Commercial Law - Attachment of Wages - Exemptions (Exempt Income Protection Act)
Summary
HB393, the Exempt Income Protection Act, would expand the portion of a judgment debtor’s income that is protected from wage garnishment in Maryland. The bill changes the exemption formula so that the protected amount is the greater of 75% of disposable wages and certain benefits, or 150% of the federal poverty level for weekly income for a household of the debtor’s size, multiplied by the number of weeks the wages were earned. It also expressly includes Social Security, disability, and unemployment benefits in the wage exemption language and continues to protect medical insurance deductions from attachment.
The bill also adds a new notice requirement for employers served with an attachment. Employers/garnishees would have to notify the debtor in writing of the amount exempt from attachment, how the attachable wages were calculated, and how to contest the attachment under Maryland Rule 3-646. The bill is set to take effect July 1, 2025, and would amend provisions in the Commercial Law Article governing wage attachment and garnishment procedures.
Impact
HB393 would amend Maryland Commercial Law §§ 15-601.1 and 15-603 to broaden wage-garnishment exemptions and impose a new employer notice duty. In practice, creditors would be able to reach less of a debtor’s income, while employers would have an additional administrative obligation when served with an attachment. The bill would affect judgment debtors, judgment creditors, employers/garnishees, and the courts’ garnishment process, and it would align the exemption standard more closely with a federal poverty-level measure rather than the current minimum-wage-based formula.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or formal support/opposition in the materials supplied. Based on the bill’s purpose and structure, the measure appears consumer-protective and aimed at preserving more income for debtors facing garnishment, which typically draws support from debtor advocates and opposition or caution from creditor and collections interests. The bill text itself suggests a policy preference for stronger income protection and clearer notice to affected workers.
Contention
The likely points of contention are the size of the exemption increase and the shift from a minimum-wage-based threshold to a federal-poverty-level standard, which could significantly reduce the amount available to judgment creditors. Creditors, debt collectors, and some employers may object to reduced recovery and added compliance duties, while consumer advocates and debtors are likely to support the broader protections and required notice. Another possible issue is the inclusion of Social Security, disability, and unemployment benefits in the exemption language, which may be viewed as clarifying existing protections or expanding them depending on interpretation.