New law prevents total garnishment
Employees whose income is garnished to pay outstanding debts can breathe easier thanks to new legislation. On July 31, the president signed into law the Courts of Law Amendment Act No. 7 of 2017.
The result of a Constitutional Court ruling, the amendments offer greater protection to indebted persons against emolument attachment orders, the issuing and management of which have been poorly regulated in the past.
An emolument attachment or- der (EAO) is an order issued by a creditor on an indebted person’s employer, known as a garnishee. It compels them to deduct a specified amount from the worker’s income to pay the creditor.
Previously, EAOs were authorised by the clerk of the court and could be easily obtained from almost any court, regardless of where the employee works or resides, and their ability to be present to defend themselves.
Of greatest significance is that the new law imposes a limit on the amount that may be deducted, which can be no more than 25% of a worker’s salary or wages, regardless of the number of active EAOs against them. The limit applies to basic income and excludes additional remuneration for overtime or other allowances.
EOA authorisation must be given by a magistrate. There’s a clause prohibiting anyone from requiring a credit applicant to consent to a judgment.