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House approves bill letting small businesses charge garnishment service fees
Summary
House Bill 163, argued as relief for small sellers pursuing collection, passed the House 40–31 allowing businesses to impose a voluntary garnishment service fee (examples given of $10–$20 per month); debate centered on employer discretion and paperwork burdens.
The Utah House passed House Bill 163 on Feb. 17, a bill that permits small businesses that pursue wage garnishment to charge a service fee to cover collection costs.
Sponsor Representative Mascaro told members the bill addresses the practical burden on small sellers who pursue collection after unsuccessful attempts by collection agencies and courts. "So this bill simply allows that small business businessman, if he chooses... he can charge this individual up to 10, dollars 20 a month as a fee for garnishing his checks," Mascaro said.
Members asked whether the fee could be added to the debtor's payment and whether employers are required to impose the fee. Sponsor and backers repeatedly stated the fee is voluntary for employers: "It absolutely is voluntary," the sponsor said in response to questions about employer obligations.
Representative Hutchings urged lawmakers to improve the administrative process for small-business garnishments regardless of the bill's outcome, noting paperwork is 'cumbersome' and creates a burden on employers. Debate was cut off under a previous question and the House recorded final passage at 40 yes and 31 no.
Because the measure changes how collection costs can be allocated in wage garnishment scenarios, employers and consumer advocates were identified as likely follow-up stakeholders.
