The amount of wages exempt from garnishment is higher under the California standard than the federal standard.

A withholding order cannot exceed the lesser of:

• 20 percent of an individual's disposable earnings for the workweek; or
• 40 percent of the amount by which the disposable earnings for the week exceed 48 times the state minimum hourly wage in effect. If the debtor works in a location where the local minimum hourly wage is greater than the state minimum hourly wage, the local minimum hourly wage in effect at the time the earnings are payable must be used for the calculation.2

For any pay period other than weekly, the following multipliers must be used to determine the maximum amount of disposable earnings subject to levy under an earnings withholding order:

• For a biweekly pay period, multiply the applicable hourly minimum wage by 96 work hours.
• For a semimonthly pay period, multiply the applicable hourly minimum wage by 104 work hours.
• For a monthly pay period, multiply the applicable hourly minimum wage by 208 work hours.

The law defines “disposable earnings” as the portion of an individual's earnings that remains after deducting all amounts required to be withheld by law.3

Different limits apply for child support 50 percent of amount remaining after deductions).

If you receive a garnishment order, follow these general guidelines:

• Advise the employee of the court order and the date the first deduction will be made.
• Do not garnish a paycheck for more than the amount allowed by law.
• Do not terminate an employee because their wages are garnished for the payment of one judgment.4 A judgment against an employee is a single debt, regardless of the number of garnishments based on it. You can discharge employees for garnishments for multiple judgments other than child support. However, consult legal counsel before doing so.
• Keep a copy of the court orders in the employee’s personnel file as the legal basis for making the payroll deduction.
• If an employee is subject to multiple garnishments, pay child support payments first.

Child Support

Your obligation to withhold child support owed by an employee pursuant to an appropriate order is even more extensive than the requirements for other garnishments.

• The law holds you responsible for your employees’ child support obligations. You face severe penalties for noncompliance in some cases. You may become liable for the full amount of a child support claim filed against the employee plus interest, cost and penalties.5

The law requires each state to establish standard award guidelines and make child support payments as certain as tax payments through automatic wage deductions.

Be aware of the following general provisions of this law:

• You can deduct and retain $1.50 from the earnings of the employee for each payment made pursuant to a Wage and Earnings Assignment Order for child support. This fee is in addition to the amount ordered to be withheld on the Wage and Earnings Assignment Order.6 You cannot make retroactive deductions.
• The law prohibits job discrimination based on automatic child support withholding. You may open yourself to state and federal penalties if an applicant claims discrimination based on employment inquiries about child support obligations. An increase in payroll costs due to child support withholding is not a valid reason for rejecting an applicant.
• State and federal law prohibit terminating an employee for child support withholding, garnishment or threatened garnishment.
• For a former employee, the law requires that you provide, in writing, the employee’s last known address and new employer’s name and address, if known. You also must keep the order on file and honor its provisions if the employee returns to work.
• Although you need not notify the employee about the withholding notice, it is a sound practice. Advise the employee of the date the notice is received, the date withholding begins, the amount to be withheld and the requirement that you must comply with the order.
• You must comply with the child support withholding order as written until directed otherwise by the issuing agency or the court, even if the employee insists the withholding order is incorrect. Refer the employee to the local child support enforcement office to correct any inaccuracies.
• Child support claims take precedence over all other claims, except taxes. If the total amount to be withheld exceeds 50 percent of net disposable income, contact the state support enforcement agency for guidance.
• You must pay multiple child support garnishments in pro rata shares, with current support payments taking priority over past due support still owed. If the total amount exceeds the limit that state and federal laws exempt from a portion of the employee’s wages or if out-of-state orders are involved, ask the local child support office for guidance. If you are a multistate employer, an order delivered to your representative in the issuing state but applicable to an employee working in another state binds you to the issuing state’s laws.
• When you receive the child support order, mark the date received on the notice and retain the envelope with its postmark in case timely compliance becomes an issue. Federal law requires that withholding begin no later than the first pay period occurring after the mailing date of the notice. The wage withholding order requires delivery of the withheld child support within 10 days.
• You may stop child support withholding only upon order from the state’s child support enforcement agency or the court. You must inform the appropriate agency if an employee subject to wage withholding leaves. You must resume withholding immediately upon the employee’s rehire.

Establish a standard procedure for processing child support withholding and garnishment orders. Apply that policy consistently and include any confidentiality guidelines. In addition, because of the emotional nature of orders in some situations, train your payroll coordinator not only on law and compliance procedures, but also on organization policy for handling distressed employees.

