Can we mandate direct deposit? — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Can we mandate direct deposit?

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in Compensation and Benefits,Human Resources

Q. We require all employees to provide us with bank account information so we can direct-deposit their pay. One of our employees has refused and has told us that she is not required accept electronic deposits of her pay. Is the employee correct?

A. Yes. Under Minnesota law, direct payroll deposits must be voluntarily authorized, and employees may refuse to accept your electronic payroll service. In addition, if an employee accepts the automatic deposit service, you are required to deposit the funds into the account chosen by the employee.


Megan L. Anderson is an attorney with Gray Plant Mooty’s Employment Law Practice Group in Minneapolis. Concentrating her practice in employment law counseling and litigation, she ­regularly advises employers and provides training on a variety of employment law issues. Contact her at or (612) 632-3004.

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