Text: H.R.5664 — 114th Congress (2015-2016)All Information (Except Text)

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Introduced in House (07/07/2016)


114th CONGRESS
2d Session
H. R. 5664


To amend the Consumer Credit Protection Act to strengthen debt collection exemptions to protect debtors and their families from poverty or bankruptcy, and for other purposes.


IN THE HOUSE OF REPRESENTATIVES

July 7, 2016

Mr. Cummings introduced the following bill; which was referred to the Committee on Financial Services


A BILL

To amend the Consumer Credit Protection Act to strengthen debt collection exemptions to protect debtors and their families from poverty or bankruptcy, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Wage and Garnishment Equity Act of 2016” or the “WAGE Act.”

SEC. 2. Assignment of earnings defined.

Section 302 of the Consumer Credit Protection Act (15 U.S.C. 1672) is amended by adding at the end the following new subsection:

“(d) Assignment.—The term ‘assignment’—

“(1) means a contractual agreement that constitutes or contains an assignment (as described under section 444.2(a)(3) of title 16, Code of Federal Regulations), including an assignment that is revocable at the will of the individual; and

“(2) does not include includes an assignment described in paragraph (ii) or (iii) of section 444.2(a)(3) of title 16, Code of Federal Regulations.”.

SEC. 3. Adjustment to restrictions on garnishment.

Section 303(a) of the Consumer Credit Protection Act (15 U.S.C. 1673) is amended—

(1) by striking paragraph (1);

(2) by striking “whichever is less.”;

(3) by striking “garnishment may not exceed” and inserting “garnishment or assignment may not exceed the lesser of—

“(1) for an individual earning—

“(A) less than or equal to $1,200 (as adjusted for inflation every 3 years, by notice, to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics) a workweek, 10 percent of the individual’s disposable earnings for that workweek; or

“(B) more than $1,200 (as adjusted for inflation every 3 years, by notice, to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics) a workweek, 15 percent of the individual’s disposable earnings for that workweek; or”; and

(4) in paragraph (2)—

(A) by striking “thirty” and inserting “80”; and

(B) by striking the comma at the end and inserting a period.

SEC. 4. Restriction on adverse employment action because of garnishment.

(a) In general.—Section 304 of the Consumer Credit Protection Act (15 U.S.C. 1674) is amended—

(1) by amending the section heading to read as follows: “Restriction on adverse employment action”; and

(2) by amending subsection (a) to read as follows:

“(a) In general.—No employer may take any adverse employment action against an employee because the employee’s earnings have been subjected to garnishment or assignment.”.

(b) Table of contents amendment.—The table of contents in title III of the Consumer Credit Protection Act (15 U.S.C. 1671 et seq.) is amended by amending the item relating to section 304 to read as follows:


“304. Restriction on adverse employment action.”.

SEC. 5. State law with respect to assignments.

(a) Exemption for State-Regulated assignments.—

(1) IN GENERAL.—Section 305 of the Consumer Credit Protection Act (15 U.S.C. 1675) is amended—

(A) in the section heading, by inserting “or assignments” after “garnishments”;

(B) by inserting “or assignments” after “garnishments”; and

(C) by inserting “or assignment” after “garnishment”.

(2) TABLE OF CONTENTS AMENDMENT.—The table of contents in title III of the Consumer Credit Protection Act (15 U.S.C. 1671 et seq.) is amended by amending the item relating to section 305 to read as follows:


“305. Exemption for State-regulated garnishments or assignments.”.

(b) Effect on State laws.—Section 307 of such Act (15 U.S.C. 1676) is amended—

(1) by striking “State” and inserting “State—”;

(2) in paragraph (1), by striking “garnishments” each place such term appears and inserting “garnishments or assignments”; and

(3) in paragraph (2), by striking “garnishment” and inserting “garnishment or assignment”.

SEC. 6. Employer liability for failure to garnish.

(a) In general.—Title III of the Consumer Credit Protection Act (15 U.S.C. 1671 et seq.) is amended by adding at the end the following new section:

§ 308. Delay of garnishment; employer liability

“(a) Delay of garnishment.—A garnishment order directed at an employer with fewer than 50 employees may not require such employer to garnish the earnings of the individual who is the subject of the order earlier than the later of the following:

“(1) 15 business days after such employer receives the order.

“(2) 5 business days after the date on which the individual is regularly scheduled to receive earnings.

“(3) As would otherwise be required by State law or regulation.

“(b) Employer liability.—No employer with fewer than 50 employees shall be liable for failing to respond to a garnishment order unless such employer—

“(1) has been given written notice that specifies the nature of the employer’s failure to comply with the requirements of this title; and

“(2) does not correct the failure described in paragraph (1) within 15 days of receipt of such notice.”.

(b) Table of contents amendment.—The table of contents in title III of the Consumer Credit Protection Act (15 U.S.C. 1671 et seq.) is amended by adding at the end the following new item:


“308. Delay of garnishment; employer liability.”.

SEC. 7. Exemption for amounts in deposit accounts.

(a) In general.—Of the aggregate amount of funds of an individual in deposit accounts, an amount equal to the poverty guideline applicable to a 1-person household contained in the income poverty guidelines prescribed by the Office of Management and Budget (as such amount is annually adjusted by the Secretary of Health and Human Services) shall be exempt and immune from attachment or seizure with respect to any judgment related to a debt.

(b) Inclusion of accounts.—In this subsection, the term “deposit accounts” shall include any account, as such term is defined in section 903 of the Electronic Fund Transfer Act (15 U.S.C. 1693a).

(c) Rulemaking.—The Bureau of Consumer Financial Protection shall issue such regulations as may be necessary to carry out this section.