The movement to pay employees via prepaid cards is not without its critics, but it’s gaining traction in many workplaces because of cost-effectiveness and convenience, says John Litchfield of Foley & Lardner. The system is similar to using bank debit cards, he says, but it does not require employees to actually have bank accounts. They can instead use their paycards through ATMs or debit card payment terminals.
“The growing use of paycards has also come with new state laws regulating the way in which employers can permissibly use paycards and the terms of use employees are subjected to if they elect to have their wages paid by paycard,” says Litchfield, noting that laws regulating their use have been created in at least 27 states. But none of these laws is the same, thus creating confusion and uncertainty.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
