrative proceedings required by contract, this 
subpart, or other laws, regulations, or procedures.


Sec.  20.203  Definitions.

    As used in this section the following definitions shall apply:
    (a) The term business day means Monday through Friday, not 
including Federal legal holidays. For purposes of

[[Page 60800]]

computation, the last day of the period will be included unless it is a 
Federal legal holiday.
    (b) The term day means calendar day. For purposes of computation, 
the last day of the period will be included unless it is a Saturday, a 
Sunday, or a Federal legal holiday.
    (c) The term debt or claim means any amount of money, funds or 
property that has been determined by an appropriate official of the 
Federal Government to be owed to the Department by an individual, 
including debt administered by a third party as an agent for the 
Federal Government.
    (d) The term debtor means an individual who owes a delinquent 
nontax debt to the Department.
    (e) The term delinquent nontax debt means any nontax debt that has 
not been paid by the date specified in the initial written demand for 
payment, or applicable agreement, unless other satisfactory payment 
arrangements have been made. For purposes of this section, the terms 
``debt'' and ``claim'' are synonymous and refer to delinquent nontax 
debt.
    (f) The term Department means the United States Department of 
Labor.
    (g) The term disposable pay means that part of the debtor's 
compensation (including, but not limited to, salary, bonuses, 
commissions, and vacation pay) from an employer remaining after the 
deduction of health insurance premiums and any amounts required by law 
to be withheld. For purposes of this subpart, ``amounts required by law 
to be withheld'' include amounts for deductions such as social security 
taxes and withholding taxes but do not include any amount withheld 
pursuant to a court order.
    (h) The term employer means a person or entity that employs the 
services of others and that pays their wages or salaries. The term 
employer includes, but is not limited to, State and local Governments 
but does not include an agency of the Federal Government.
    (i) The term evidence of service means information retained by the 
Department indicating the nature of the document to which it pertains, 
the date of mailing of the document, and to whom the document is being 
sent. Evidence of service may be retained electronically so long as the 
manner of retention is sufficient for evidentiary purposes.
    (j) The term garnishment means the process of withholding amounts 
from an employee's disposable pay and the paying of those amounts to a 
creditor in satisfaction of a withholding order.
    (k) The term hearing official means any qualified individual, as 
determined by the Department.
    (l) The term withholding order means any order for withholding or 
garnishment of pay issued by the Department. For purposes of this 
section, the terms ``wage garnishment order'' and ``garnishment order'' 
have the same meaning as ``withholding order.''


Sec.  20.204  General rule.

    Whenever the Department determines that a delinquent debt is owed 
by an individual, to the Department or in connection with any program 
administered by the Department, the Department may initiate proceedings 
administratively to garnish the wages of the delinquent debtor.


Sec.  20.205  Notice requirements.

    (a) At least 30 days before the initiation of garnishment 
proceedings, the Department shall mail, by first class mail to the 
debtor's last known address a written notice informing the debtor of:
    (1) The nature and amount of the debt;
    (2) The intention of the Department to initiate proceedings to 
collect the debt through deductions from pay until the debt and all 
accumulated interest, penalties and administrative costs are paid in 
full; and
    (3) An explanation of the debtor's rights, including those set 
forth in paragraph (b) of this section, and the time frame within which 
the debtor may exercise his or her rights.
    (b) The debtor shall be afforded the opportunity:
    (1) To inspect and copy the Department's records related to the 
debt;
    (2) To enter into a written repayment agreement with the Department 
under terms agreeable to the Department; and
    (3) For a hearing in accordance with Sec.  20.206 before a hearing 
official. The debtor is not entitled to a hearing concerning the terms 
of the proposed repayment schedule if these terms have been established 
by written agreement under 20.206(b)(2).
    (c) The Department will retain evidence of service indicating the 
date of mailing of the notice.


Sec.  20.206  Hearing.

