Attachment of earnings orders

An attachment of earnings order allows a judgment creditor to get a debtor’s employer to make deductions directly from their pay packet to repay the debt. The order can only be made if the debtor has failed to make at least one payment towards their CCJ.
What is an attachment of earnings order?

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Judgment creditors can request an attachment of earnings order for any debt over £50, as long as the debtor has failed to make at least one payment. An attachment of earnings order can only be made against an individual who is employed under a contract of service (PAYE), it cannot be made against a company or partnership.

It is possible to request a suspended order to avoid your employment being affected, see suspended orders below.
Attachment of earnings orders are governed by the Attachment of Earnings Act 1971.

  • An order can be made against:
    • Salary or wages
    • Overtime pay
    • Commission and fees
    • Bonuses
    • Occupational pensions
    • Statutory sick pay
  • An order cannot be made against:
    • Self-employed income
    • State pensions
    • Tax credits
    • State benefits
    • Disability allowances
    • Pay of a member of the Armed Forces
The process
Coins on scales

  1. The creditor completes the application form and files it at court.
  2. The court sends you notice of the application (form N55) and form N56 to fill in with your statement of means and repayment offer.
  3. If you inform the court that he is self-employed or unemployed the application will be dismissed.
  4. If you return the filled in form, the court staff will make the order applying certain guidelines. In some cases it may be necessary to refer the application to a judge.
  5. The order will be sent to the creditor with a copy to you and your employer with instructions to deduct the amount ordered by the court from your pay and forward it to the court. The employer is entitled to make a small deduction for admin costs.
  6. If you object to the order, you can apply for the order to be reconsidered by a district judge at a hearing.
  7. If there is no response from you, the court will serve you with an order to produce a statement of means. If the creditor knows who your employer is, they may contact them directly.
  8. If you fail to respond to the order to produce a statement of means, you will be given notice of a hearing you will be required to attend.
Failure to attend the hearing can result in arrest and committal to prison.
Suspended order
You can request a suspended order by ticking the box in item 10 of the N56 form and giving your reasons for requesting a suspended order below your repayment offer. The most common reason is that an attachment of earnings order could affect your employment.
A request for a suspended order should be granted unless there is another attachment of earnings order already in place.

An attachment of earnings could affect your employment if:

  • You work in the financial sector, even in a support role;
  • You are in a position of trust within your organisation;
  • You handle money;
  • You work in professional services such as accountancy or law;
  • You work for a security firm
  • You work as a broker or financial advisor.
Filling in the form

You need to fill in your personal details where indicated. Item 3 deals with your employment status. Creditors don’t always know whether you work for an employer or are self-employed or unemployed. If you are not employed, the court cannot make an order and the application will be dismissed.

Although the application for an attachment of earnings order will be dismissed if you are not in employment, you will still need to make arrangements to repay the judgment, otherwise the creditor can take further enforcement action. See enforcement.

Note that Item 7 refers only to ARREARS of priority payments such as housing (rent or mortgage), utilities and maintenance payments, regular payments should be included under Item 6. The court will consider the time it could take to clear the arrears and take this into account when making the order.

Item 8 refers only to debts subject to a judgment, such as CCJs and other court orders (i.e. costs orders). Payments for secured loans should be included under Mortgage. Item 9 refers to all unsecured debts not subject to a judgment. A debt secured on your home via a charging order would go under court orders (Item 8) and not under Mortgage payments. You may need to attach a sheet to list all debts subject to judgment and unsecured debts.

Calculate your repayment offer and enter it in the box under Item 10. You may want to request a suspended order, see suspended orders.

You should make a copy of the form and send it recorded delivery to the court where the application was made. You will find this information on the notice of application.
How the order is made

CalculationsThe court will consider the financial information provided on the N56 form to determine your protected earnings rate, which is the amount the court considers you need to support yourself and your family. Any deductions made under the order will not reduce your income below this level.

An income level equivalent to state benefits (income support or JSA) plus housing costs, work related expenses and other court order repayments (CCJs) is considered the minimum amount and no order will be made unless your income is above this level.

