The CFPB published a bulletin today reminding employers thatthey cannot offer their employees only reloadable payroll cards as ameans of collecting their wages.
|A controversy arose earlier this year when a McDonald'sRestaurant employee in Pennsylvania was told she could only be paid by payroll card and not through direct deposit toher credit union account.rd
|“Employees must have options when it comes to how they receivetheir wages,” said CFPB Director Richard Cordray. “Today's releasewarns employers that they cannot mandate that their employeesreceive wages on a payroll card. And for those employees who chooseto receive wages on a payroll card, they are entitled to certainfederal protections.”
|The CFPB reported having reports of employers, particularly inthe retail and food service industries, distributing wages solelythrough payroll cards. Federal law, however, prohibits employersfrom mandating that employees receive wages exclusively on apayroll card, the agency said.
|Some employees receiving wages on employer-sponsored payrollcards have complained of unexpected fees for activities such as ATMuse, teller withdrawals, and checking the balance of a card, CFPBadded.
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