As a business owner or a business manager there are several pitfalls that frequently get a person in your position into trouble. While these are easily avoidable, the consequences of falling victim to these pitfalls can be expensive. Read on and avoid becoming a victim.

Don’t Ignore that Garnishment served on your business

If you have been served with a garnishment on your employee’s wages, DO NOT IGNORE IT. You must respond to the garnishment within 14 days or a judgment will be entered against your business. The garnishment is a lawsuit by the creditor against the business or business owner. Take a moment and fill out the enclosed response form and follow the instructions. If you have questions about what you are supposed to do, call your lawyer and she can help you. Your failure to file a response will subject you to a judgment for the full amount that your employee owes the creditor.

Don’t fire the employee that is being garnished

Be aware that you may not fire your employee because his wages were garnished. If he can prove that you terminated his employment because of the wage garnishment, he can sue you and collect damages and attorneys’ fees. It’s a crazy world, right? Don’t be a victim of the craziness.

Review your accounts receivable aging schedule frequently

A customer that begins to experience cash flow problems will usually take longer and longer to pay. Your aging schedule is a perfect indicator of which of your customers is getting into trouble. If your customer ultimately goes out of business, you do not want it going out of business with the money it owes you. One of the best tools that you have to gage your clients’ financial liquidity is to review your accounts receivable aging schedule frequently.

Call your customers that are not paying on time

If after you have reviewed your accounts receivable aging schedule, you develop a concern about a customer’s financial stability, then call the customer. That customer is holding your money. You have a right to inquire as to how their business is doing. If your customer is having a problem paying your bills on time, then consider putting that customer on a C.O.D. basis for new goods or services and making a payment arrangement on the balance.


None of these issues is intuitive. There are pitfalls for the unwary business owner. The price of ignorance can be high. Be aware of the principals that are discussed in this article and don’t be a victim.

Kevin M. Taylor is an attorney that specializes in debt collection. He is the founder of Kevin M. Taylor, P.C., Collection Attorneys. Kevin M. Taylor, P.C. has been collecting debts for large and small business for the past 15 years. Kevin M. Taylor, P.C. is at 24901 Northwestern Hwy #306, Southfield, MI 48075. For more information call (248) 223-1999 or visit us at www.creditor-law.com.