Student Advocates Sue Education Dept. for Wage Garnishments in Loan Defaults
May 4, 2020 by Tom Ramstack
The campus of Georgetown University. (Photo by Dan McCue)
WASHINGTON – Higher education advocacy groups are suing the U.S. Education Department for continuing to garnish the wages of persons who default on student loan payments during the coronavirus epidemic.
Education Secretary Betsy DeVos announced March 25 her department would suspend the wage garnishments while a big swath of the U.S. economy shut down and unemployment skyrocketed.
The National Student Defense Legal Network, with support from the National Consumer Law Center and the Student Borrower Protection Center, says in a lawsuit filed last week that the garnishments have not stopped.
Their class action lawsuit accuses DeVos and the Education Department of violating the Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act.
President Trump signed the CARES Act into law March 27 as a $2 trillion economic stimulus measure to help the nation's economy withstand devastation from the coronavirus shutdown. It was part of a federal policy that also sought to halt evictions, foreclosures and student debt collections for at least six months.
"Despite the department's announcement that it had stopped wage garnishments, and despite the department's notice to student loan borrowers that it had done the same, the department, more than a month into the six-month emergency suspension period, continues to seize wages from distressed federal student loan borrowers," the lawsuit filed in the U.S. District Court for the District of Columbia says.
In 2018, the Education Department reported that it garnished more than $840 million from borrowers with federal Direct Loans.
The lawsuit uses the example of Elizabeth Barber, a 59-year-old home health aide who earns $12.89 per hour. She owes about $10,000 on student loans after studying psychology at Nazareth College.
Her hours for an assisted home care company in Rochester, N.Y., have been reduced during the pandemic, making it difficult for her to pay routine debts. She is in default on her student loan.
She cares for patients with cerebral palsy who need extensive assistance with personal care.
"As Ms. Barber continues to assist clients in need, the [Education] Department—in violation of the CARES Act—continues to garnish approximately 12% of her paychecks," the lawsuit says. "Most recently, the Department illegally garnished $70.20 from her April 24, 2020 paycheck."
She is suing on behalf of about 285,000 student loan borrowers whose wages are being garnished, the lawsuit says.
The Education Department declined to comment on the litigation. However, a statement from the department said it has taken immediate action to notify employers to stop garnishing wages for student loan defaults.
"The department's default loan servicer called employers by phone, sent emails when possible, and mailed letters to employers who could not be reached any other way," the statement says. "Payments we receive via garnished wages will be immediately processed for refund, and the employer will be contacted again to ensure the guidance to stop garnishing wages is understood. The department relies on employers to stop garnishing wages, but is taking every measure to contact employers and refund garnished wages to borrowers until Sept. 30, 2020."
The consumer advocacy groups that are suing say the Education Department's response is inadequate.
The department's pledge to refund garnished wages is likely to take months at a time some borrowers are becoming desperate because of high unemployment.
One of them is the lead plaintiff in the class action lawsuit, the consumer advocates say.
"Ms. Barber is struggling to make ends meet, so every dollar counts as she tries to meet her immediate needs," the lawsuit says.
"Ms. Barber often has to leave bills unpaid in order to cover her basic needs. She has no money in her checking or savings accounts, is in arrears on various local taxes, and is subject to a lien on her home," the lawsuit says. "She is also past due on both her water and electric bills, which she cannot afford to pay in full each month. As her past due amounts continue to grow, the decrease in hours due to COVID-19 has magnified Ms. Barber's financial struggles."
The plaintiffs ask the federal court to invoke authority under the Administrative Procedures Act to "hold unlawful and set aside agency action . . . found to be . . . arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law."
In other words, they want the wage garnishments stopped.The case is Barber v. DeVos, U.S. Dist.Ct. – D.C. Case No. 20-cv-1137, filed April 30, 2020.
