Can a Workers’ Comp Payout Be Garnished?

Workers’ compensation is meant to pay bills accrued in relation to a workplace incident. This money is not supposed to serve as a financial gain but to ensure workers don’t suffer losses when treated for injuries or illnesses sustained at work. Another way in which this pay helps is to compensate workers for lost wages.

This compensation depends upon a worker’s disability, earning record, and the duration they aren’t able to work. Can this payout be garnished? Read to find out more.

What is Garnishment?

Garnishment is when your employer holds your compensation and sends it to your creditors to settle your overdue debt. In most cases, your medical bills, vocational rehabilitation costs, and other institutional costs suffered through injuries and accidents are paid to the service providers. Because of this, they cannot be garnished.

The part of your workers’ comp that is susceptible to being garnished is the money paid to compensate for your lost wages. Does the law approve it? In certain circumstances, it is permitted, but generally garnishing workers’ comp payments is not approved.

What Factors Lead to Compensation Being Garnished?

It is rare to see workers’ compensation garnished unless under certain circumstances approved by the law. To be subjected to garnishment, you need to have neglected your legal, financial responsibilities. This includes federal tax liabilities, student loans, child support, student loans, and any other approved responsibility. State or federal laws oversee this whole process.

Besides these duties, creditors can also attempt to implement garnishment if you have overdue bills. Most of these include medical bills, credit card debt, and other related expenses. The compensation is exempt from garnishment with past balances, and it’s in rare circumstances where the state allows this garnishment.

What Cannot Be Garnished?

In most circumstances, unemployment benefits, including Supplemental Security Income – SSI, are exempted from garnishment. However, Social Security Disability and Social Security Funds benefits will be garnished if you have overdue federal taxes or failed child support. If you are receiving state public assistance, it will not be garnished.

A compensation attorney can help you know and follow up with your compensation benefits and determine if they will be subjected to garnishment. A qualified lawyer can help to avoid your compensation being used to pay your past dues. Because of the complexity involved, your lawyer will file the claim and follow it through the entire process to ensure you are fully compensated with all available benefits.

How to Determine the Funds to Be Garnished

There are federal and state laws that govern which money gets garnished to pay overdue debts. With a reliable attorney, you can mostly avoid these garnishments. Your lawyer will file all of the appropriate paperwork to attempt to block garnishment of any of your incoming funds from your workers’ compensation claim.

How Much Can Be Garnished?

There is a percentage set for the amount that can be garnished. The Consumer Credit Protection rule protects 75% of your disposable wages, meaning only 25% is subject to garnishment. Under the law, a maximum of 25% of disposable wage or any payment over 30% of the minimum wage can be garnished.

However, every state has its compensation and garnishment laws. You can check how workers’ compensation settlements are handled in Atlanta.

If suffering from workplace injuries or diagnosed with workplace ailments, you need full compensation as required by the law. It will be disheartening to receive full compensation, only to have those funds garnished without your approval. To receive fair compensation and to avoid garnishment of your benefits, it’s advisable to hire a competent lawyer who will help in all processes.