New NYDOL regs address direct deposit, paycards — 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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New NYDOL regs address direct deposit, paycards

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in Compensation and Benefits,Human Resources

The New York Department of Labor has issued regulations covering how employers manage payroll direct deposit and debit cards. The regulations apply to all employees except those employed in a bona fide executive, administrative or professional capacity earning over $900 per week, or employees working on a farm not connected with a factory.

While direct deposit and payroll debit cards provide convenience for most employers and employees, employers may not require employees to choose one of these methods as a condition of hire or continued employment. An employer offering direct deposit or deb­­it cards may not penalize an em­­ployee who chooses another method of receiving pay. Also, employees must not be forced to pay fees to obtain their pay.

The regulations require employers using direct deposit or payroll debit cards to tell employees in plain language about all options for receiving their pay. They must make it clear that employees are not required to use these two methods.

Employers must also provide a list of locations reasonably close to each employee’s residence where he or she can access pay free of charge. All notices must be provided in either English or an employee’s primary language.

The employer must obtain employees’ written consent to use either direct deposit or payroll debit cards. Deposits must be made into the financial institution of the employee’s choice.

Employers may not coerce or intimidate an employee into signing the agreement. The agreement may be sent and returned electronically at the employer’s option. The funds on debit cards must not be allowed to expire. Employers must retain a copy of the agreement throughout the employee’s tenure with the company and for six years after the last payment.

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