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revocation of Wage assignment

Ok, this is a little strange...I am in IL, today I recieved in the mail a letter from one of my employees stating that she is revoking a wage assignment that she has with First Cash Advance.
It was not notarized.
It appears that she also sent me a copy of the letter that she sent to them(First Cash) via certified mail.
Is something like this legal - can the employer be held liable if we recieve the wage assignment and don't withhold based on this???

I have no idea if she actually signed with them...

I have tried googling the law she is referring to and not coming up with anything...

16 444.2(a)(3)(i)

Thanks for any help on this.


  • Voluntary Wage Assignments are generally not binding on the employer. However IL is the one state that is often mentioned as an exception, where the state apparently passed rules making VMAs binding on the employer under certain circumstances. While I have have had IL employees I have never had an IL VMA. So I have always known that should I ever get one I would have to do some research, that evil day never came. For me anyhow. I would do the searches against the Illinois Wage Assignment Act.
  • Thanks for the Search tip...this is what I turned up.

    I am going to hazard a guess that her letter is only going to stop the initial attempt by them to collect the funds based on her signed collection agreement with them and that if they actually take her to court and get a court ordered wage assignment we are bound to withhold on that.

    Thanks David
  • In a more general note, I have always talked employers I have worked for to have a formal policy to not honor wage assignments unless legally required. It is very common for the Lender to claim legal requirements on the employer. IL (and maybe WI) are the only states I have ever found which had some support for their claims. The key is that these third party lenders lie their ***s of. Even in states with strange laws like IL, the lenders oversell their positions. In my experience, these places make use car sales people seems shining beacons on honesty in comparison.

    Never sign anything for a VWA lender. If you really are legally required to do something, there should be no need to sign something they wrote. At most I will send a letter I wrote acknowleding receipt of their document and agreeing to follow any actual laws on the subject.
  • my experience: the illinois wage assignment act is very specific on the wording in the original wage assignment the employee signed (so much so that they even call for correct font size)... copies have to be sent to employer, so many days in advance and via certified mail.... most of the time these rules aren't followed by the lendor which basically makes them null and void.

    it is however also very rare for an employee that signed a wage assignment for a crazy pay day loan to know that they can easily get out of it. usually i'll honor whatever is sent in up until the employee themself complains about it and revokes the wage assignment. this only happens about 1% of the time though.

    also my experience tells me that there isn't a real court in the state of illinois that will issue a court ordered garnishment based on a debt someone incurs as a result of a pay day loan. that being said, the employer is almost never held liable for not withholding wages.

    those places prey on the weak, but, IMO, just because they're preying on the weak doesn't mean the people that voluntarily accept 400% interest loans should get away with "free money"
  • edited January 9

    If there is a wage assignment, and it is paid, why do they continue to send more stating more money is due? Once a revocation letter is sent, what can they do next? They being the payday loan company? How can we make sure it is taken care of, and they mark it as paid in full and closed? (since the total amount on the contract plus some) is paid in full, but they continue to send notices for more monies are due? Just ridiculous.. @David Warren have there been any updated laws in the last few years?

  • To my knowledge, no, but I have not been keeping current.

    Keep it simple. Make the other side prove you are legally required to do something. If you really are, they will not mind doing so. In my experience, anyone who will not put their sources in writing is LYING.

  • Are you the employee or payroll admin? I would think the payday loan company would be adding late fees and interest for the whole time period that money is owed which is keeping the balance from $0? Has anyone asked for an accounting from the payday loan company? Don't know the legality, but did the employee ever close out or settle the matter for a specific amount to stop accruing more fees? Just one more reason to avoid payday loan companies....

  • The Payday Loan place can tell you to give them your kidneys, but legally the employer is not a party to the transaction unless the state has a law saying otherwise or the employer is stupid enough to sign something making them part of the transaction. This is an agreement between the employee and vendor. The employer is not (normally) a party to the agreement.

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