Paychecks issued from out-of-state banks may trigger a labor-code violation — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
It’s a little-known detail within some state labor laws, but in California, for example, the issue could end up costing an employer big. In Fleming v. Dollar Tree Stores Inc., a federal district court in San Francisco is letting a proposed class action go forward that alleges Dollar Tree issued payroll with checks from an out-of-state bank with no California branches. That, the complainants contend, forced employees to incur check-cashing fees and extended waiting periods for their deposits.
To avoid the same fate, the court hinted that all employers can satisfy the mandates of stringent labor codes by doing one of these:
1. Offer to cash employees’ checks at one of its business locations.
2. Retain a check-cashing service.
3. Arrange for in-state banks to waive any check-cashing fees that employees otherwise would have to pay.
The IRS is in the middle of intensive line-by-line payroll audits to ensure that your withholding procedures are 100% correct. And it's not just the IRS. The U.S. Department of Labor has been on the prowl lately for employers that slip up on the confusing retirement contribution rules....Click here to find out more.