Sponsors (2)
The bill strengthens protections and transparency for borrowers—preventing long‑running garnishments, pausing automated collections until safe, and requiring rapid refunds—while shifting costs, administrative burdens, and data‑security risks onto employers, the Department, and taxpayers.
Borrowers (students and middle-class families) who have had wages improperly garnished will receive a rapid refund and additional compensation: the Department must return improperly garnished pay within 10 days and pay twice the amount.
Borrowers (students and middle-class families) with very old loans will be protected from ongoing wage garnishment by prohibiting garnishment for loans outstanding more than 10 years.
Borrowers (students and middle-class families) are less likely to suffer wrongful automated withholdings while system issues are fixed because automated garnishment is suspended until operational safeguards exist.
Taxpayers could face higher long‑term costs if temporarily suspended garnishment reduces collections and increases unpaid loan balances.
Borrowers' personal and employer data could be exposed or misused if the centralized database is compromised, increasing privacy and data‑security risks.
Small businesses and other employers face new liabilities and compliance burdens for processing garnishments, which could raise administrative costs or lead some employers to resist cooperating.
Based on analysis of 2 sections of legislative text.
Introduced May 14, 2025 by Cory Anthony Booker · Last progress May 14, 2025
Suspends the Department of Education’s administrative wage garnishment authority immediately upon enactment until the Secretary either certifies that certain operational protections are in place or elects to stop garnishing wages for individuals. The protections require quick refunds of improperly garnished pay, the ability to suspend or stop garnishments for individuals or groups, and quarterly employer verifications of contact and garnishment data. If the Secretary certifies implementation, the Department must create a centralized borrower/employer database and report regularly to congressional committees. Employers can be held liable for improper withholdings after notice; the Secretary must repay improperly garnished amounts (paying borrowers twice the actual amount within 10 days of receipt), and the Secretary is barred from garnishing wages on loans outstanding more than 10 years.