What Is A Garnishee Order?
If you are trying to enforce a debt against an individual who has limited assets, but is employed and receives a wage or salary, you may apply for a Garnishee Order. The order is served on their employer and compels them to pay some of the debtors wage or salary to you, until the debt is repaid.
This means the court will direct the employer to pay you directly, instead of the person (the ‘judgment debtor’) paying you back. This is advantageous as the person cannot withhold payment from you.
There can be some instances where this type of debt recovery may require a different approach:
1. Where the individual is earning a small wage, the court may only order a small proportion of the wages be allocated to the creditor (currently in NSW the person must be left with at least $516.40 of wages). This means that as a creditor, you may have to wait a long time to recover the full amount of the debt.
2. If the debtor stops working and has no source of income, or receives Centrelink or Workcover payments, the court will not grant a Garnishee Order as their income is too low and/or the payments are exempt.
If this occurs, one option may be to seek an agreement with the debtor to pay in instalments. This agreement may require the debtor to pay higher amounts than what the Garnishee Order would allow, which means you could be repaid faster.
We realise that each case is different, and we recommend discussing your various options to find a solution that best suits your needs.
If you need help with recovering a debt from an individual then please give us a call - 02 9922 4111