Authored by Caitlin Ladd
Are you paying employees by way of payroll cards? Are you considering implementing a payroll card program? As this payroll practice becomes more prevalent, legislators and plaintiffs’ attorneys are contending that such programs violate state and federal wage payment laws, focusing on employee authorization and excessive fees. Just this month, the Consumer Financial Protection Bureau issued a warning reminding employers that, among other things, payroll card programs must be entirely voluntary and emphasized the need for clear and complete disclosure of all associated fees. Spurred by the popular press and a putative class action in Pennsylvania involving a fast-food franchise, states agencies also have the topic on their radars. For example, the New York Attorney General is currently seeking exploring employer payroll card programs, having recently issued investigative letters and subpoenas to employers throughout the state. For best practice tips, check out Seyfarth Shaw’s Employment Law Lookout blog to read through Payroll Debit Cards: Paperless Problem Solver or Putative (Class Action) Pitfall?