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foghead
01-25-2007, 03:31 PM
I resigned from my job and gave my employer two weeks notice. They want to issue my final pay in the form of a paycard (like a debit card). I asked for a live check or direct deposit, and was informed that those aren't options. HR says I have to take the paycard. My question is: Am I legally obligated to take the pay in the form of the paycard? Do I have the right to insist on a check or direct deposit? The employer is based in Dallas, but the office where I work is in California.

Villain
01-25-2007, 08:21 PM
No do not take the paycard. You must be issued a check or cash

cbg
01-25-2007, 10:07 PM
Villain, I'm not arguing with you, but do you have a cite for that? Not saying you're wrong; just for my own personal information. :)

Villain
01-26-2007, 06:35 AM
Payments must be made with a negotiable instrument without discount. Are you suggesting that a paycard is a legal form of payment?

cbg
01-26-2007, 07:01 AM
No, I said I wasn't arguing with you. I'm asking a question.

ScottB
01-26-2007, 07:13 AM
Are you suggesting that a paycard is a legal form of payment?

I would. I would love to start paying folks that don't elect direct deposit by paycard. We were talking to one vendor about this, but I guess we were too small to interest them.

Anyway, from the California Labor Code:

213. Nothing contained in Section 212 shall:
(d) Prohibit an employer from depositing wages due or to become due or an advance on wages to be earned in an account in any bank, savings and loan association, or credit union of the employee's choice with a place of business located in this state, provided that the employee has voluntarily authorized that deposit.

So California employees must give their assent to direct deposits. My thought would be that this would hold true for payment into a paycard.

Villain
01-26-2007, 07:17 AM
No, I said I wasn't arguing with you. I'm asking a question.
Fair enough. Labor Code section 212 (http://www.leginfo.ca.gov/cgi-bin/waisgate?WAISdocID=82084927144+0+0+0&WAISaction=retrieve). The only way I see a paycard being legal form of payment is if there is some ATM out there which does not assess a fee for withdrawing money from said card.

Villain
01-26-2007, 07:21 AM
I would. I would love to start paying folks that don't elect direct deposit by paycard. We were talking to one vendor about this, but I guess we were too small to interest them.

Anyway, from the California Labor Code:

213. Nothing contained in Section 212 shall:
(d) Prohibit an employer from depositing wages due or to become due or an advance on wages to be earned in an account in any bank, savings and loan association, or credit union of the employee's choice with a place of business located in this state, provided that the employee has voluntarily authorized that deposit.

So California employees must give their assent to direct deposits. My thought would be that this would hold true for payment into a paycard.

No it needs to be negotiable and payable in cash without discount. Direct deposit goes directly into ones account and can then be withdrawn immediately without discount. Cards are much different

ScottB
01-26-2007, 08:01 AM
The only way I see a paycard being legal form of payment is if there is some ATM out there which does not assess a fee for withdrawing money from said card.

There are networks that don't charge fees to participating pay card programs.

I agree that if the program is set up so that it always charges a fee for a transaction, that would not conform to California's law (or Maine's, for that matter).

Villain
01-26-2007, 08:35 AM
Theres a similar case that comes to mind. Labor Ready, a day laborer temp agency, has had problems with numerous states with charging a fee for their cash dispensing machines. They withhold $1 plus whatever change your receive on your check. Read paragraph 18.
http://www.motherjones.com/news/feature/2002/03/street_inc.html

Villain
01-26-2007, 08:55 AM
http://biz.yahoo.com/ap/061116/apfn_check_cashing_fees.html?.v=2

DAW
01-26-2007, 09:01 AM
The following are the CA pay card rules as per the BNA payroll library (a paid service):

Payroll Debit Card Permitted with conditions.
Opinion: Funds must be deposited in a California bank, pursuant to Labor Code 213(d), that allows an employer to deposit wages due or to become due or an advance on wages to be earned in an account in any bank, savings and loan association, or credit union of the employee's choice in this state ... Must be no fee for using the card. The cardholder must be furnished with a booklet showing all locations of all or most of the ATMs throughout the state. If the place where the wages are to be deposited is not a California institution, the company may waive any right it might have to extraterritorial service of subpoenas for bank records regarding these types of accounts and still use an out-of-state bank. (Opinion letter 1994.02.03-1)

Villain
01-26-2007, 09:29 AM
I read the opinion letter, 1994-02-03-1 (http://www.dir.ca.gov/dlse/opinions/1994-02-03-1.pdf), which brings me to the question, can the lump sum be withdrawn from the card? I believe ATMs have a maximum daily withdrawl from a card. A salaried exempt person, whom is paid on a monthly basis and lets say nets $5k a month, would probably not be able to withdraw that from an ATM.

Karomara
02-01-2007, 03:07 PM
Actually this is legal in CA providing that they do not charge for the first transaction. Most paycards issue checks that you can write as well as the ATM card. We had this at my last employer in CA and it was fine. Most people used the check and wrote the whole amount to themselves and deposited it that way.

Villain
02-01-2007, 09:33 PM
And you KNOW it's legal because....??...your employer did it? They cannot charge to get your own money regardless of if its the first transaction on the card or the 42nd.

Karomara
02-01-2007, 11:36 PM
And you KNOW it's legal because....??...your employer did it? They cannot charge to get your own money regardless of if its the first transaction on the card or the 42nd.

I know it's legal because I checked with the Department of Labor Standards Enforcement. And yes, as long as the first transaction is free, it's legal. Check with them yourself

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