Is it legal for an employer to take your whole paycheck for money you owe to him from a personal loan or a cash advance?

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Is it legal for an employer to take your whole paycheck for money you owe to him from a personal loan or a cash advance?

I recently quit the job to take another job.

Asked on August 18, 2015 under Employment Labor Law, Iowa

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, your employer has no right to take your paycheck--in whole or in part--unless you consent to let them do so so, for example, money withheld to pay for benefits or as required by law taxes court-ordered wage garnishment. Even if you owe the employer money, they can't take your pay except as described above. 
You could sue them for the money they withheld from you. In the lawsuit, however, they could countersue you for the money they say you owe them--which means that end of the day, if you do owe them the money, you may not net out ahead, because one way or another, they have the right to the money if you had a loan but failed to repay it. So if you do owe them amount equal to what they withheld, suing them may not actually get you anything, even though legally, they were wrong to withhold the money.


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