Pay cards across America
From the April 2009 issue of Ceridian Connection.
Despite the headlines, some things are on the upswing. Take, for example, the popularity of pay cards as a payroll disbursement option. A recent American Payroll Association (APA) study found that 30.6 percent of respondents currently used pay cards while 43.4 percent indicated they would like their employers to adopt a paperless payroll system. Employers and employees can benefit from the efficiencies and convenience of pay cards.
New workforce, new technology
Today's workers expect -- and need -- immediate access to their hard-earned wages on pay day whether they are close to home or away on vacation. While workers enjoy the immediacy of pay cards, few people stop to think about what takes place in the background. Payroll trail blazers have been working with government officials to educate legislators and regulators about how labor laws governing pay cards should be revised for today's workforce. Their efforts help make pay cards and other payment solutions work seamlessly.
"Technology has evolved payment methods faster than many state governments have updated laws and regulations," says Lisa Peerman, senior vice president, general counsel of Comdata Network, Inc.
In several cases, state laws relating to employer payment requirements have been on the books for decades. And while state agencies may agree in theory that pay cards should be allowed, the recommended course of action sometimes requires a change in an existing law.
Positive progress
The American Payroll Association Government Affairs Task Force Payroll Card Subcommittee is made up of member payroll professionals from a variety of companies. It works diligently with state agencies to address the archaic laws governing pay cards. In some cases, it is not necessarily the law, rather the lack of clear state guidelines that the APA subcommittee works to change.
Members of the committee monitor legislation, support the good bills and offer alternatives. The APA keeps members and interested parties apprised of the current activities through its pay card portal.
States that have taken official legislation or regulatory steps to permit the use of pay cards include Colorado, Delaware, Kansas, Maine, Maryland, Michigan, Minnesota, Nevada, New Hampshire, North Dakota, Oklahoma, Virginia and West Virginia. In other states, such as Vermont, Connecticut and Texas, legislation is in process to address the use of pay cards.
Federal legislation
In 2007 the federal government expanded the law, Regulation E of the Electronic Funds Transfer Act, to include pay cards. Consumer protections contained in Regulation E include:
Benefits to employers/cardholders
In the midst of changing legislation, employers can take steps to ensure that their employees enjoy the benefits of pay cards, particularly in states with legislation in process. Companies should regularly communicate about the pay card disbursement option to employees and obtain a signed consent form. Some employers will go one step further and produce a paper check receipt as a reminder of the funds deposited.
Employers experience benefits including:
There are also benefits for both the employers and cardholders. These include:
The Ceridian PayCard solution can give employees access to cash from over 1.3 million ATMs, more than 28,000 MasterCard member bank branches where the employee can present the card to the teller and ask for a cash disbursement, and 25 million MasterCard merchant locations. Let us put our unrivaled experience in card-based electronic funds distribution to work for your company and your employees. Employees receive the benefit of immediate access to funds, while you benefit from a simpler, more streamlined payroll process that can help improve the bottom line. Find out more about Ceridian PayCard and our other payroll management solutions.
Despite the headlines, some things are on the upswing. Take, for example, the popularity of pay cards as a payroll disbursement option. A recent American Payroll Association (APA) study found that 30.6 percent of respondents currently used pay cards while 43.4 percent indicated they would like their employers to adopt a paperless payroll system. Employers and employees can benefit from the efficiencies and convenience of pay cards.
New workforce, new technology
Today's workers expect -- and need -- immediate access to their hard-earned wages on pay day whether they are close to home or away on vacation. While workers enjoy the immediacy of pay cards, few people stop to think about what takes place in the background. Payroll trail blazers have been working with government officials to educate legislators and regulators about how labor laws governing pay cards should be revised for today's workforce. Their efforts help make pay cards and other payment solutions work seamlessly.
"Technology has evolved payment methods faster than many state governments have updated laws and regulations," says Lisa Peerman, senior vice president, general counsel of Comdata Network, Inc.
In several cases, state laws relating to employer payment requirements have been on the books for decades. And while state agencies may agree in theory that pay cards should be allowed, the recommended course of action sometimes requires a change in an existing law.
Positive progress
The American Payroll Association Government Affairs Task Force Payroll Card Subcommittee is made up of member payroll professionals from a variety of companies. It works diligently with state agencies to address the archaic laws governing pay cards. In some cases, it is not necessarily the law, rather the lack of clear state guidelines that the APA subcommittee works to change.
Members of the committee monitor legislation, support the good bills and offer alternatives. The APA keeps members and interested parties apprised of the current activities through its pay card portal.
States that have taken official legislation or regulatory steps to permit the use of pay cards include Colorado, Delaware, Kansas, Maine, Maryland, Michigan, Minnesota, Nevada, New Hampshire, North Dakota, Oklahoma, Virginia and West Virginia. In other states, such as Vermont, Connecticut and Texas, legislation is in process to address the use of pay cards.
Federal legislation
In 2007 the federal government expanded the law, Regulation E of the Electronic Funds Transfer Act, to include pay cards. Consumer protections contained in Regulation E include:
- Initial disclosures of the terms and conditions of EFT services
- Liability of consumer for unauthorized transfers
- Change-in-terms notices
- Error resolution notices
- Mandatory receipts at electronic terminals
- Mandatory periodic statements
- Procedures for resolving EFT errors
Benefits to employers/cardholders
In the midst of changing legislation, employers can take steps to ensure that their employees enjoy the benefits of pay cards, particularly in states with legislation in process. Companies should regularly communicate about the pay card disbursement option to employees and obtain a signed consent form. Some employers will go one step further and produce a paper check receipt as a reminder of the funds deposited.
Employers experience benefits including:
- Streamlined processes
- Flexible account structure and reporting
- Card funding administered like direct deposit
- Card-holder self-service via Interactive Voice Response (IVR) and Web
- Daily invoices retrievable via Web
- Instant card issuance and replacement
There are also benefits for both the employers and cardholders. These include:
- Convenient and immediate access to funds
- Full capabilities to cash out
- Real-time activity reporting via IVR and Web
- Direct funds in any amount to multiple or direct deposit funds
- Instant replacement of lost or stolen cards
- Secure card activation via IVR
- Twenty-four hour multilingual cardholder service
The Ceridian PayCard solution can give employees access to cash from over 1.3 million ATMs, more than 28,000 MasterCard member bank branches where the employee can present the card to the teller and ask for a cash disbursement, and 25 million MasterCard merchant locations. Let us put our unrivaled experience in card-based electronic funds distribution to work for your company and your employees. Employees receive the benefit of immediate access to funds, while you benefit from a simpler, more streamlined payroll process that can help improve the bottom line. Find out more about Ceridian PayCard and our other payroll management solutions.
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