Septem­ber 16, 2017

Saturday Star - - INSIGHT - STAFF RE­PORTER

EM­PLOY­EES whose in­come is “gar­nished” to pay off their debts can breathe eas­ier thanks to new leg­is­la­tion that was en­acted re­cently. On July 31, Pres­i­dent Ja­cob Zuma signed into law the Courts of Law Amend­ment Act, which amends the Mag­is­trates’ Courts Act.

The re­sult of a Con­sti­tu­tional Court rul­ing, the amend­ments pro­vide South Africans with greater pro­tec­tion against emol­u­ments at­tach­ment or­ders (EAOs), the is­su­ing and man­age­ment of which have been poorly reg­u­lated in the past.

An EAO is an or­der is­sued via the courts by a cred­i­tor on an in­debted worker’s em­ployer, known as the “gar­nishee”. It com­pels the em­ployer to deduct money from the worker’s salary or wage to pay the cred­i­tor.

Pre­vi­ously, EAOs were au­tho­rised by the clerk of the court and could eas­ily be ob­tained from al­most any court, re­gard­less of where em­ploy­ees worked or lived, or whether they were present to de­fend them­selves. Any num­ber of cred­i­tors could de­mand such or­ders, with­out well-de­fined lim­i­ta­tions.

“This lack of con­trol gave credit providers ex­ten­sive power to gar­nish work­ers’ salaries or wages, with lit­tle con­sid­er­a­tion for their abil­ity to sur­vive or their con­sti­tu­tional right to jus­tice,” says Ar­lene Leg­gat, a di­rec­tor of the South African Pay­roll As­so­ci­a­tion. “The new law af­fords em­ploy­ees the op­por­tu­nity to de­fend them­selves and re­lieves the eco­nomic bur­den im­posed on them.”

The law im­poses a limit on the to­tal amount that may be de­ducted, which can be no more than 25% of a worker’s salary or wage, re­gard­less of the num­ber of ac­tive EAOs against them. “Be­fore, there was no limit,” Leg­gat says, “and I’ve per­son­ally seen work­ers go home pen­ni­less, be­cause their en­tire in­come was at­tached to debts.

“While ev­ery­one has a re­spon­si­bil­ity to pay their cred­i­tors, the sit­u­a­tion was un­sus­tain­able.”

The leg­is­la­tion does not ap­ply ret­ro­spec­tively, mean­ing that EAOs al­ready in place are not af­fected.

The 25% limit ap­plies to ba­sic in­come and ex­cludes ad­di­tional re­mu­ner­a­tion for over­time or other al­lowances, mean­ing that such ad­di­tional re­mu­ner­a­tion can­not be gar­nished.

Fur­ther, an EAO must be au­tho­rised by a mag­is­trate – not the clerk of the court – at a court that has ju­ris­dic­tion.

Be­fore ap­prov­ing the or­der, the mag­is­trate must con­sider whether the or­der is just and eq­ui­table, tak­ing into ac­count factors such as the size of the debt, al­ter­na­tives to re­cover the debt, the worker’s in­come and nec­es­sary ex­penses, and any ex­ist­ing EAOs.

Another pro­tec­tive mech­a­nism is a clause that pro­hibits any­one from re­quir­ing a credit ap­pli­cant to con­sent to a judg­ment, in­stal­ment

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.