Garnishee Orders – VERY IMPORTANT !

VERY IMPORTANT developments have taken place with these, which are known as Emolument Attachment Orders which employers are obliged to implement, i.e. to deduct amounts from salary of the affected employee and pay this to the creditor or the court.

What often happens is that the creditor who is owed money by the debtor (who is employed by a company) goes to a court in another jurisdiction to get an order from the magistrate (and often, only the Clerk of the Court actually signs the paper) and then the document is served on the employer, who immediately starts to deduct and pay over.

The Constitutional Court, however, took a dim view of this practice because it did not give the debtor employee a chance to defend the action. Every EAO must have judicial oversight which means that ONLY a Magistrate or a Judge (this will depend on the amount claimed) can issue an EAO and not the Clerk of the Court. Also, the order must be obtained in the jurisdiction where the debtor lives and not in any other province or area. Many employees were being saddled with huge amounts being deducted from their earnings, causing a spiralling indebtedness as these poor workers start to make loans in order to keep their heads above water.

If you are an employer, DO NOT ACT immediately on a “garnishee order” – rather run it by us to check if it’s valid and equitable. Also discuss this with your employees and make sure, if they are not paying their accounts, they know what arrangements to make with their creditors so that they don’t land up in this awful situation.