Garnishment Law Summaries

Colorado's garnishment law is found in the Colorado Rules of Civil Procedure, Rule 103; Colorado Revised Statutes, Title 5, Art. 5; and Title 13, Art. 54, 54.5, and 61.

DEFINITIONS

"Garnishment" means any procedure through which the property or earnings of an individual in the possession or control of a garnishee (the employer) is required to be withheld for payment of a judgment debt (Sec. 13-54.5-101, as amended by S.B. 2, L. 1996, effective July 1, 1996).

"Continuing garnishment" means any procedure for withholding the earnings of a debtor/employee for successive pay periods for payment of a judgment debt (Sec. 13-54.5-101, as amended by S.B. 2, L. 1996, effective July 1, 1996).

"Earnings" means compensation for personal services, whether denominated as wages, salary, commission, or bonus, and funds held in or payable from any health, accident, or disability insurance (Secs. 13-54-104 and 13-54.5-101, as amended by S.B. 2, L. 1996, effective July 1, 1996).

"Disposable earnings" means that part of earnings remaining after deductions required by law and after the deduction of any health insurance costs required under a child support order. It includes money voluntarily deposited in tax-deferred compensation funds (Sec. 5-5-105 and Sec. 13-54-104, as amended by S.B. 2, L. 1996, effective July 1, 1996).

COVERAGE

Wages of all employees, including employees of the State of Colorado, municipal and quasi-municipal corporations, and any officer, board, or commission are subject to garnishment. However, salaries or fees due to any state officer designated as such and whose salary or fees are fixed by the state constitution are not subject to garnishment (Sec. 13-61-101).

PROCEDURES

Amounts exempt from or subject to garnishment. --The maximum part of disposable earnings that is subject to garnishment may not exceed 25 percent of disposable earnings for a week or the amount by which disposable earnings exceed 30 times the federal minimum wage, whichever is less. For earnings for any period other than a week, federal multiples are to be used (Sec. 5-5-105 and Sec. 13-54-104, as amended by S.B. 2, L. 1996, effective July 1, 1996). A garnishment is effective until earnings are no longer due, the judgment is vacated, or for 90 days following service of the garnishment order (Rule 103, Rules of Civil Procedure).

Funds held in or payable from any pension, retirement, or deferred compensation plan, including those in which the employee has received or has the right to receive benefits or payments, and including pensions or plans that qualify under the federal Employee Retirement Income Security Act as employee pension benefit plans, are exempt from garnishment. Roth IRAs are also exempt from garnishment. Except for amounts due under court-ordered child or spousal support, all money received as pension, compensation, or allowance for any purpose arising from service as a member of the U.S. armed forces in time of war or armed conflict is exempt from garnishment. All property that is subject to a judgment against an individual for failure to pay state income tax to a state for periods when the individual was not a resident of the state on benefits received from a pension or other plan is exempt from levy and attachment in Colorado (Sec. 13-54-102, as amended by Ch. 154 (S. 169), L. 2002, effective May 24, 2002).

Bankruptcy. --The general exemption above does not apply to bankruptcy court orders under Ch. 13 of the federal bankruptcy law (Sec. 13-54-104, as amended by S.B. 2, L. 1996, effective July 1, 1996).

Delinquent taxes. --The general exemption above does not apply to any debt due for any state or federal tax (Sec. 13-54-104, as amended by S.B. 2, L. 1996, effective July 1, 1996).

Fraudulently obtained public assistance --The maximum part of disposable earnings that is subject to garnishment or levy for support of any person cannot exceed 35 percent of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage, whichever is less (Sec. 13-54-104, as amended by S.B. 2, L. 1996, effective July 1, 1996).

WHAT THE EMPLOYER MUST DO

An employer served with a garnishment order must withhold as instructed in the order. Any earnings owed to the employee and all earnings accruing from the date of a garnishment order up to and including the 90th day thereafter will be subject to continuing garnishment (Sec. 13-54.5-103, as amended by S.B. 2, L. 1996, effective July 1, 1996).

Priorities in cases of multiple garnishment. --Only one writ of continuing garnishment against an employee can be satisfied at a time. If more than one writ has been issued against an employee's earnings, they must be satisfied in the order of service on the employer. If a continuing garnishment has been suspended for a specific period of time by agreement of the parties, the suspended continuing garnishment will have priority over any writ of continuing garnishment served after the suspension has expired. Upon termination of a lien and continuing levy, any other writ of continuing garnishment that has been or is subsequently issued will have priority in the order of service on the employer, and no priority will be given to any previous lienholder whose lien has terminated. However, a continuing garnishment for child support has priority over all other judgments (Sec. 13-54.5-104, C.R.S. 1973).

Discrimination prohibited. --No employer can discharge an employee because a creditor has subjected or attempted to subject the employee's earnings to any garnishment or like proceeding directed to the employer for paying any judgment (Secs. 5-5-106 and 13-54.5-110).

DEADLINES

An employer must answer a garnishment order no less than five nor more than 10 days after the employee is paid (Rule 103, Rules of Civil Procedure).

ENFORCEMENT

If an employer discharges an employee because of a garnishment, the employee may bring a civil action within 90 days for the recovery of up to six weeks of wages lost as a result of the violation, costs, and reasonable attorney fees, and for an order of reinstatement (Sec. 13-54.5-110).

WHO TO CONTACT

Employers with questions about a garnishment order should contact the issuer of the order.

PENALTIES

If an employer discharges an employee because of a garnishment, the employee may bring a civil action within 90 days for the recovery of up to six weeks of wages lost as a result of the violation, costs, and reasonable attorney fees, and for an order of reinstatement (Sec. 13-54.5-110).

This is a summary of Garnishment Laws in Colorado.