The U.S. Department of Education (Department) continues to garnish the wages of student loan borrowers despite some efforts to comply with the law. One of those borrowers is Craigory Lee A. Jenkins, whose wages continue to be garnished, depriving her of exactly the relief Congress decided she needed when it passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Late last night, the National Consumer Law Center (NCLC) and Student Defense, filed a motion on behalf of Ms. Jenkins for a preliminary injunction asking the court to order the Department and Secretary Elisabeth DeVos to immediately suspend all administrative wage garnishments as required under the CARES Act.
This is the latest in a lawsuit brought by NCLC and Student Defense, with the support of the Student Borrower Protection Center (SBPC), against the U.S. Department of Education and Secretary Betsy DeVos. The CARES Act prohibits the Department from garnishing wages of student borrowers through September 30, 2020.
The lawsuit was filed on behalf of a class of distressed borrowers whose paychecks continue to be seized, in clear violation of federal law, including lead plaintiffs Ms. Jenkins, a cabinet sales specialist at Lowe’s Home Centers, and Elizabeth Barber, who works as a home health aide near Rochester, NY. Due to the COVID-19 crisis, both women have seen their wages decrease and are struggling to make ends meet.
The very purpose of the CARES Act is to provide immediate emergency relief to Americans, like Craigory and Elizabeth, suffering the economic consequences of the coronavirus pandemic.
Under normal circumstances, the Department has the extraordinary authority to garnish the wages—without a court order—of individuals who default on their federal student loans, withholding up to 15 percent of a borrower’s paycheck to collect on past-due student loan debts. In the 2018 fiscal year, the Department of Education seized more than $840 million using wage garnishment, and the Department estimates that approximately 285,000 borrowers were subject to the practice in the last month alone.
In the CARES Act, Congress gave most federal student loan borrowers a six-month reprieve from paying back their loans, and prohibited the Department of Education from using involuntary collection practices, including wage garnishment, against borrowers in default. But for Ms. Barber, Ms. Jenkins, and many other borrowers, that hasn’t been the case. Guidance posted on the Department’s website asserts that borrowers may continue to see their wages garnished, promising a refund at some unspecified, future time–a practice that does not satisfy the clear requirements of the CARES Act and ignores the urgent current financial needs of borrowers during the coronavirus pandemic.
The lawsuit demands that the Department immediately implement the suspension of wage garnishment and refund any money taken from Ms. Barber, Ms. Jenkins, and all other borrowers.
Over the past month, the Student Borrower Protection Center has been flooded with stories from borrowers across the country seeing their hard-earned wages unlawfully seized. These troubling accounts depict a broken collections system operating without regard for borrowers’ protections under the law.
Following reports of illegal garnishment, Senator Cory Booker and Congresswoman Ayanna Pressley led a group of over 40 members of Congress in a letter blasting Secretary DeVos earlier this month. The lawmakers called on the Secretary to issue guidance halting all involuntary collections effective immediately and to provide a clear timeline for refunds to borrowers who have had wages unlawfully garnished since the new protections were put in place.
Have you had your wages garnished since the CARES Act passed? Share your story.
