H.R. 3412: Ending Administrative Garnishment Act of 2025

This bill, known as the Ending Administrative Garnishment Act of 2025, aims to change how the U.S. government can collect money owed for federal student loans through wage garnishment. Currently, the government can take a portion of an individual's paycheck to pay off defaulted student loans. The bill proposes several key changes:

Suspension of Wage Garnishment

The bill would suspend the authority to garnish wages for individuals who owe federal student loans. This suspension would begin on the date the bill is enacted and would last until the Secretary of Education confirms certain conditions are met.

Conditions for Resuming Garnishment

The Secretary of Education must submit a certification to Congress that the following conditions are met:

• The Secretary has established a process to ensure individuals who have had their wages wrongly garnished can get a refund within a week.
• The Secretary has the discretion to stop the wage garnishment program at any time.
• The Secretary must ensure that all relevant information for garnishments from employers is accurate, including verifying that the data is up-to-date each quarter.

Database Creation

If the Secretary certifies that the necessary processes are implemented, they are required to create a centralized database. This database will include:

• The addresses, occupations, employers, and demographic data of individuals whose wages were garnished before the enactment of the bill.
• Similar data for individuals currently having their wages garnished under the old system.

Additionally, the Secretary must report on this database and the use of garnishment authority at least once a year.

Employer Liability

Employers can be held liable if they improperly withhold wages due to garnishment orders. The Secretary or affected individuals can sue the employer for any damages resulting from such actions.

Reimbursement for Improper Garnishment

If an individual’s wages are improperly garnished, the Secretary must pay them double the amount wrongfully taken within 10 days of gaining possession of that garnished pay.

Time Limits on Garnishments

The bill also establishes that no wage garnishment can occur for loans that have been outstanding for more than 10 years.

Overall Impact

The intended effect of this bill is to provide more protection for borrowers, ensuring that wage garnishment is only applied when it is appropriate and that individuals have clear recourses if mistakes occur in the garnishment process.

Relevant Companies

None found.