Stopping a Wage Garnishment by Filing Bankruptcy in San Jose

Bankruptcy Stops a Wage Garnishment in San JoseEvery individual who files personal bankruptcy, whether Chapter 7 or Chapter 13, gets immediate protection from the collection efforts of his creditors. This immediate protection is the Automatic Stay provided in section 362 of the Bankruptcy Code, which prevents, for so long as it remains in effect, the garnishing of the bankruptcy debtor’s wages (except for domestic support obligations), levies against his bank accounts, foreclosures, evictions, or the continued prosecution of civil law suits, among other types of collection activities. Thanks to the protection of the Automatic Stay, filing personal bankruptcy in California will put a stop to a wage garnishment.

Although the Automatic Stay goes into effect immediately, in practice it often takes a good deal of effort by a bankruptcy attorney to stop a wage garnishment once the bankruptcy petition is filed with the court. This is because there are at least three parties involved in the garnishing of the debtor’s wages. After a creditor obtains a civil judgment against an individual in California, in order to garnish that individual’s wages, the judgment creditor must obtain a Writ of Execution and then an Earnings Withholding Order from the California Superior Court. Each of these is then sent to the levying officer at the civil division of the sheriff’s office of the same county. It is the sheriff’s office that serves the Earnings Withholding Order on the debtor’s employer, which in turn, causes the debtor’s wages to be garnished.

When one of our Bay Area bankruptcy clients is suffering a wage garnishment, the same day we file a bankruptcy in San Jose we immediately send fax notifications to all these parties demanding that the wage garnishment be stopped. This means the judgment creditor, the levying officer at the county sheriff’s office that served the withholding order, and the human resources department or payroll administrator at the client’s employer. We inform them that the client’s bankruptcy case has been filed and assigned a case number, and that the Automatic Stay is now in effect. We expect, and our client needs, prompt compliance with our demand. In a perfect world, not another dollar would be garnished thereafter from any of our client’s future paychecks.

Unfortunately, stopping a wage garnishment is a bit like quickly turning an oil tanker. They don’t turn on a dime. Many corporate human resource departments are stubbornly slow to comply until they confirm with the sheriff’s office that the wage garnishment must, in fact, be suspended. The civil divisions of many California county sheriff’s offices, are inundated and, like so many county level public services in California, underfunded. Therefore it may take several days for the sheriff’s office to communicate with the employer. Frequently, even in large California counties, only one levying officer or a small staff is charged with issuing and keeping track of Earnings Withholding Orders and notices of Bankruptcy filings like ours. The judgment creditor has the least control over stopping a wage garnishment. All they can do is request that the sheriff’s office tell the employer to stop garnishing.

In all cases, we communicate notice of our clients’ bankruptcy filings to their employer and the sheriff as soon as we file the case. Ensuring that no additional wages are garnished from our clients’ paychecks after filing often entails convincing busy county and corporate personnel to drop what they are doing and focus on our clients’ needs as quickly as possible. This is an area where practicing diplomacy most often gets the quickest results.

Our San Jose bankruptcy attorneys have helped hundreds of clients get out of debt, stop wage garnishments, and start fresh through bankruptcy. If you live in the San Francisco Bay Area and have been sued or are having your wages garnished due to a civil judgment, contact us for a free consultation.

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