Client Alert: New Payroll Card Rules
Effective January 1, 2015 new rules apply to employers who wish to pay their employees with a payroll card.
What stays the same:
If you are not paying by cash (yes, that still works) or by check YOU MUST get the employee’s written direction to pay by direct deposit or payroll card.
What is new:
If you pay by payroll card there are many specific rules. The following are some highlights:
- You can’t offer employees anything to entice them to sign up for payroll card payments
- You have to provide employees with a written disclosure that includes, among other requirements, a list of all the fees that may be assessed on the card
- A method to access full net wages must be provided each pay period (or at least twice if paid monthly) at no cost to the employee, at a location readily available to the employee
The new rules are much more detailed. If in addition to offering a check and direct deposit you wish to offer a payroll card or would like your current payroll card program reviewed, contact one of our Compensation & Employment attorneys.