By Cathy Beyda, ESQ.
Three states have enacted legislation addressing payroll cards so far in 2015. Georgia and Rhode Island now expressly recognize the use of payroll cards in their wage payment statutes. Florida has recognized the use of payroll cards for most employees since 2009. A recent amendment makes clear that payroll cards may be used by labor pools to pay day laborers.
Georgia Senate Bill number 88 became effective May 5, 2015. Under the new law, employers who offer payroll cards must provide their employees with a written explanation of any fees associated with the payroll card account together with a form that may be used to opt-out of the payroll card program. The opt-out form must allow the employee to designate an account and authorize direct deposit or, at the employee’s election, request a paper paycheck. An employer must provide the written explanation of fees and opt-out form to employees at least 30 days before it first begins offering payroll cards. After initial implementation, the forms must be provided at the time of hiring. In addition, the employer must make the opt-out form available to employees at all times.
Rhode Island House Bill number 5590 became effective July 15, 2015. The new law allows employers to pay their employees using payroll cards with the employee’s written or electronic consent. In most instances, the employee must be able to make at least one withdrawal from the payroll card account each pay period without charge for any amount up to the employee’s net wages for the pay period. If the employee is paid more frequently than weekly, however, the employee must be able to make at least one withdrawal each week without charge for up to the employee’s full wages for the week. Employees also must be provided a way to check their account balance without charge, either using an automated telephone system or over the internet.
Earlier this year, Florida enacted legislation authorizing labor pools to pay day laborers using payroll cards if direct deposit is also offered and other conditions are met. Senate Bill number 456 became effective July 1, 2015.