• The CCPA is divided into six subchapters, and employers will want to focus on II and III.

The Consumer Credit Protection Act of 1968 (CCPA) requires creditors to state the cost of borrowing in a common language so that average consumers can figure out what the charges are, compare costs, and shop for the best credit deal.

Since 1968, credit protections have multiplied. Generally, the Act:

• Ensures consumers are told the cost of borrowing,
• Prohibits unfair discrimination in credit transactions,
• Ensures consumers are told why credit is denied,
• Allows consumers access to credit records,
• Provides a way to settle billing disputes, and
• Reduces credit problems and confusion.

The CCPA is currently divided into six subchapters:

• Subchapter I: Consumer Credit Cost Disclosure
• Subchapter II: Restrictions on Garnishment
• Subchapter III: Credit Reporting Agencies
• Subchapter IV: Equal Credit Opportunity
• Subchapter V: Debt Collection Practices
• Subchapter VI: Electronic Fund Transfers

Employers will want to focus on Subchapters II and III.

Wage garnishment

Subchapter II of the Act:

• Protects employees from discharge by their employers because their wages have been garnished for any one debt, and
• Limits the amount of an employee’s earnings that may be garnished in any one week.

Subchapter II applies to all employers and individuals who receive earnings for personal services, including:

• Wages,
• Salaries,
• Commissions, and
• Bonuses and income from a pension or retirement program.

Tips are ordinarily not included.

Consumer reports

Subchapter III of the Act, also known as the Fair Credit Reporting Act (FCRA), protects individuals by requiring consumer reporting agencies providing information to adopt procedures that promote:

• Confidentiality
• Accuracy
• Relevancy
• Proper use of information

Subchapter III affects employers and consumer reporting agencies.