    (a) Request for hearing. If the debtor submits a written request 
for a hearing concerning the existence or amount of the debt or the 
terms of the repayment schedule, the Department shall provide a written 
or oral hearing in accordance with 31 CFR 285.11(f) before a hearing 
official.
    (b) Type of hearing or review. (1) For purposes of this subpart, 
whenever the Department is required to afford a debtor a hearing, the 
Department shall provide the debtor with a reasonable opportunity for 
an oral hearing when the hearing official determines that the issues in 
dispute cannot be resolved by review of the documentary evidence, for 
example, when the validity of the claim turns on the issue of 
credibility or veracity.
    (2) If a hearing official determines that an oral hearing is 
appropriate, the time and location of the hearing, including the amount 
of time allotted for the hearing, shall be at the discretion of the 
hearing official. An oral hearing may, at the discretion of the hearing 
official, be conducted either in-person, by telephone conference, or by 
other electronic means. All travel expenses incurred by the debtor in 
connection with an in-person hearing will be borne by the debtor. All 
charges incurred during the hearing as a result of the use of telephone 
conference or other electronic means will be the responsibility of the 
Department.
    (3) In those cases when an oral hearing is not required by this 
section, a hearing official shall nevertheless accord the debtor a 
``paper hearing,'' that is, a hearing official will decide the issues 
in dispute based upon a review of the written record. The hearing 
official will establish a reasonable deadline for the submission of 
evidence.
    (c) Effect of timely request. Subject to Sec.  20.206(k), if the 
debtor's written request is received by the Department on or before the 
15th business day following the mailing of the notice described in 
Sec.  20.205(a), the Department shall not issue a withholding order 
under Sec.  20.207 until the debtor has been provided the requested 
hearing and a decision in accordance with paragraphs (h) and (i) of 
this section has been rendered.
    (d) Failure to timely request a hearing. If the debtor's written 
request is received by the Department after the 15th business day 
following the mailing of the notice described in Sec.  20.205(a), the 
Department shall provide the debtor with a hearing before a hearing 
official. However, the Department will not delay issuance of a 
withholding order unless the Department determines that the delay in 
filing the request was caused by factors beyond the debtor's control or 
the Department receives information that the Department believes 
justifies a delay or cancellation of the withholding order.
    (e) Procedure. After the debtor requests a hearing, the hearing 
official shall notify the debtor of:
    (1) The date and time of a hearing conducted by telephone 
conference or other electronic means;

[[Page 60801]]

    (2) The date, time, and location of an in-person oral hearing; or
    (3) The deadline for the submission of evidence for a written 
hearing.
    (f) Burden of proof. (1) The agency will have the burden of going 
forward to prove the existence or amount of the debt. The Department 
can satisfy this burden by submitting a certified copy of the 
adjudication or other document that establishes the existence of the 
debt and the amount of the debt.
    (2) Thereafter, if the debtor disputes the existence or amount of 
the debt, the debtor must show by a preponderance of the evidence that 
no debt exists or that the amount of the debt is incorrect. In 
addition, the debtor may present evidence that:
    (i) The terms of the repayment schedule are unlawful;
    (ii) The terms would cause a financial hardship to the debtor; or
    (iii) The collection of the debt may not be pursued due to 
operation of law.
    (3) Debts that arise under the Federal Employees Compensation Act, 
5 U.S.C. 8101-8193, are subject to preclusion of administrative and 
judicial review, as described at 5 U.S.C. 8128(b). As a result, once 
the Department meets its burden of showing the existence and amount of 
a debt under this statute, the debtor must prove by a preponderance of 
the evidence that:
    (i) The documentation put forward by the agency to establish the 
debt was not authentic; or
    (ii) The debt was incurred by someone other than the debtor as a 
result of identity theft.
    (g) Record. The hearing official must maintain a summary record of 
any hearing provided under this section.
    (h) Hearing procedure. A hearing is an informal process and the 
hearing official is not bound by common law or statutory rules of 
evidence or by technical or formal rules of procedure. However, 
witnesses who testify in oral hearings must do so under affirmation, so 
that 18 U.S.C. 1001 applies.
    (i) Date of decision. The hearing official shall issue a written 
opinion stating his or her decision, as soon as practicable, but not 
later than 60 days after the date on which the request for such hearing 
was received. If a hearing official is unable to provide the debtor 
with a hearing and render a decision within 60 days after the receipt 
of the request for such hearing:
    (1) The Department may not issue a withholding order until the 
hearing is held and a decision rendered; or
    (2) If the Department had previously issued a withholding order to 
the debtor's employer, the Department must suspend the withholding 
order beginning on the 61st day after the receipt of the hearing 
request and continuing until a hearing is held and a decision is 
rendered.
    (j) Content of decision. The written decision shall include:
    (1) A summary of the facts presented;
    (2) The hearing official's findings, analysis, and conclusions; and
    (3) The terms of any repayment schedules, if applicable.
    (k) Final agency action. The hearing official's decision will be 
the final agency action for the purposes of judicial review under the 
Administrative Procedure Act, 5 U.S.C. 701-706.
    (l) Failure to appear. In the absence of good cause shown to the 
hearing official, a debtor who fails to appear at a hearing scheduled 
pursuant to this section will be deemed as not having timely filed a 
request for a hearing.


