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2023 - 2024 LEGISLATURE
2023 SENATE BILL 327
June 7, 2023 - Introduced by Senators HUTTON, CABRAL-GUEVARA, WANGGAARD,
BALLWEG and STROEBEL, cosponsored by Representatives TUSLER, ALLEN,
BEHNKE, CONLEY, GUSTAFSON, KITCHENS, MURPHY, O'CONNOR, PENTERMAN,
RETTINGER, ROZAR, SPIROS and WICHGERS. Referred to Committee on Labor,
Regulatory Reform, Veterans and Military Affairs.
***AUTHORS SUBJECT TO CHANGE***
AN ACT to repeal 812.40, 812.405 and 812.42 (2) (b); to renumber and amend
812.39 (1) and 812.39 (2); to amend 812.33 (1), 812.35 (5), 812.35 (6), 812.38
(2), 812.44 (3) and 812.44 (4); and to create 812.39 (1) (a), 812.39 (1) (b), 812.39
(1) (c), 812.39 (2) (b), 812.39 (2m) and 812.395 of the statutes; relating to:
eliminating the 13-week limit on the garnishment of earnings of certain
debtors.
Analysis by the Legislative Reference Bureau
This bill eliminates the 13-week limit imposed on the garnishment of earnings
of certain debtors. Under current law, a creditor may file a garnishment notice with
a court and pay a fee to a garnishee for the purpose of collecting an unsatisfied
judgment for money damages from earnings owed to the debtor by the garnishee.
Current law limits the number of weeks in which the earnings of a debtor, other than
a debtor who is an employee of the state or a political subdivision of the state, may
be garnished to 13 weeks.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SECTION 1. 812.33 (1) of the statutes is amended to read:
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SECTION 1 SENATE BILL 327
812.33 (1) The creditor shall pay a $15 fee to the garnishee for each earnings
garnishment or each stipulated extension of that earnings garnishment, except that
there is no fee for a garnishment to satisfy an order for restitution under s. 973.20
(1r). This fee shall be included as a cost in the creditor's claim in the earnings
garnishment.
SECTION 2. 812.35 (5) of the statutes is amended to read:
812.35 (5) Upon being served, the garnishee shall determine whether the
garnishee may become obligated to the debtor for earnings earned within pay periods
beginning within 13 weeks after the date of service. If it is unlikely that the
garnishee will become so obligated, the garnishee shall send a statement of that fact
to the creditor by the end of the 7th business day after receiving the earnings
garnishment form under sub. (3). The creditor shall send a copy of this statement
to the court within 7 business days after receipt of the statement.
SECTION 3. 812.35 (6) of the statutes is amended to read:
812.35 (6) If the garnishee may become obligated to the debtor for earnings
earned within pay periods beginning within 13 weeks after the date of service, but
one or more earnings garnishments against the debtor have already been served on
the garnishee and not terminated, the garnishee shall retain the earnings
garnishment form and place the garnishment into effect the pay period after the last
of any prior earnings garnishments terminates. The garnishee shall notify the
debtor of the amount of the garnishment and shall notify the creditor of the amount
owed on the pending garnishments that one or more earnings garnishments are in
effect against the debtor by the end of the 7th business day after receipt of the
garnishment form under sub. (3). Unless s. 812.39 (2) or (2m) applies to the debtor,
the garnishee shall recalculate the amount to pay to each creditor for which an
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SECTION 3
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earnings garnishment remains in effect using the procedure under s. 812.39 (1). If
s. 812.39 (2) or (2m) applies, the garnishee shall recalculate the amount to pay to each
creditor for which an earnings garnishment remains in effect using the procedure
under s. 812.39 (2) or (2m), whichever applies. After making the recalculation
required under this subsection, the garnishee shall, subject to the exemption under
s. 812.34 (2) and the limits under s. 812.39 (2) and (2m) on the total earnings that
may be garnished, place the garnishment into effect for the pay period falling after
the 7th business day after receipt of the garnishment form. If, before the earnings
garnishment takes effect, the garnishee determines that it is unlikely that the
garnishee will continue to be obligated to the debtor for earnings, the garnishee shall
notify the creditor and court under sub. (5) within 7 business days after making that
determination.
