§ 22-2-6-2 — Assignment of wages; requisites

Indiana § 22-2-6-2

• Jurisdiction: Indiana
• Art. 2: WAGES, HOURS, AND BENEFITS
• Ch. 6: Wage Deductions

Text

(a) Any assignment of the wages of an employee
is valid only if all of the following conditions are satisfied:
(1) The assignment is:
(A) in writing;
(B) signed by the employee personally;
(C) by its terms revocable at any time by the employee upon
written notice to the employer; and
(D) agreed to in writing by the employer.
(2) An executed copy of the assignment is delivered to the
employer within ten (10) days after its execution.
(3) The assignment is made for a purpose described in subsection
(b).
(b) A wage assignment under this section may be made for the
purpose of paying any of the following:
(1) Premium on a policy of insurance obtained for the employee
by the employer.
(2) Pledge or contribution of the employee to a charitable or
nonprofit organization.
(3) Purchase price of bonds or securities, issued or guaranteed by
the United States.
(4) Purchase price of shares of stock, or fractional interests in
shares of stock, of the employing company, or of a company
owning the majority of the issued and outstanding stock of the
employing company, whether purchased from such company, in
the open market or otherwise. However, if such shares are to be
purchased on installments pursuant to a written purchase
agreement, the employee has the right under the purchase
agreement at any time before completing purchase of such shares
to cancel said agreement and to have repaid promptly the amount
of all installment payments which theretofore have been made.
(5) Dues to become owing by the employee to a labor
organization of which the employee is a member.
(6) Purchase price of merchandise, goods, or food offered by the
employer and sold to the employee, for the employee's benefit,
use, or consumption, at the written request of the employee.
(7) Amount of a loan made to the employee by the employer and
evidenced by a written instrument executed by the employee
subject to the amount limits set forth in section 4(c) of this
chapter.
(8) Contributions, assessments, or dues of the employee to a
hospital service or a surgical or medical expense plan or to an
employees' association, trust, or plan existing for the purpose of
paying pensions or other benefits to said employee or to others
designated by the employee.
(9) Payment to any credit union, nonprofit organizations, or
associations of employees of such employer organized under any
law of this state or of the United States.
(10) Payment to any person or organization regulated under the
Uniform Consumer Credit Code (IC 24-4.5) for deposit or credit
to the employee's account by electronic transfer or as otherwise
designated by the employee.
(11) Premiums on policies of insurance and annuities purchased
by the employee on the employee's life.
(12) The purchase price of shares or fractional interest in shares
in one (1) or more mutual funds.
(13) A judgment owed by the employee if the payment:
(A) is made in accordance with an agreement between the
employee and the creditor; and
(B) is not a garnishment under IC 34-25-3.
(14) The purchase, rental, or use of uniforms, shirts, pants, or
other job-related clothing at an amount not to exceed the direct
cost paid by an employer to an external vendor for those items.
(15) The purchase of equipment or tools necessary to fulfill the
duties of employment at an amount not to exceed the direct cost
paid by an employer to an external vendor for those items.
(16) Reimbursement for education or employee skills training.
However, a wage assignment may not be made if the education or
employee skills training benefits were provided, in whole or in
part, through an economic development incentive from any
federal, state, or local program.
(17) An advance for:
(A) payroll; or
(B) vacation;
pay.
(18) The employee's drug education and addiction treatment
services under IC 12-23-23.
(c) The interest rate charged on amounts loaned or advanced to an
employee and repaid under subsection (b) may not exceed the bank
prime loan interest rate as reported by the Board of Governors of the
Federal Reserve System or any successor rate, plus four percent (4%).
(d) The total amount of wages subject to assignment under
subsection (b)(14) and (b)(15) may not exceed the lesser of:
(1) two thousand five hundred dollars ($2,500) per year; or
(2) five percent (5%) of the employee's weekly disposable
earnings (as defined in IC 24-4.5-5-105(1)(a)).
(e) Except as provided under 29 CFR Parts 1910, 1915, 1917, 1918,
and 1926, an employee shall not be charged or subject to a wage
assignment under subsection (b)(14) or (b)(15) for protective
equipment including personal protective equipment identified under 29
CFR Parts 1910, 1915, 1917, 1918, and 1926.
Formerly: Acts 1945, c.183, s.2; Acts 1947, c.330, s.1; Acts
1963, c.148, s.1; Acts 1975, P.L.251, SEC.1. As amended by
P.L.143-1988, SEC.3; P.L.115-1994, SEC.1; P.L.83-2001, SEC.1;
P.L.193-2015, SEC.2; P.L.136-2018, SEC.110; P.L.195-2018, SEC.10;
P.L.147-2019, SEC.1.