What is an Earnings Arrestment?

What is an Earning Arrestment?

In Scotland, an earning arrestment, (also known as a wage arrestment), is a form of diligence.

Diligence is a Scottish legal term for procedures that are used to recover debts.

What an earning arrestment does, is it allows your creditors, the people you owe money to, to recover that money by forcing your employer to deduct it from your wages, usually on a daily or monthly basis.

Your employer has no choice but to comply with the order, if it is served on him by a sheriff officer, but he can only deduct certain amounts from your wages and cannot leave you without any money.

Normally, an earning arrestment continues until such time the debt is paid off, which would include paying off any interest and legal costs your employer has incurred in trying to recover the debt from you.

It can sometimes be possible to get an earning arrestment stopped before the debt is repaid in full. To find out more about this see Formal Debt Solutions.

How do Earning Arrestments work?

Before a sheriff officer can execute an earning arrestment, however, they must first ensure the creditor has met the necessary legal requirements enabling them to do so. This means they must first have obtained a court order or its equivalent, or have a document of debt that provides them with a warrant to recover their debt using an earning arrestment.

A court order is an order granted by the Sheriff in the Sheriff Court, although it can also be granted by the Court of Session. The legal equivalent of a court order, a Summary Warrant, is also granted by the Sheriff Court for certain types of Government debts, such as council tax, owed to local authorities; or income tax, owed to HMRC.

A document of debt is more complex, but certain creditors like landlords and credit unions can register debts for what is known as preservation and execution in the Books of Council and Session. This allows them to legally recover debts using a sheriff officer, without going to court.  However, for them to do this you need to give them permission when you enter into the original agreement you had with them and which the debt arose from. This is not an option open to credit card companies and banks.

Prior to instructing a sheriff officer to execute an earning arrestment, a creditor first must instruct them to serve what is known as a charge for payment. This is a legal demand for payment that is served by a sheriff officer. It gives you 14 days to pay your debt in full. If you fail to pay the debt within the 14 days, the lender is then in a position where he can instruct the sheriff officer to arrest your earnings.

Practical Considerations of Earning Arrestments

There are many practical considerations that a lender must take into consideration before they execute an earnings arrestment. The first of these is, he must know where you work. If he does not know where you work, sheriff officers will obviously struggle to serve the schedule on your employer.

Even if they do know where you work, another practical consideration is whether the arrestment will be successful, in that you may not earn enough for any deductions to be made from your earnings. 

Finally, a creditor incurs legal costs in executing an earnings arrestment, which they may lose if you later choose to use an option like sequestration.  For these reasons, most creditors will only take the risk of executing an earning arrestment if they feel all other options have been explored and exhausted.

How much can your employer take from your wages?

Earning Arrestment Schedule

Table A - Deductions from Weekly Earnings

Net Earnings Deductions(*)
Not exceeding £113.68 Nil
Exceeding £113.68 but not exceeding £410.90 £4 or 19% of earnings exceeding £113.68, whichever is the greater
Exceeding £410.90, but not exceeding £617.82 £56.47 plus 23% of earnings exceeding £410.90
Exceeding £617.82 £104.06 plus 50% of earnings exceeding £617.82
  (*) When applying a percentage the calculation should be done to two decimal places of a penny and the result rounded to the nearest whole penny, with an exact half penny being rounded down.

Table B - Deductions from Monthly Earnings

Net Earnings Deductions(*)
Not exceeding £494.01 Nil
Exceeding £494.01 but not exceeding £1,785.61 £15.00 or 19% of earnings exceeding £494.01, whichever is the greater
Exceeding £1,785.61 but not exceeding £2,684.51 £245.40 plus 23% of earnings exceeding £1,785.61
Exceeding £2,684.51 £452.15 plus 50% of earnings exceeding £2,684.51
    (*) When applying a percentage the calculation should be done to two decimal places of a penny and the result rounded to the nearest whole penny, with an exact half penny being rounded down.

Table C - Deductions from Daily Earnings

Net Earnings Deductions(*)
Not exceeding £16.24 Nil
Exceeding £16.24 but not exceeding £58.70 £0.50 or 19% of earnings exceeding £16.24, whichever is the greater
Exceeding £58.70 but not exceeding £88.26 £8.07 plus 23% of earnings exceeding £58.70
Exceeding £88.26 £14.87 plus 50% of earnings exceeding £88.26
  (*) When applying a percentage the calculation should be done to two decimal places of a penny and the result rounded to the nearest whole penny, with an exact half penny being rounded down.