The Basic Rule
10% of your gross earnings will be deducted subject to a minimum wage analysis explained below. Gross earnings are defined as salary, wages, overtime earnings, commissions, income from trusts, before any deductions are made from such income.
Limitations of Garnishments based on Minimum Wage
Under New York law, the garnishment will kick in only if your weekly disposable earnings income reaches or exceeds $217.50.
Disposable earnings are defined as those weekly earnings left after deducting those amounts required by law to be withheld (for example, taxes, social security, and unemployment insurance, but not deductions for union dues, insurance plans, etc.).
Also, no garnishment can take more than 25% of your weekly disposable earnings.
So, really, the basic rule is that wages subject to deduction are the lesser of
- 25% of disposal earnings; or
- 10% of gross earnings.
By the way, here is a summary of CPLR § 5231.
How Much of My Wages Can Be Garnished for Private Debts in New York?
The percentage of your earnings that may be deducted for personal liabilities, such as credit card balances, medical invoices, bank loans, and private educational loans, hinges on your disposable income. It's important to distinguish personal debts from other types of obligations like child support, taxes, or government student loans.
- If you're making $450.00* or less per week after tax: All of your earnings are protected from debt recovery processes. In simpler terms, no garnishments can be applied to your wages.
- If your weekly after-tax income surpasses $450.00*: Creditors have the right to deduct the smaller amount between 10% of your gross earnings or 25% of your disposable weekly income. However, it's key to remember that creditors are not allowed to bring your disposable weekly earnings below $450.00.
*This particular sum is based on the $15/hour minimum wage in New York State for “NYC – Large Employers (of 11 or more)” as of 12/31/18, as outlined on the website of the NYS Department of Labor. However, this sum might fluctuate depending on the particular minimum wage that applies to your situation, taking into account your place of work and your employer.
If garnishments are already in place for obligations like child support or spousal maintenance: Even with these pre-existing garnishments, your earnings can further be deducted to service a personal debt. However, the sum total of all garnishments can't exceed 25% of your after-tax income.
Exploring CPLR 5231: Five Key Aspects of Wage Garnishment Rules in New York
- As per N.Y. C.P.L.R. 5231, a judgment debtor with income is subject to an income execution, but deductions should not surpass 10% of the income (N.Y. C.P.L.R. 5231 (b)).
- No portion will be deducted from a debtor's weekly income unless the disposable income crosses 30 times the federal or state minimum wage, prioritizing the higher of the two (N.Y. C.P.L.R. 5231 (b)(i)).
- The weekly deduction from the debtor's income must not exceed either 25% of disposable income or the amount that exceeds 30 times the minimum wage, with the lesser of the two being taken (N.Y. C.P.L.R. 5231 (b)(ii)).
- If a debtor's earnings have existing alimony or support deductions, the garnished amount cannot exceed the difference between 25% of the disposable income for the week and the alimony/support deductions (N.Y. C.P.L.R. 5231 (b)(iii)).
- As per N.Y. C.P.L.R. 5231(c), "earnings" refers to compensation for personal services, whereas "disposable earnings" refers to the leftover earnings after mandatory deductions.
Additional Limitations for Pre-existing Court Orders for Child Support, Alimony, Maintenance, or Family Support
If any such court order already consumes 25% or more of your disposal earnings, the income execution will not take effect. But the burden is on you to notify the marshal within that 20-day grace period to avoid having the garnishment served on your employer. If the execution is sent to your employer, it is supposed to honor these garnishment laws.
If any such court order consumes less than 25% of your disposal earnings, then the income execution, added together with such pre-existing order, cannot exceed 25% of your disposal earnings.
If this breakdown is not clear, call us, and let's talk it through.
Other Avenues to Overturn the Judgment or Limit its Scope
The income execution should also notify you of your legal right to request a court to deny, limit, condition, regulate, or extend the use of the execution. But you should also heavily consider attacking the judgment itself to vacate the entire execution all together. We do this repeatedly. You need to know all of your rights to place you in the best legal position. Do not assume that your adversary possesses an unassailable judgment. For example, New York law requires that you be properly notified of the underlying court action, and such a failure, could compel the court to overturn the judgment.
In our practice, the defense of lack of proper service of the initial lawsuit (usually due to service at an outdated address) is extremely effective at voiding the judgment. If the creditor sued you in the wrong county, even better, because now you have a potential countersuit under the FDCPA for a venue violation.
If the amount at issue is low, or you want to settle the debt, you may have the option of offering a settlement to avoid the income execution. This may be advantageous for the creditor because it will not have to wait a long time to get paid on the judgment. If your salary is low, and Marshal poundage fees are added to the equation, it could take years for the creditor to get fully paid. Furthermore, the income execution is only as good as the length of your employment.
Here is a list of New York City’s Marshals who enforce wage garnishments:
- City Marshal Ronald Moses
- City Marshal Bruce Kemp
- City Marshal Gregg E. Bienstock
- City Marshal Martin Bienstock
- City Marshal Henry Daly
The minute you receive any notice regarding a garnishment/income execution, contact us for a free consultation to discuss your rights and your strategy.