SECTION 4. 812.38 (2) of the statutes is amended to read:
812.38 (2) A motion or petition under sub. (1) may be made at any time during
the pendency of the earnings garnishment. Within 5 business days after a motion
or petition is filed under sub. (1), the court shall schedule the matter for a hearing
to be held as promptly as practicable. The court shall notify the parties of the time
and place of the hearing. Upon conclusion of the hearing, the court shall make
findings of fact and conclusions of law. The court shall make such order as required
by these findings and conclusions. If the order permits the garnishment to proceed,
the date on which the order is served upon the garnishee shall substitute for the
original date of service of the garnishment upon the garnishee under s. 812.35 (3) for
the purpose of determining any 13-week period under s. 812.35 (5) or (6). A court
order shall bind the garnishee from the time the order is served upon him or her the
garnishee.
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SECTION 5 SENATE BILL 327
SECTION 5. 812.39 (1) of the statutes is renumbered 812.39 (1) (intro.) and
amended to read:
812.39 (1) (intro.) Between 5 and 10 business days after the payday of each pay
period in which the debtor's earnings are subject to the earnings garnishment, the
garnishee shall, subject to the exemption under s. 812.34 (2) and except as provided
in subs. (2) and (2m), pay the creditor that portion of the debtor's nonexempt
disposable earnings to which the creditor is entitled. If the debtor's earnings are
already being garnished by one or more earnings garnishments when the garnishee
is served under s. 812.35 (3) (b) by a creditor with a garnishment form to recover an
amount owed by that debtor, the garnishee shall, subject to the exemption under s.
812.34 (2) and except as provided in subs. (2) and (2m), do all of the following:
SECTION 6. 812.39 (1) (a) of the statutes is created to read:
812.39 (1) (a) Determine 20 percent of the debtor's disposable earnings.
SECTION 7. 812.39 (1) (b) of the statutes is created to read:
812.39 (1) (b) Divide the quotient under par. (a) by the total number of
creditors.
SECTION 8. 812.39 (1) (c) of the statutes is created to read:
812.39 (1) (c) Pay each creditor the amount determined under par. (b).
SECTION 9. 812.39 (2) of the statutes is renumbered 812.39 (2) (a) and amended
to read:
812.39 (2) (a) Court-ordered assignments of the debtor's earnings for support
or maintenance under ch. 767, regardless of the date the garnishee first receives
notice of the assignment, take priority over an earnings garnishment under this
subchapter. If and take priority over a garnishment to satisfy an order for restitution
under s. 973.20 (1r). Except as provided in par. (b), if the debtor's earnings are subject
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to assignment under s. 767.75, the creditor, including a creditor entitled to an
earnings garnishment to satisfy an order for restitution under s. 973.20 (1r), shall
not be entitled to an amount greater than 25 percent of the debtor's disposable
earnings less the amount assigned under s. 767.75. If the garnishee determines that
the amount to be garnished pursuant to an order under s. 767.75 is equal to or greater
than 25 percent of the debtor's disposable earnings, the garnishee shall notify the
creditor and the court under s. 812.35 (5) within 7 business days after making that
determination.
SECTION 10. 812.39 (2) (b) of the statutes is created to read:
812.39 (2) (b) If one or more earnings garnishments are in effect for a debtor
whose earnings are subject to assignment under s. 767.75, the garnishee shall, if the
amount assigned under s. 767.75 is less than 25 percent of the debtor's disposable
earnings, do all of the following:
1. Determine the difference between 25 percent of the debtor's disposable
income and the sum of the following:
a. The amount assigned under s. 767.75.
b. The amount, if any, to be garnished to satisfy an order for restitution under
s. 973.20 (1r).
2. a. If the difference determined under subd. 1. is less than 25 percent of the
debtor's disposable income, divide the difference under subd. 1. by the number of
creditors.
b. Pay each creditor the amount determined under subd. 2. a.
3. If the difference determined under subd. 1. is 25 percent or more of the
debtor's disposable income, notify the creditor and court under s. 812.35 (5) within
7 business days after making that determination.
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SECTION 11 SENATE BILL 327
SECTION 11. 812.39 (2m) of the statutes is created to read:
812.39 (2m) (a) Court-ordered garnishment of the debtor's earnings to satisfy
an order for restitution under s. 973.20 (1r), regardless of the date the garnishee first
receives notice of the court-ordered garnishment, takes priority over an earnings
garnishment under this subchapter. Subject to sub. (2), and except as provided in
pars. (b) and (c), if the debtor's earnings are subject to garnishment under s. 973.20
(1r), the creditor shall not be entitled to an amount greater than 20 percent of the
debtor's disposable earnings less the amount to be garnished pursuant to court order
under s. 973.20 (1r).
