What is wage garnishment?
Wage garnishment is legal action taken to collect money on a debt. It allows a creditor, through the use of a court order, to take part of an employee’s paycheque to put toward their debt.
Who is responsible for wage garnishment?
A few parties are at play here – the debtor (employee), the creditor (to whom the debt is owed), the court, and the employer. The process begins when an employee owes a debt to a creditor. The creditor follows a garnishing process to obtain the amount owed to them. The creditor must go to court to get a judgment against the debtor to establish that a debt is owed, and then separately apply for a garnishing order. When granted, the garnishing order is sent to the employer.
When your business is served an official garnishing order, you’ll receive a letter containing all the relevant information pertinent to you and your employee – how much your employee owes, how to calculate the garnishment amount, and where to send the funds. It is the Payroll Administrator’s responsibility to handle wage garnishment during the payroll process.
2023 Wage Garnishment by Province
Provincial and territorial legislation regulate the amount of wage garnishment a creditor can demand, based on an employee’s level of debt, exemption amounts on employee wages or salary, and general governmental rules.
The following table provides an overview of payroll garnishments by province:
- For more information, see our blog post on the facts about payroll garnishment
- See the CRA’s resource on wage garnishment should you need to remit on behalf of the CRA
Disclaimer: The information provided in this guide is for informational purposes only. It is not professional financial or legal advice nor is it intended to be a substitute therefore. Where there are discrepancies between the guide and information provided by the federal government, provincial government, or the Canadian Revenue Agency (CRA) or Revenu Québec, defer to the guidelines provided by the governing agencies.