Betsy DeVos
loan defaults
Jerry McNerney
McNerney to Bid House Adieu After 2022
AT&T, Verizon to Delay 5G Rollout Near Airports
Police stand in front of the Congregation Beth Israel synagogue, Sunday, Jan. 16, 2022, in Colleyville, Texas. (AP Photo/Brandon Wade)
FBI Warns of More Threats Against Religious Groups
President Joe Biden speaks about the government's COVID-19 response, in the South Court Auditorium in the Eisenhower Executive Office Building on the White House Campus in Washington, Thursday, Jan. 13, 2022. (AP Photo/Andrew Harnik)
White House Announces Plans to Distribute Home COVID Tests
Three elderly men wearing FFP2 face masks to curb the spread of the coronavirus, sit on a bench in Athens, Greece, Monday, Jan. 3, 2022. (AP Photo/Thanassis Stavrakis, File)
Mask Rules Get Tighter in Europe in Winter's COVID-19 Wave
Vaccination (Photo by Pfc. Maxwell Bass; 24th Theater Public Affairs Support Element)
House Rules Committee Rejects G.I. Bill Education Benefits for Vaccine Refusal
Senate Majority Leader Chuck Schumer, D-N.Y., speaks to the media after Senate Democrats met privately with President Joe Biden, Jan. 13, 2022, on Capitol Hill in Washington. (AP Photo/Jose Luis Magana, File)
'Eye of Nation Watching' as Voting Rights Bill Appears Headed for Defeat
President Joe Biden speaks in support of changing the Senate filibuster rules that have stalled voting rights legislation, at Atlanta University Center Consortium, on the grounds of Morehouse College and Clark Atlanta University, Tuesday, Jan. 11, 2022, in Atlanta. (AP Photo/Patrick Semansky)
Voting Rights and Fate of the Filibuster Set Senate Showdown on Capitol Hill
A Digital Divide Haunts Schools Adapting to Virus Hurdles
by A Digital Divide Haunts Schools Adapting to Virus Hurdles
When April Schneider's children returned to in-person classrooms this year, she thought they were leaving behind the struggles from more... Read More
When April Schneider's children returned to in-person classrooms this year, she thought they were leaving behind the struggles from more than a year of remote learning. No more problems with borrowed tablets. No more days of missed lessons because her kids couldn't connect to their virtual... Read More
In The States
School Year Delays, Virtual Learning Instituted Amid COVID-19 Spike
by Reece Nations
SAN ANTONIO — COVID-19 infection rates continue to complicate the school year as some districts have either delayed their start... Read More
SAN ANTONIO — COVID-19 infection rates continue to complicate the school year as some districts have either delayed their start dates or shifted to virtual learning in response to the growing spike in cases. As many schools nationwide have either moved to online teaching or pushed... Read More
School District Works to Implement Test-to-Stay Practice
by Alexa Hornbeck
SHAWNEE, Kan. — Members of the Shawnee Mission School District in Kansas implemented changes to their test-to-stay practice this week,... Read More
SHAWNEE, Kan. — Members of the Shawnee Mission School District in Kansas implemented changes to their test-to-stay practice this week, based on new guidance supported by the Biden administration and Centers for Disease Control and Prevention, on using the method to reduce the spread of COVID-19... Read More
Proof of Negative COVID Test a Back-to-School Essential in DC
by Dan McCue
WASHINGTON — All students and staff planning to return to the District of Columbia's public schools after their holiday break... Read More
WASHINGTON — All students and staff planning to return to the District of Columbia's public schools after their holiday break must first provide proof of a negative COVID-19 test, Mayor Muriel Bowser and schools chancellor Lewis Ferebee announced Wednesday. School is set to resume in the... Read More
White House Extends Student Loan Repayment Freeze
WASHINGTON — The Biden administration on Wednesday extended a freeze on student loan repayments to May 1. Borrowers' payments were... Read More
WASHINGTON — The Biden administration on Wednesday extended a freeze on student loan repayments to May 1. Borrowers' payments were to resume in February. The so-called administrative forbearance was initially put in place as part of the CARES Act in March 2020 and was later extended... Read More
Scholars Say COVID Represents 'Teachable Moment' for Girls' Education in Crisis
by Kate Michael
WASHINGTON — With the pandemic just one crisis affecting girls' education globally, the Brookings Institution gathered a group of young... Read More
WASHINGTON — With the pandemic just one crisis affecting girls' education globally, the Brookings Institution gathered a group of young scholars from around the world for a symposium to consider new ways to protect and promote the rights of women, especially in times of crisis. While... Read More
News From The Well
Submit Op-Ed
© 2022 The Well News™, LLC. All rights reserved.