Attachment of Earnings
An Attachment of Earnings (AOE) is an Order from the Court which allows money to be deducted from wages or benefits and paid to the Court to meet a debt. You cannot have an AOE Order if you are self-employed, so there is likely to be alternative action taken against you. If a creditor has a County Court Judgment (CCJ) against you that isn’t being paid, they are legally allowed to enforce the judgment by asking the Court to grant an Attachment of Earnings.
The AOE prevents a creditor from enforcing the debt by using an Enforcement Agent (Bailiff), a Charging Order securing the date against your property, or a Third Party Debt Order with prior permission from the Court.
What is the Attachment of Earnings process?
You will be notified about the application for an Attachment of Earnings on form N55 and there will be an N56 attached. You only have 8 days to complete the form N56.
It is an offence to fail to respond to the N56 form. Enforcement Agents will serve an Order to complete the form and if it still isn’t done, you can be summonsed to Court and could face imprisonment for up to 14 days if you fail to attend.
To complete this, you will need to complete the following:
- Name, address and number of dependants
- Employer’s details
- Income & Expenditure
- Details of any other debts and Court orders you have and how much you are paying to each
- Make an affordable offer of payment to your creditor(s)
You can also ask for the AOE to be suspended if there is a chance it could result in loss of employment. There is a space on the N56 form for you to request this. This only applies though if the AOE hasn’t already been granted and the suspension is at the discretion of the Court.
If your take home pay is below a certain level, the Court cannot make an Attachment of Earnings order. This is known as the Protected Rate.
The rate is calculated by Court staff using pre-determined figures for essential expenditures such as housekeeping.
Will my AOE be granted straight away?
Both you and the creditors have 14 days from the date the AOE Order to object to its terms. Any appeal needs to be in writing and the hearing will be at your local Court by a District Judge.
What will my employer know?
Your employer will be told the full amount outstanding under the County Court Judgment and the rate to be deducted. Your employer also has to right to charge a fee of £1 for every deduction they have to make for the AOE to cover their admin costs. Some employers may have a policy of dismissing employees if they have any legal action against them. You should check your contract of employment to see if this applies to you.
The creditor cannot apply directly to your employer but they are allowed to provide the employer’s details to the Court. The Court will then contact the employer to ask for details of your earnings if you don’t return the N56 form.
Deductions for some debts are at fixed rates. This particularly applies in the case of an AOE for Council Tax arrears. Depending on whether you are weekly or monthly paid:
- £200 net weekly pay would be a 7% deduction rate
- £1,500 net monthly pay would be a 17% deduction rate
What if I have more than one Attachment of Earnings Order?
If you have an AOE and other County Court Judgments (CCJ’s) you can apply to have a Consolidated AOE Order. This would mean you would have one monthly payment deducted by your employer and sent to the Court to cover all CCJ’s. You can apply for this on Form N244 which in this case would not require an upfront fee but the Court would deduct 10p for every £1 paid in whilst the Consolidated Order is in place.
Can payment amounts be changed?
In most cases the payments can be varied by applying on Form N244, for which there is a fee, if your circumstances have changed and you are no longer able to afford the deductions. You will need to complete an Income & Expenditure and explain why the deductions are no longer affordable.
What happens if I leave my job?
The AOE deductions will stop when you leave your job but the AOE is still in force and the debt still exists. You must notify the Court as soon as you get a new job. Failure to do so in an offence and you could be fined or sent to prison. If the creditor stops receiving the payments but believes you are working, they can ask the Court to order you to submit an Income & Expenditure to the Court or summon you to a Court hearing.