(b) If one or more earnings garnishments are in effect for a debtor who owes
restitution under s. 973.20 (1r), the garnishee shall, subject to sub. (2) and except as
provided in par. (c), do all of the following:
1. Determine the difference between 20 percent of the debtor's disposable
income and the amount to be garnished to satisfy an order for restitution under s.
973.20 (1r).
2. Divide the difference under subd. 1. by the number of creditors.
3. Pay each creditor the amount determined under subd. 2.
(c) If the garnishee determines that the amount to be garnished pursuant to
court order under s. 973.20 (1r) is equal to or greater than 20 percent of the debtor's
disposable earnings, the garnishee shall notify each creditor and court under s.
812.35 (5) within 7 business days after making that determination.
SECTION 12. 812.395 of the statutes is created to read:
812.395 Garnishment of earnings remains in effect; notice to debtor.
(1) A garnishment of earnings payable to a debtor, including a debtor who owes
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victim restitution ordered under s. 973.20 (1r), remains valid and effective until the
judgment is satisfied, unless sooner terminated by order of the court.
(2) For a garnishment of earnings that extends beyond a 13-week period,
following the first 13-week period the creditor shall, at least 3 business days before
the payday of the first pay period of each subsequent 13-week period during the
effective period of a garnishment and until the judgment is satisfied or the
garnishment is terminated by order of the court, serve the earnings garnishment
form issued by the clerk of courts under s. 812.35 (2) upon the debtor by one of the
following means:
(a) First class mail.
(b) Certified mail, return receipt requested.
(c) Any means permissible for the service of a summons in a civil action, other
than publication.
SECTION 13. 812.40 of the statutes is repealed.
SECTION 14. 812.405 of the statutes is repealed.
SECTION 15. 812.42 (2) (b) of the statutes is repealed.
SECTION 16. 812.44 (3) of the statutes is amended to read:
812.44 (3) The earnings garnishment form issued by the clerk under s. 812.35
(2) shall be in substantially the following form:
STATE OF WISCONSIN
CIRCUIT COURT: .... County
A.B., Creditor
vs. File or Reference Number ....
C.D., Debtor EARNINGS
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SECTION 16 SENATE BILL 327
and GARNISHMENT
E.F., Garnishee
THE STATE OF WISCONSIN, To the garnishee:
The creditor has been awarded a court judgment that has not been paid. As a
result, the creditor claims that a total of $.... is owed by the debtor, as follows:
A. Unpaid balance on judgment $....
B. Unpaid postjudgment interest $....
C. Costs of this earnings garnishment
(estimated) $....
TOTAL $....
The creditor believes that you will owe the debtor for earnings within the next
13 weeks after the date on which you receive this form. If the $15 fee is tendered with
these papers, you are directed by the court to do the following:
DETERMINE WHETHER YOU WILL
OWE THE DEBTOR EARNINGS
1. Determine if you are likely to owe the debtor for earnings in pay periods
beginning within the next 13 weeks earned on or after the date on which you receive
this form.
2. If you are not likely to owe the debtor for earnings in pay periods beginning
within the next 13 weeks earned on or after the date on which you receive this form,
send a statement stating that fact to the creditor by the end of the 7th business day
after receiving the earnings garnishment forms.
IF THE DEBTOR SENDS YOU AN ANSWER
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SECTION 16
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3. Whenever you receive a debtor's answer form from the debtor, mail a copy of
the answer form to the creditor by the end of the 3rd business day after receipt of that
form. Include the date you received the answer form on the copy sent to the creditor.
4. If the debtor's answer form claims a complete exemption or defense, do not
withhold or pay to the creditor any part of the debtor's earnings under this
garnishment unless you receive an order of the court directing you to do so.
MULTIPLE EARNINGS GARNISHMENTS
5. If the debtor's earnings are already being garnisheed when you receive this
earnings garnishment, place this earnings garnishment into effect the pay period
after the last of any prior earnings garnishments terminates. Notify notify the
debtor of the amount of the garnishment and notify the creditor of the amount owed
on the pending garnishments by the end of the 7th business day after you receive
these forms. If there are no prior pending earnings garnishments against the
debtor's earnings, Determine the amount you will pay to each creditor using the
method described in the section titled “PAYING THE CREDITOR; P AYING
MULTIPLE CREDITORS” and place this earnings garnishment into effect the pay
period that begins at the end of the 7th business day after you receive it.
