Ending Administrative Garnishment Act of 2025
- Bill Number
- H.R. 3412
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Education
- Status
- Introduced
- Latest Action
- 2025-05-14: Referred to the House Committee on Education and Workforce.
- Last Updated
- 2025-12-05T22:51:41Z
AI-Generated Summary
Purpose of the Legislation
This bill, titled the "Ending Administrative Garnishment Act of 2025," aims to temporarily suspend and reform the U.S. Department of Education's ability to garnish (withhold) a portion of a person's wages to collect on defaulted federal student loans. It seeks to address issues like improper garnishments by introducing safeguards, accountability measures, and limits on the program's use.
Key Provisions
- Suspension of Wage Garnishment Authority: Starting from the bill's enactment date, the Department of Education's power to garnish disposable pay (wages after required deductions like taxes) is paused until the Secretary of Education certifies to Congress that reforms have been implemented or that the program should end.
- Certification Requirements: At least one year after enactment, the Secretary must certify one of two options to Senate and House education committees:
- Implementation of a new process allowing:
- Quick refunds (within one week) for any improper garnishments, including those violating rules or instructions.
- The Secretary's independent ability to stop or suspend garnishments at any time for individual borrowers or groups.
- Quarterly checks from employers to verify accurate garnishment details, including upcoming amounts and contact information for employees and employers.
- Or, a determination that wage garnishment should no longer apply to any borrowers.
- Data Collection and Reporting: If reforms are certified, the Secretary must create a centralized database tracking demographic and employment details of affected individuals (both before and after enactment). Within 90 days of setup, and annually thereafter, the Secretary must report to congressional committees on the database contents and program evaluation.
- Employer Liability: Employers can be sued in state or federal court by the Secretary, a loan guaranty agency, or the affected individual to recover improperly withheld wages after a suspension notice, plus actual damages, attorney fees, costs, and possibly punitive damages (extra penalties at the court's discretion).
- Department Accountability for Errors: If the Department receives improperly garnished wages, it must return twice that amount to the borrower within 10 days. Courts can issue injunctions (court orders to stop an action) to enforce this, overriding some standard limits on suing the government.
- Time Limit on Garnishment: The Department cannot garnish wages for student loans that have been in default for more than 10 years.
Significant Changes to Existing Law
The bill amends Section 488A of the Higher Education Act of 1965 (which currently allows the Secretary to garnish up to 15% of disposable pay for defaulted student loans without a court order). Key additions include:
- A full suspension of the program until certification, which did not exist before.
- New mandatory processes for refunds, suspensions, and employer verifications.
- Creation of a required database and reporting obligations.
- Expanded legal remedies, such as double refunds for errors, employer lawsuits, and easier court enforcement against the Department.
- A 10-year cap on eligible loans for garnishment, limiting the program's scope.
Potential Impacts
- On Citizens (Student Loan Borrowers): Provides stronger protections against wrongful wage deductions, faster error corrections with double refunds, and relief for those with older debts. This could reduce financial hardship for low-income or error-affected borrowers but might slow overall debt collection if the program remains suspended.
- On Government Agencies: The Department of Education faces new administrative burdens, including process overhauls, database management, and congressional reporting. It could lead to more cautious use of garnishment powers and increased litigation risks.
- On Employers: Introduces verification duties and potential lawsuits for mishandling notices, possibly increasing compliance costs but clarifying liabilities.
- On International Relations: No direct impacts, as the bill focuses on domestic student loan enforcement.
Main Stakeholders Affected
- Student Loan Borrowers: Primary beneficiaries through suspensions, refunds, and limits on old debts; they gain new ways to challenge errors.
- U.S. Department of Education and Secretary: Must implement reforms or end the program, with added oversight and accountability.
- Employers: Responsible for accurate withholding and verifications; face new legal risks for non-compliance.
- Congressional Committees (Senate Health, Education, Labor, and Pensions; House Education and Workforce): Receive certifications and reports, influencing future oversight.
- Loan Guaranty Agencies: Can pursue employer lawsuits and benefit from clearer processes.
Notable Legal, Constitutional, or Political Implications
- Legal Implications: Strengthens borrower rights with expedited remedies and double damages for errors, potentially increasing lawsuits against employers and the government. The injunction provision eases barriers to challenging federal actions, promoting quicker judicial oversight.
- Constitutional Implications: Enhances due process protections (fair treatment under the law) by requiring verifications and rapid error fixes, addressing potential abuses in administrative debt collection without court involvement.
- Political Implications: Signals a push for student debt relief and reform of aggressive collection tactics, likely appealing to advocates for borrower protections while raising concerns among fiscal conservatives about reduced government revenue from collections. The one-year certification delay allows time for implementation but could prolong suspension, affecting federal budget projections for loan recoveries.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Pressley, Ayanna [D-MA-7]
Recent Actions
- 2025-05-14: Referred to the House Committee on Education and Workforce.
- 2025-05-14: Introduced in House
- 2025-05-14: Introduced in House
Bill Versions
- Ending Administrative Garnishment Act of 2025 — issued 2025-05-14 — PDF (6 pages)