Wednesday, June 3, 2015

New York’s Schneiderman says workers have earned payroll card protections

By J. Preston Carter, J.D., LL.M.

“Of the many issues swirling around Albany as the legislative session draws to a close,” New York Attorney General Eric T. Schneiderman wrote in an Op-Ed published in amNewYork, “few should be less controversial than ensuring New Yorkers are paid the wages they earn, without getting cheated or charged when they try to spend their money.” The AG continued, “New Yorkers deserve legal protection to make sure payroll cards do not chip away at their wages,” and he urged the state legislature to protect workers by passing his legislative program—My Payroll Card Act—“before this session ends next month.”

My Payroll Card Act seeks to increase cardholder protections for workers; resolve ambiguities in New York’s labor law to set forth clear rules for both employers and employees on the use of payroll cards; and ensure that payroll cards offer a convenient, beneficial, and fair method for workers to access their pay. Schneiderman recently announced that he had secured legislative sponsorship for the measure.

Payroll cards are prepaid debit cards used in lieu of paychecks and direct deposits. Schneiderman noted that payroll cards do offer benefits over paper checks, including greater efficiency and reduced environmental impact. Also, they can be more reliable during natural disasters and provide a useful alternative for workers without bank accounts, who may otherwise have to pay check-cashing companies.

However, fees for withdrawals, purchases, and checking the account balance can run as high as $20 per month. Schneiderman wrote that passing the legislation would ensure that “New Yorkers are paid the wages they earn, without getting cheated or charged when they try to spend their money.” Should the state legislature fail to act, the AG continued, the state Department of Labor should issue regulations to protect workers.

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