Legal Definitions - wage assignment

A wage assignment is a legal process where a portion of an employee's wages are withheld by their employer to pay off a debt or obligation. This can be done voluntarily or through a court order.

1. John owes $5,000 in back child support. The court issues a wage assignment order, requiring his employer to withhold a certain amount from each paycheck and send it directly to the child support agency until the debt is paid off.

2. Mary has a credit card debt that she is struggling to pay off. She contacts her credit card company and sets up a voluntary wage assignment, where a portion of her paycheck is automatically deducted and applied towards her debt each month.

These examples illustrate how a wage assignment can be used to ensure that debts are paid off in a timely manner. By withholding a portion of an employee's wages, creditors can have a reliable source of payment and employees can avoid falling further into debt.