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List of States Where Mandating Direct Deposit is Illegal
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List of States Where Mandating Direct Deposit is Illegal
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As the topic suggests, I'm looking for a list of states where it is illegal to manadate the direct deposit of payroll. Any help would be greatly appreciated.
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Forums » Topic Forums » Legal Forum » List of States Where Mandating Direct Deposit is Illegal
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 4:37 AM EST
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
I had a list but it was from 2005, which I suspect is VERY outdated. And if I remember correctly some of the states that did have laws still required government employees to use DD. But it's been a long time since I looked state by state.
I suspect a chart could be put together in about a day by googling "mandatory direct deposit statename". But unfortunately that is not something I have time to do or need right now. Although it is something that weirdly I would enjoy.... |
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 7:28 AM EST
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
Here is a current list and source
http://www.besthronline.com/wp-content/uploads/free/direct_deposit_free_information.doc http://www.besthronline.com/blog/direct-deposit STATE PRIVATE SECTOR MANDATORY DIRECT DEPOSIT PUBLIC SECTOR MANDATORY DIRECT DEPOSIT AL YES NO AK NO NO AZ NO NO AR NO CA NO NO CO YES, IF EMPLOYEE AUTHORIZES & NAMES FINANCIAL INSTITUTION CT NO NO DE NO DC NO FL NO NO GA NO NO HI NO, NOT WITHOUT CONSENT NO, NOT WITHOUT CONSENT ID NO, NOT WITHOUT CONSENT NOT WITHOUT CONSENT IL NO NO IN YES, INDIANA DOL YES, INDIANA DOL IA NO NO KS YES YES KY YES YES LA NO LAW YES ME YES YES MD NO NO MA NO NO MI NO NO MN NO NO MS NO LAW MO NO LAW MT NO NO NE NO LAW NV NO NO NH NO NO NJ NO NO NM NO NO NY NO NO NC YES YES ND YES YES OH NO LAW OK NO STATE GOVT. HIRED AFTER 12/31/04 YES OR NO NO PA STATE LAW DOESNâT EXPLICITLY ALLOW IT, BUT 1 PA COURT HAS ENDORSED THE PRACTICE RI NO NO SC YES WITH STIPULATIONS YES WITH STIPULATIONS SD YES YES TN NO STATUTE BUT STATE ATTORNEY GENERAL ISSUED OPINION ALLOWING TX YES YES UT YES, EXCEPT FARM, DAIRY, AGRICULTURAL, VITICULTURAL, OR HORTICULTURAL, HOUSEHOLD DOMESTIC SERVICE, OR OTHER EMPLOYMENT IN WHICH A WRITTEN AGREEMENT PROVIDES DIFFERENT TERMS VT NO NO VA NO NO WA NO LAW WV STATE INSTITUTIONS OF HIGHER EDUCATION YES & WPCA EMPLOYERS WI YES WITH STIPULATIONS YES WY NO NO |
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 7:39 AM EST
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
Be careful using any list -- for example the list above says that TX is a Yes in both categories, but TX has some caveats to that :
"Delivery of wages is fairly flexible. Wages can be given in person to an employee, mailed to a designated address (in time to be received on the payday), deposited electronically into an account (direct deposit), given to a third party who has been AUTHORIZED BY THE EMPLOYEE IN WRITING to receive the employee's paycheck, or paid in any other way to which the EMPLOYEE HAS AGREED IN WRITING. There are some pitfalls, to be sure. For instance, payment of wages by EFT (electronic funds transfer, or direct deposit) involves prior arrangements and paperwork with a bank and is subject to federal and state rules. If the employee receives part or all of the wages "in kind" (in a form other than cash or negotiable money order or check), the employee has to have AUTHORIZE THAT IN WRITING IN ADVANCE OF THE PAYMENT." Please note the Capitalized parts are mine. So while it can be mandatory, you also have to have the employee's written authorization to do so. This is much harder to get from a current employee if you are switching over than from a new hire where you can make it a requirement to get the job. |
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 7:43 AM EST
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
here's the direct link to the TWC and where I got the quote:
http://www.twc.state.tx.us/news/efte/delivery_of_wages.html It is from the Texas Employers Handbook put out by the state...and is more of a policy/procedure manual that explains the Laws/codes. |
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 8:24 AM EST
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
rrurpt
Don't think you read this correctly. Please see my bolded lettering. Then there is a comma for a different concept beyond direct deposit which is delivery to a third party and then another comma for any OTHER methods again not direct deposity. Direct deposit is not delivery to a third party. "Delivery of wages is fairly flexible. Wages can be given in person to an employee, mailed to a designated address (in time to be received on the payday), DEPOSITED ELECTRONICALLY INTO AN ACCOUNT, given to a third party who has been authorized by the employee in writing to receive the employee's paycheck, or paid in any other way to which the employee has agreed in writing. |
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List of States Where Mandating Direct Deposit is Illegal
posted at 3/3/2011 9:00 AM EST
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
Nope, but the NEXT paragraph in the same quote specifically references EFT/DD and authorization in writing. I quoted this directly from the State of Texas website.
I would ALWAYS suggest that any employer wanting to implement mandatory DD in any state make sure they look specifically at laws and policies in that state. Not just at a chart online. It's often not as simple as a YES/NO answer. If it is a YES, the employer needs to understand what procedures they must go through for it to be a YES becasue there are often qualifications. A NO is much easier to deal with. I've done payroll in Texas for 6 yrs now so I am pretty familiar with their payroll laws and that is one reason I chose to put that as my example. And just to give some more backup directly from the TWC (who enforces TX wage claims): "The new provision allows direct deposit of wages for employees who already have bank accounts. It does not expressly state that an employer may require an employee who does not maintain a bank account to establish one. This ambiguity will probably leave many employers in doubt as to their position regarding direct deposit of wages." from http://www.twc.state.tx.us/news/efte/electronic_fund_transfer_wages.html The whole page is a very interesting read as it also takes into account EEOC, DOL and FDIC statues/positions. This is what the state of Texas has given their employers to think about....beyond a YES on a chart online. |
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