Credit Protection Act of 1968

The Consumer Credit Protection Act was legalized in 1968. Essentially, the Consumer Credit Protection Act is a wage garnishment law that protects an employee from a company from being fired by that company because of a debt that they have incurred.

Wage garnishment is a fee that can be withheld from a paycheck in order to repay a debt. This is not a normal process that occurs with all employees. Instead, this is one that is often mandated by a judge or is required by law for individuals who owe money to the Government and certain other facilities.

Under the Consumer Credit Protection Act, consumer credit in the form of a singular debt is not considered a basis for an individual to be fired regarding wage garnishment. What this means is if an individual has one debt and requires money to be taken out of his/her paycheck, by law the employer must take the money out and pay it to the proper facility.

However, if an individual has two or more debts and has been ordered to pay through wage garnishment, the employer can terminate the individual’s job on these grounds.

What the Consumer Credit Protection Act does is ensures that an individual is able to pay for their consumer credit and be returned to good financial standing. By taking the money directly out of the paycheck and through the facilitative hands of the employer, the Government ensures that the debt is repaid and the individual with the wage garnishment does not have to worry about repayment.

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