EARNINGS GARNISHMENTS
LAST 13 WEEKS, EXCEPT
FOR PUBLIC EMPLOYEES AND
EXCEPT FOR GARNISHMENTS TO
SATISFY AN ORDER FOR VICTIM
RESTITUTION REMAIN IN EFFECT
UNTIL THE JUDGMENT IS SA TISFIED
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SECTION 16 SENATE BILL 327
6. The garnishment of the earnings of employees of the state of Wisconsin and
its political subdivisions, and a garnishment to satisfy an order for victim restitution
under s. 973.20 (1r) for victim restitution remains in effect until the judgment is
satisfied. The garnishment of earnings of other employees will affect the debtor's
earnings for all pay periods beginning within 13 weeks after you receive it, unless
the debtor's earnings are already being garnisheed. If this earnings garnishment is
delayed under paragraph 5, above, it will affect the debtor's earnings for all pay
periods beginning within 13 weeks after the first day of the pay period that you put
this earnings garnishment into effect. If the amount claimed by the creditor is fully
paid before the end of the 13 weeks, this earnings garnishment will terminate at that
point.
PAYING THE CREDITOR; PAYING MULTIPLE CREDITORS
7. Between 5 and 10 business days after each payday of a pay period affected
by this earnings garnishment, pay the creditor 20% of the debtor's disposable
earnings for that pay period. If this earnings garnishment is one of 2 or more
earnings garnishments issued for this debtor, before paying any creditor, first
determine 20% of the debtor's disposable earnings for the pay period and then divide
that amount equally between all creditors. Payment is complete upon mailing.
EFFECT OF COURT-ORDERED
ASSIGNMENTS FOR SUPPORT
8. If the debtor has assigned his or her earnings for support by court order, those
support payments take priority over this earnings garnishment. If 25% or more of
the debtor's disposable earnings is assigned for support by court order, do not pay any
part of the debtor's earnings to the creditor. Instead, send the creditor a statement
of that fact by the end of the 7th business day after you receive these forms. If less
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SECTION 16
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than 25% of the debtor's earnings is assigned for support by court order, the amount
the creditor must be paid is reduced so that the total of earnings assigned and
garnisheed, earnings garnished to satisfy an order for restitution under s. 973.20
(1r), this wage garnishment, and all other wage garnishments in effect for this debtor
does not exceed 25% of the debtor's disposable earnings. If this earnings
garnishment is one of 2 or more earnings garnishments issued for this debtor and if
25% or more of the debtor's disposable earnings is assigned for support by court
order, do not pay any part of the debtor's earnings to any creditor. Instead, send the
creditor a statement of that fact by the end of the 7th business day after you receive
these forms. If this earnings garnishment is one of 2 or more earnings garnishments
issued for this debtor and if less than 25% of the debtor's disposable earnings is
assigned for support by court order, determine the amount each creditor must be paid
by first determining the difference between 25% of the debtor's disposable earnings
and the amount assigned for support by court order and then dividing the difference
by the number of creditors. If this earnings garnishment is one of 2 or more earnings
garnishments issued for this debtor and if less than 25% of the debtor's disposable
earnings is assigned for support by court order and if this debtor's earnings are also
being garnished to satisfy an order for restitution under s. 973.20 (1r), determine the
amount each creditor must be paid by first determining the difference between 25%
of the debtor's disposable earnings and the sum of the amount assigned for support
by court order and the amount garnished to satisfy an order for restitution. Then,
divide the difference by the number of creditors.
