Peonage Law and Legal Definition

Peonage is a condition in which debtors are bound in servitude to their creditors until their debts are discharged. It is a status of compulsory service, based upon the indebtedness of the peon to the master. The basal fact is indebtedness. [Clyatt v. United States, 197 U.S. 207, 215 (1905)].

The following is an example of a federal statute defining the term:

According to 42 USCS § 1994, 'peonage' is defined as "a condition of enforced servitude by which the servitor is compelled to labor against his will in liquidation of some debt or obligation, either real or pretended." The holding of any person to service or labor under the system known as peonage is abolished and forever prohibited in any Territory or States of the United States.