Generally, a wage garnishment is a mechanism to enforce a judgment (or pre-judgment attachment) from some other legal action. To stop the garnishment from occuring (in this context and with future employers), you must either challenge the underlying judgment, successfully defend the action for which pre-judgment attachment was allowed, or contact the creditor who sued you and work out some sort of settlement or payment plan. Otherwise, the garnishment will likely continue.
Severance pay can be structured as "wages," in which case they are subject to garnishment. It can also, by agreement of the parties, be deemed a settlement of non-wage claims (such as any claims you might have for discrimination, retaliation, or harassment, for example). If you and your employer did not agree to designate the severance pay as some form of non-wage payment, your employer likely decided to play it safe by deeming the payment wages. This is in their best interests, as it ensures they are complying with income reporting and tax withholding regulations. It was also safest for them to honor the garnishment.
In sum, unless something was wrong with the underlying judgment that led to the garnishment, there likely is not much you can do to stop it. I will say, if you were not aware, that you can be eligible for unemployment benefits even while you earn a severance package. This is because unemployment benefits are provided for pay periods where you are not earning any new income, and technically a severance package is compensation you earned during your employment even though it is received after that employment ends. This may be a stop-gap measure you can take to assist with the difficult financial times it sounds like you are facing.
Good luck to you,
The information provided in this Answer is offered for educational purposes only and should not be construed as legal advice or counseling. You should not rely on the information herein in assessing your legal rights, determining to take legal action, in any formal papers filed in a legal or administrative forum, or in any way whatsoever. Moreover, this Answer does not create an attorney-client relationship - only the formal, written agreement required by the State Bar of California can do that. You should always have a full consultation with a lawyer if you are contemplating any sort of legal action.
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