Based on the protected earnings rate, the court will set a normal deduction rate which is the amount that will be deducted from your earnings every week or month. The guidance suggests deductions to be between 50% and 66% of your disposable income, which is the difference between the protected earnings rate and your net earnings.

The Centralised Attachments of Earnings Payment System based at Northampton will send your employer a copy of the attachment of earnings order on form N60. From the next payday following receipt of the order, your employer must make the deductions ordered by the court and send them to CAPS, who will send payment to the creditor.

If the court agrees to a suspended order, it will only be sent to your employer if you fail to pay the agreed installments.

Wages payslipYour employer will get the following information:

  • The total amount due under the judgment(s);
  • The normal deduction rate; and
  • The protected earnings rate.

If the attachable earnings are more than the protected earnings, the employer must deduct from the attachable earnings the lesser of either the normal deduction or the excess.

Employers are entitled to deduct £1 for administration costs whenever they make a deduction under a court order (even if this reduces the judgment debtor’s income below the protected earnings rate).

Your employer can only make deductions from earnings in excess of the protected earnings rate. No deductions can be made if your earnings are insufficient and shortfalls cannot be carried forward.
While an attachment of earnings is in place, permission of the court is required to apply for a warrant of control for the judgment.
You have a duty to notify the court of any change in your circumstances such as if you change jobs, are made redundant, become unemployed or self-employed. If you get another job, you need to notify the court within seven days.
Failure to inform the court of changes in your employment can result in a fine or imprisonment.
If you change jobs, the order will be transferred to your new employer. If you are unemployed for some time, you can apply to the court to cancel the order.
Objections and variations

Objections

Both you and your creditor can object to the terms of the order and you have 14 days to give notice to the court. If you wish to object, you need to write a letter stating your grounds for the objection, for example if the normal deduction rate does not leave you with enough funds to meet your family’s needs or if you requested a suspended order, how your employment can be affected if your employer receives the order.

The matter will be decided at a hearing in your local court. You should attend the hearing and take with you a financial statement and details of your expenditure and any other debts. This is your opportunity to explain how the order could cause you problems if you can’t meet your family’s needs or lose your job as a result of the order being made.

Variations

If you can no longer afford the deductions made under an order or your circumstances have changed, you can apply to the court for a variation of the order on form N244.  You will need to attach a new budget sheet and explain why you can’t afford the current deduction rate. You can also apply to suspend the order if your circumstances at work change. There is a fee to pay but you may qualify for fee remission in certain cases, see form ex160a.

Multiple orders

Priority

payslipsAn attachment of earnings order from the county court does not take priority over an attachment of earnings order to recover fines, council tax, maintenance or child support arrears.

If the county court order was made earlier than a direct earnings attachment from the DWP to recover benefit and tax credits overpayments, it takes priority.

Where more than one order is in force, your employer must first deal with any priority orders (in date order) then non-priority orders (also in date order). The first order would be dealt with as already described. Before dealing with any other order, the employer must reduce the attachable earnings by the amount deducted under each preceding order.

Consolidation

It is possible to apply for a consolidated order if :

  • You have two or more attachment of earnings orders
  • You already have an order in force and a second one is applied for
  • You have an order in force and at least one more CCJ

You need to provide the court with a statement of means and details of the other judgments. This can have the advantage of dealing with a single protected earnings rate and deduction figure and not having to worry about makin several payments.

If there is another order in force, the court can suggest a consolidated order. Under a consolidated order, the employer has to make just one deduction each pay day. The money will be allocated to each creditor in proportion to the amount of each debt and be distributed between the creditors by the court.

To apply for a consolidated order you have to make an application to the court on form N244, giving details of all the attachment of earnings orders and county court judgments that you want to consolidate. Unlike other applications, you do not have to pay a fee for this one, however, when the consolidated order is in force the court will deduct 10% of the amount paid in to administer the consolidated order. The matter will usually be dealt with without a hearing.

You can only include debts subject to a judgment (CCJs and court orders), any other debts will have to be included in your budget sheet but will not be included in the consolidated order.

If your budget sheet shows you can’t afford to pay any more than the rate of your current order and would like that amount divided between your judgment creditors, you can say so in your application.
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If you can't afford your CCJ repayments, you need to apply for a variation to avoid enforcement action.
See variations.