EXTENSIONS EFFECT OF A GARNISHMENT
TO SATISFY AN ORDER FOR RESTITUTION
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SECTION 16 SENATE BILL 327
9. The debtor and creditor may agree in writing to extend this earnings
garnishment for additional pay periods beginning within 13 weeks after this
earnings garnishment would otherwise terminate. If you receive a written extension
stipulation, and an additional garnishee fee for each extension, you must honor it
unless a different garnishment against this debtor's earnings is served upon you
before the extension takes effect. In that case, the extension is void and you must
return the extension fee to the party who paid it to you If the earnings payable to a
debtor who owes restitution under a court order are being garnished to satisfy that
order for restitution, those restitution payments take priority over this earnings
garnishment. If 20% or more of the debtor's disposable earnings is being garnished
to satisfy an order for restitution, do not pay any part of the debtor's earnings to the
creditor. Instead, send the creditor a statement of that fact by the end of the 7th
business day after you receive these forms. If less than 20% of the debtor's earnings
is being garnished to satisfy an order for restitution, the amount the creditor must
be paid is reduced so that the total of earnings garnished for restitution and
garnished under this earnings garnishment and any other earnings garnishments
in effect for this debtor does not exceed 20% of the debtor's disposable earnings. If
this earnings garnishment is one of 2 or more earnings garnishments issued for this
debtor and if 20% or more of the debtor's disposable earnings is being garnished to
satisfy an order for restitution, do not pay any part of the debtor's earnings to any
creditor. Instead, send the creditor a statement of that fact by the end of the 7th
business day after you receive these forms. If this earnings garnishment is one of 2
or more earnings garnishments issued for this debtor, and if less than 20% of the
debtor's disposable earnings is being garnished to satisfy an order for restitution,
determine the amount each creditor must be paid by first determining the difference
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SECTION 16
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between 20% of the debtor's disposable earnings and the amount being garnished to
satisfy an order for restitution and then dividing the difference by the number of
creditors.
SECTION 17. 812.44 (4) of the statutes is amended to read:
812.44 (4) The notice of exemption served upon the garnishee under s. 812.35
(4) shall be in substantially the following form:
STATE OF WISCONSIN
CIRCUIT COURT: .... County
A.B., Creditor
vs. File or Reference Number ....
C.D., Debtor EXEMPTION NOTICE
and EARNINGS GARNISHMENT
E.F., Garnishee
To the debtor:
The creditor was awarded a judgment against you or your spouse by .... (County
Circuit or Federal District) Court on the .... day of ...., .... (year). That judgment not
having been fully paid, the creditor has now filed a garnishment proceeding against
your earnings from the garnishee. This means that the creditor is seeking to take
some of your earnings to satisfy part or all of the judgment against you or your
spouse.
The total amount of the creditor's claim is as follows:
Unpaid balance on judgment $....
Unpaid postjudgment interest $....
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SECTION 17 SENATE BILL 327
Costs:
a. Garnishment filing fee $....
b. Garnishee fee $....
c. Service of process (estimate) $....
TOTAL $....
By law, you are entitled to an exemption of not less than 80% of your disposable
earnings. Your “disposable earnings" are those remaining after social security and
federal and state income taxes are withheld.
Your earnings are completely exempt from garnishment if:
1. Your household income is below the federal poverty level. See the enclosed
schedules and worksheet to determine if you qualify for this exemption.
2. You receive aid to families with dependent children, relief funded by a relief
block grant under ch. 49, relief provided by counties under section s. 59.53 (21) of the
Wisconsin Statutes, medical assistance, supplemental security income, food stamps,
or veterans benefits based on need under 38 USC 1501 to 1562 or section 45.351 (1)
of the Wisconsin Statutes, or have received these benefits within the past 6 months.
3. At least 25% of your disposable earnings are assigned by court order for
support.
If the garnishment of 20% of your disposable income would result in the income
of your household being below the poverty line, the garnishment is limited to the
amount of your household's income in excess of the poverty line.
If you qualify for a complete exemption or for a limit on the amount of the
garnishment to the amount that your household's income exceeds the poverty line,
you must give or mail a copy of the enclosed debtor's answer form to the garnishee
in order to receive that increased exemption.
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If your circumstances change while the garnishment is in effect, you may file
a new answer at any time.
If you do not qualify for a complete exemption, but you will not be able to acquire
the necessities of life for yourself and your dependents if your earnings are reduced
by this earnings garnishment, you may ask the court in which this earnings
garnishment was filed to increase your exemption or grant you other relief.
IF YOU NEED ASSISTANCE
CONSULT AN ATTORNEY
If you have earnings that are being garnisheed garnished that are exempt or
subject to a defense, the sooner you file your answer or seek relief from the court, the
sooner such relief can be provided. This earnings garnishment affects your earnings
in pay periods beginning within 13 weeks after it was served on the garnishee. You
may agree in writing with the creditor to extend it for additional 13-week periods
until the debt is paid.
PENALTIES
If you wrongly claim an exemption or defense in bad faith, or if the creditor
wrongly objects to your claim in bad faith, the court may order the person who acted
in bad faith to pay court costs, actual damages, and reasonable attorney fees.
SECTION 18.0Initial applicability.
(1) This act first applies to an earnings garnishment proceeding commenced on
the effective date of this subsection.
(END)
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