More information on child support wage garnishments can be found on the California De-partment of Child Support Services website.

Penalty for Failure to Comply With Child Support Order

A court may order a child support garnishment to be paid by electronic transfer from the employer’s bank account if the employer willfully fails to comply with the garnishment.7 The court may also order an electronic transfer when the employer fails to comply with the garnishment on three separate occasions within a 12-month period, regardless of whether the failures were willful.

In addition, you may be subject to a civil penalty of up to 50 percent of the support amount not received, plus interest on the unpaid support.

The law imposes liability upon any person or business entity that knowingly assists a person who has an unpaid child support obligation to escape, evade or avoid current payment of those unpaid child support obligations. The penalty is three times the value of the assistance to have been provided, up to the total amount of the entire child support obligation due. The penalty will not apply if the unpaid obligation is satisfied. When an individual or entity knows of or should have known of the child support obligation, prohibited actions include:

• Hiring or employing a person who owes child support and failing to file a timely report of this employment to the Employment Development Department’s (EDD) New Employee Registry.
• Retaining an independent contractor who owes child support and failing to file a timely report of the engagement with the EDD.
• Paying wages or other forms of compensation, including cash, barter or trade, that aren’t reported to the EDD.

More Than One Garnishment

Under California law, an employee’s wages generally cannot be garnished for more than one order at a time, except in limited circumstances where priority rules apply. Key points:

1. First garnishment takes precedence
• California Code of Civil Procedure §706.023(a) requires an employer to honor the first earnings withholding order received.
• §706.023(c) explicitly states that any subsequent order is ineffective while the employer is still complying with the first garnishment.
2. Exceptions— priority orders
• IRS garnishments take priority over all other orders. They must be paid in full before most other garnishments.
• Child or family support orders have priority over other garnishments (except IRS orders), per CCP §§706.030(c)(2) and 706.031(b). Employers must withhold the percentage specified in the order — often 50–65% of disposable income.
3. Disposable earnings limit
• Garnishments are limited to 25% of disposable earnings for most non-priority orders (after required taxes).
4. Practical example
• If an employer is already withholding 25% for a wage garnishment and then receives a child support order for 25%, the employer must honor both, taking 25% for the first garnishment and an additional 25% for the support order, respecting the priority rules.
5. Protections for employees
• Labor Code §2929 prohibits discharging an employee because of a threatened garnishment for a single judgment.
6. Recommendation
• Because multiple garnishments, especially with priority conflicts, are complicated, consult the issuing agency and legal counsel before making payroll deductions.

In short: one non-priority garnishment at a time, but priority orders (IRS and child/family support) can override the “first order” rule.

First, Not Second

The California Code of Civil Procedure provides in Section 706.023(a) that an employer shall comply with the first earnings withholding served upon the employer.

Section 706.023(c) states, however: "If an earnings withholding order is served while an employer is required to comply with another earnings withholding order with respect to the earnings of the same employee, the subsequent order is ineffective, and the employer shall not withhold earnings pursuant to the subsequent order."

This means the first garnishment received gets paid and only one garnishment at a time is paid.

Disposable earnings consist of what remains after legally required taxes are deducted. Garnishments are limited to 25 percent of an employee's disposable earnings.

IRS Garnishments Exception

Internal Revenue Service (IRS) garnishments generally take priority over all other garnishment orders and must be paid in full before any additional garnishments are taken. If the IRS order is less than 50-65 percent of the employee’s disposable income, however, the remaining amount may be taken for the support order or for a state tax garnishment. Further, the IRS may yield in full to a support order, but there is no guarantee it will do so.

Child/Family Support Orders Are Priority

A support order for child or family support has priority over any other earnings withholding order pursuant to California Code of Civil Procedure Sections 706.030(c)(2) and 706.031(b), except an IRS garnishment as discussed above.

An employer is required to withhold 50-65 percent of the employee’s disposable income (or income after statutory withholdings), depending on a variety of factors. The amount of withholding should be specified in the order. For example, an employer is currently honoring a wage order from the Employment Development Department in the amount of 25 percent of the employee’s disposable income. The employer then receives a wage garnishment order for child support for 25 percent of the employee’s disposable income. The employer may continue to deduct the 25 percent for the first order, but must take an additional 25 percent from the employee’s disposable income for the support order.

Seek Clarification from Agencies

This area of the law is very complicated. Employers may need to consult with the agency that originated the order, as well as their legal counsel, before making payroll deductions for wage garnishment. The California Franchise Tax Board has very useful information on its website that may provide additional guidance as well.

1. Code of Civ. Proc. sec. 706.034