Announcement

Collapse
No announcement yet.

Mandatory Direct Deposit Texas

Collapse
This topic is closed.
X
X
  • Filter
  • Time
  • Show
Clear All
new posts

  • Mandatory Direct Deposit Texas

    We are a national company (have offices in 13 states). We have our largest office in Houston Texas. The Operations Manager there is wanting to mandate direct deposit for his office only. With the recent Hurricane, we had a number of employees who have live checks and we are having difficulty getting the money to them. There are several local banks that have offered to give free accounts to our employees if they have no other banking relationship. Can we allow 1 office (out of 44 offices) to mandate direct deposit?
    Last edited by dianet; 09-16-2008, 07:17 AM.

  • #2
    Yes, you may allow mandatory direct deposit for only some but not all offices. In fact, you may not have a choice since very few states permit mandatory direct deposit. Texas does according to my information, so if you want to make direct deposit mandatory in just your Texas office that's okay. But the issue is not your having the rule for some offices and not others - the issue is whether the law in the specific state permits it at all.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

    Comment


    • #3
      Thank you so much for your quick response! I will pass this on to our Operations Manager.

      Comment


      • #4
        Mandatory direct deposit is, however, a pet peeve of mine, whether the law allows it or not. I have managed many a large payroll operation with employees in many states. Making it "mandatory" is, IMHO, problematic. What happens when the employee closes one account and refuses to give you information for the new one?

        Seems to me that the carrot approach would be better than the stick. If the employees are so concerned with not receiving their checks because of unforeseen circumstances, now is the time to push the benefits of direct deposit. I would think that the employees would be more concerned with getting their funds.
        I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

        Comment


        • #5
          That is one problem. The nature of the employee refusing to cooperate might be another. Let's say that your CEO refuses. What is the response? Fire her? Is this going to be a policy uniformly applied to all employees? Or just those that you do not like? And if the policy is selectively enforced, will the employees being discriminated against claim another reason, such as one of the Title VII reasons.

          Like Patty I am a long time payroll person who loves direct deposit but am very skeptical about mandatory direct deposit. At a prior employer we were using voluntary direct deposit, but actively selling the program. I got a hysterical employee in my office who said that her ex-husband was a banker, that if she signed up for direct deposit he would find her and he would kill her. No problem, because this was voluntary. I was fine with staying with checks. About a month later she quit and several weeks after her husband showed up in one of the reception areas looking for her. The police were called.

          Sometimes there are real world consequences to company policies. Direct deposits can be a wonderful thing, but sometimes employees have very valid reasons for not wanting to participate.

          Past that, I have worked for companies that had formal agreements with credit unions. We could guarantee any employee a bank account (until they seriously abused the privilege anyhow), which was sometimes useful.
          "Reality is that which, when you stop believing in it, doesn't go away".
          Philip K. **** (1928-1982)

          Comment


          • #6
            Texas law re direct deposit: Employers may use direct deposit *for employees who maintain accounts at a financial institution*. Employers who desire to pay through direct deposit must (1) notify each affected employee in writing at least 60 days before the date on which the direct deposit system is scheduled to begin and (2) obtain from employees any information required by the financial institutions in which the employees maintain accounts.

            To use a debit card - this has to be approved by the employee in writing.

            The Tx. law allows direct deposit of wages for employees who already have bank accounts. It does not expressly state that an employer may require an employee who does not maintain a bank account to establish one. This ambiguity will probably leave many employers in doubt as to their position regarding direct deposit of wages. The state law does not overcome whatever objections the DOL and the EEOC may have toward such a system under the federal laws they enforce.

            per the TWC & labor code 61.017
            Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

            Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

            Comment

            Working...
            X