Attachment of earnings orders: how to process them
An Attachment of Earnings Order (AEO) is a court order requiring an employer to deduct a specified amount from an employee's wages and pay it directly to a creditor or the court. Employers are legally obliged to comply when they receive a valid AEO. Failing to do so is a contempt of court, and the employer can be held liable for the amounts that should have been deducted.
There are several types of AEO in England, Wales, and Scotland, each with different rules:
County Court AEO — the most common type, issued in relation to a civil debt. The order specifies a Normal Deduction Rate (the amount to deduct each period) and a Protected Earnings Rate (below which the employee's net pay cannot fall). If net pay in any period falls below the protected earnings rate before the deduction is taken, the deduction is not made that period.
Fines enforcement AEO — issued by the magistrates' court for unpaid fines. These take priority over county court AEOs. The protected earnings rate may differ.
Council Tax AEO — issued by local authorities for unpaid council tax. These do not have a fixed deduction rate in the same way — the employer and local authority may agree the amount, or the order may specify a percentage of earnings.
Child Support Deductions Order — issued by the Child Maintenance Service, these require deductions for unpaid child maintenance. Priority is above most other AEOs.
Earnings Arrestment (Scotland) — the Scottish equivalent of an AEO. Different rules apply north of the border, including a different schedule of deduction rates based on earnings bands.
Where multiple AEOs are received for the same employee, the order of priority matters. Child support deductions take highest priority. Fines enforcement AEOs come next. County court AEOs rank below these and below each other in chronological order.
Here is the practical process for handling an AEO:
1. Verify the order is valid — check it is addressed to your organisation and names the employee correctly.
2. Write to the employee to confirm you have received the order (this is required under most AEO types).
3. Calculate the deduction for each pay period — applying the normal deduction rate unless protected earnings would be breached.
4. Deduct the amount and pay it to the court or creditor as instructed by the order.
5. Keep records of each deduction and each payment.
6. If the employee leaves, notify the court within 10 days and return any undistributed deductions.
Employers are entitled to an administrative fee per deduction — currently £1.00 per deduction for county court AEOs. This is deducted from the employee's wages on top of the court-ordered amount, though it is capped and cannot reduce pay below protected earnings.
See our PAYE plain English guide for how AEO deductions sit within the broader payroll deduction sequence, and payroll errors: how to correct them before HMRC notices for handling errors in AEO processing.
Mellow handles AEO deductions within the payroll run, applying the correct priority order and protected earnings calculation. [See Mellow pricing →](https://mellowhr.com/pricing)