Jottings By An Employer's Lawyer

Monday, July 15, 2013

Pay Cards - Federal Standard Might Be Helpful

Although employers are often ambivalent, if not negative, about federal involvement in the workplace, there are time when it is beneficial. 

There is not anything that is more basic about the employment relationship than how employees get paid. I can still remember getting my 65 cents an hour pay as a delivery boy for Graves Drugstore, in cash, in a little white envelope every Saturday.  For a 15 year old netting $35 a week that was fine, but not very scalable for a larger employer.

And in a world where the number of the unbanked and underbanked is growing larger, see the Forbes article, Who Needs Banks?, it's an issue that also impacts employees.

One solution has been pay cards. But for a national employer using this means of payment means complying with a whole host of state laws, very few of which are specifically designed to address that particular issue. So, wending your way through the maze can be complicated, and that means expensive.

So the NYT article, 16 Senators Seek Inquiry of A.T.M.-Style Pay Cards, highlights one of the times where at least some segments of the employer community might be happy with a comprehensive review of the issue and a federal solution.

As the article points out, it is an area where there can be abuse. But abusing employees is not the desire nor intent of all but the most rogue of employers, and so reasonable rules and regulations that could be applied across the country no matter where the employee works would really be helpful.

The devil is in the details of course, but my guess is that this is one area where common ground could be found and Congress might could actually solve a problem that exists for  employers and make sure that employees are protected. 

Wouldn't that be a novel gift from Congress?

Very helpful! Thanks, Mike. Always enjoy reading your blog. Do you think there's any chance of a federal standard? I agree that they certainly could - but do you think they will? Seems like lately they've had trouble coming to consensus on the color of the sky.
Thanks for raising this issue once again, Michael. Personally, I think it would be a lot better if employers use A.T.M.-style pay cards to pay their employees' wages because it would be safer and easier.
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