New York State DOL Issues Regulations on Payroll Debit Cards
September 19, 2016On September 7, 2016, the New York State Department of Labor adopted regulations governing the payment of employee wages by any method other than cash or check, including direct deposit and payroll debit cards. The purpose of the new rules, which will become effective on March 7, 2017, is to ensure that workers who are paid via payroll debit cards have access to their wages in full without being subjected to hidden fees. At least seven business days before taking action to pay employees via payroll debit cards, employers must satisfy certain notice requirements and obtain employees’ informed consent. For example, employers must provide employees with:
- a plain language description of all of the employee’s options for receiving wages;
- a statement that the employer may not require the employee to accept wages by payroll debit card or direct deposit;
- a statement that the employee may not be charged for any fees for services that are necessary for the employee to access his/her wages in full; and
- if offering the option of payroll debit cards, a list of locations of fee-less ATMs within a reasonable travel distance from the employee’s workplace or residence (a link to a website containing such information is sufficient).
- have access to at least one (1) fee-less ATM within a reasonable travel distance from where the employees work or live;
- have access to unlimited withdrawals from a fee-less ATM; and
- not incur fees for: checking their balance; maintenance; account inactivity; overdraft; contacting customer service; receiving written statements or transaction histories; closing an account; card replacement (at reasonable intervals); taking action necessary to receive wages or hold the payroll debit card; or point of sale transactions.