Congress passed the CARES Act (the Coronavirus Aid, Relief, and Economic Security Act) back in March. The $2.2 trillion federal law automatically suspended principal and interest payments on federal student loans through September 30, 2020. This act includes suspending wage garnishment, which is when the court orders your employer to take a percentage out of your paycheck to pay off your debts, something common with student loans. However, even with the chaos that the coronavirus pandemic brought on the economy, the Education Department is under heat for allegedly not following through.
Elizabeth Barber, a home health aide, is the lead plaintiff in a class action lawsuit against Education Secretary Betsy Devos. She, along with other student advocacy groups, Student Defense, and the National Consumer Law Center (NCLC), are suing the Secretary of Education for allegedly continuing to collect garnished wages of student borrowers, despite the passing of the CARES Act. The Department of Education is allowed to withhold up to 15% of wages of those in student debt, so the lawsuit is demanding that the Education Department cease doing so.
On April 16, Senator Cory Booker and Representative Ayanna Pressley, along with 40 other Congress members, sent a letter to the Secretary of Education, demanding that the Department of Education stop collecting federal student loan debt from garnished wages and to let the student borrowers who were affected know when they can receive their refunds.
Elizabeth Barber makes $12.36 an hour as a home health aide and has been working fewer hours because of the coronavirus pandemic. Her argument comes from the Education Department still taking parts of her paycheck to go to her student loans, despite the passing of the CARES Act. The NCLC have also backed up Barber’s claims by mentioning that they have been receiving many of the same complaints similar to Barber’s.
From Day 1, we’ve prioritized getting #CARESAct funding quickly into the hands of those who need it most. Ahead of schedule, we’ve made almost $31B available for students, schools, states and local leaders to use to ensure needs are met and learning continues for all students. pic.twitter.com/5bbSmQBN30
— Secretary Betsy DeVos (@BetsyDeVosED) May 1, 2020
In a statement, Persis Yu, director of the NCLC, said, “Right now, low-wage workers hit hardest by the economic impact of the pandemic need their paychecks to keep food on the table and a roof over their heads.” However, Education Department spokeswoman Angela Morabito argued back, explaining that the department is in the process of notifying employers to stop the wage garnishment.
Although the Department of Education hasn’t commented specifically on this class action lawsuit, they apparently are committing to processing the refunds of those whose wages have already been garnished. Morabito continued to explain, “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.”
With Trump and the federal government passing a couple of federal laws to alleviate the economical stress that the coronavirus pandemic put on the country, it seems completely counterproductive for a federal department to be continuing to collect wages regardless. Maybe it is taking the Department of Education a little longer to enforce the CARES Act, but I think it’s ridiculous that after almost two months of this issue, student borrowers are still having struggles like Elizabeth Barber.
I can only hope that any good thing that could possibly come out of this coronavirus pandemic will be a reset of everything, including government. I believe this pandemic is exposing the loopholes that have been needing fixing.