Sec.  20.207  Wage garnishment order.

    (a) Unless the Department receives information that the Department 
believes justifies a delay or cancellation of the withholding order, 
the Department shall send, by first class mail, a withholding order to 
the debtor's employer:
    (1) Within 30 days after the debtor fails to make a timely request 
for a hearing (i.e., within 15 business days after the mailing of the 
notice described in Sec.  20.205(a), or,
    (2) If a timely request for a hearing is made by the debtor, within 
30 days after a final decision is made by the hearing official, or,
    (3) As soon as reasonably possible thereafter.
    (b) The withholding order sent to the employer under paragraph (a) 
of this section shall be in the form prescribed by the Secretary of the 
Treasury. The withholding order shall contain the signature of, or the 
image of the signature of, the Secretary of Labor or his or her 
delegatee. The order shall contain only the information necessary for 
the employer to comply with the withholding order. Such information 
includes the debtor's name, address, and Employee Identification 
Number, as well as instructions for withholding and information as to 
where payments should be sent.
    (c) The Department will retain evidence of service indicating the 
date of mailing of the order.


Sec.  20.208  Certification by employer.

    Along with the withholding order, the agency shall send to the 
employer a certification in the form prescribed by the Secretary of the 
Treasury. The employer shall complete and return the certification to 
the Department within the time frame prescribed in the instructions to 
the form. The certification will address matters such as information 
about the debtor's employment status and disposable pay available for 
withholding.


Sec.  20.209  Amounts withheld.

    (a) After an employer receives a garnishment order, the employer 
must deduct from all disposable pay paid to the applicable debtor 
during each pay period the amount of garnishment described in paragraph 
(b) of this section.
    (b) Subject to the provisions in paragraphs (c) and (d) of this 
section, the amount of garnishment shall be the lesser of:
    (1) The amount indicated on the garnishment order up to 15 percent 
of the debtor's disposable pay; or
    (2) The amount set forth in 15 U.S.C. 1673(a)(2) (Restriction on 
Garnishment). The amount set forth at 15 U.S.C. 1673(a)(2) is the 
amount by which a debtor's disposable pay exceeds an amount equivalent 
to thirty times the minimum wage. See 29 CFR 870.10.
    (c) When a debtor's pay is subject to withholding orders with 
priority the following shall apply:
    (1) Unless otherwise provided by Federal law, withholding orders 
issued under this subpart shall be paid in the amounts set forth under 
paragraph (b) of this section and shall have priority over other 
withholding orders which are served later in time. However, withholding 
orders for family support shall have priority over withholding orders 
issued under this subpart.
    (2) If amounts are being withheld from a debtor's pay pursuant to a 
withholding order served on an employer before a withholding order 
issued pursuant to this subpart, or if a withholding order for family 
support is served on an employer at any time, the amounts withheld 
pursuant to the withholding order issued under this subpart shall be 
the lesser of:
    (i) The amount calculated under paragraph (b) of this section, or
    (ii) An amount equal to 25 percent of the debtor's disposable pay 
less the amount(s) withheld under the withholding order(s) with 
priority.
    (3) If a debtor owes more than one debt to the Department, the 
Department may issue multiple withholding orders provided that the 
total amount garnished from the debtor's pay for such orders does not 
exceed the amount set forth in paragraph (b) of this section.
    (d) An amount greater than that set forth in paragraphs (b) and (c) 
of this

[[Page 60802]]

section may be withheld upon the written consent of the debtor.
    (e) The employer shall promptly pay to the Department all amounts 
withheld in accordance with the withholding order issued pursuant to 
this subpart.
    (f) An employer shall not be required to vary its normal pay and 
disbursement cycles in order to comply with the withholding order.
    (g) Any assignment or allotment by an employee of his earnings 
shall be void to the extent it interferes with or prohibits execution 
of the withholding order issued under this subpart, except for any 
assignment or allotment made pursuant to a family support judgment or 
earlier withholding order.
    (h) The employer shall withhold the appropriate amount from the 
debtor's wages for each pay period until the employer receives 
notification from the Department to discontinue wage withholding. The 
garnishment order shall indicate a reasonable period of time within 
which the employer is required to commence wage withholding.


Sec.  20.210  Exclusions from garnishment.

    The Department may not garnish the wages of a debtor who it knows 
has been involuntarily separated from employment until the debtor has 
been reemployed continuously for at least 12 months. The debtor has the 
burden of informing the Department (or any other federal agency 
exercising the Department's authority under this subpart) of the 
circumstances surrounding an involuntary separation from employment.


Sec.  20.211  Financial hardship.

    (a) A debtor whose wages are subject to a wage withholding order 
under this subpart, may, at any time, request a review by the 
Department of the amount garnished, based on materially changed 
circumstances such as disability, divorce, or catastrophic illness 
which result in financial hardship.
    (b) A debtor requesting a review under paragraph (a) of this 
section shall submit the basis for claiming that the current amount of 
garnishment results in a financial hardship to the debtor, along with 
supporting documentation. The Department shall consider any information 
submitted in accordance with procedures and standards established by 
the agency.
    (c) If a financial hardship is found, the Department shall 
downwardly and temporarily adjust the amount garnished to reflect the 
debtor's financial condition. The Department will notify the employer 
of any adjustments to the amounts to be withheld.


Sec.  20.212  Ending garnishment.

    (a) Once the Department has fully recovered the amounts owed by the 
debtor, including interest, penalties, and administrative costs 
consistent with the FCCS, the Department shall send the debtor's 
employer notification to discontinue wage withholding.
    (b) At least annually, the Department shall review its debtors' 
accounts to ensure that garnishment has been terminated for accounts 
that have been paid in full.


Sec.  20.213  Actions prohibited by employer.

    An employer may not discharge, refuse to employ, or take 
disciplinary action against the debtor due to the issuance of a 
withholding order under this subpart.


Sec.  20.214  Refunds.

    (a) If a hearing official, at a hearing held pursuant to Sec.  
20.206, determines that a debt is not legally due and owing to the 
Department, the Department shall promptly refund any amount collected 
by means of administrative wage garnishment.
    (b) Unless required by Federal law or contract, refunds under this 
section shall not bear interest.


Sec.  20.215  Right of action.

    The Department may sue any employer for any amount that the 
employer fails to withhold from wages owed and payable to an employee 
in accordance with Sec. Sec.  20.207 and 20.209. However, a suit may 
not be filed before the termination of the collection action involving 
a particular debtor, unless earlier filing is necessary to avoid 
expiration of any applicable statute of limitations period. For 
purposes of this subpart, ``termination of the collection action'' 
occurs when the agency has terminated collection action in accordance 
with the FCCS or other applicable standards. In any event, termination 
of the collection action will have been deemed to occur if the agency 
has not received any payments to satisfy the debt from the particular 
debtor whose wages were subject to garnishment, in whole or in part, 
for a period of 1 year.

[FR Doc. 2015-25427 Filed 10-7-15; 8:45 am]
BILLING CODE 4510-7C-P