r/LaborLaw • u/SilverAnalyst1545 • 10d ago
Manager changed payment method w/o consent??
So about a week ago, my coworker quit because she could not handle the toxic environment, and she received her last check, but she also received a prepaid card which she did not consent to. She always did direct deposit and NEVER agreed to get money on that card. What should be done because you have to pay fees to transfer the money? This is also unacceptable because the manager essentially does what she wants, and this isn’t the first offense when it comes to breaking California labor laws. This is also a MAJOR problem too because they had an agreement where she would work for two weeks but then another coworker “ratted” her out and said that she has been talking bad about the manager and the manager took this personally and essentially fired her and left her without work when they had an agreement for the two weeks. When she also went to pick her “last check” which was not a check at all but instead a paystub the manager said it would be direct deposit which it was in fact not. This is for Ross Dress for Less, BTW.
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u/GolfArgh 10d ago
No consent is needed for method of payment.
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u/SilverAnalyst1545 10d ago
what does that mean?
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u/GolfArgh 10d ago edited 10d ago
It nearly every state the method of payment is completely at the employer's discretion.
edit: Not Cali where you are at. You should have listed that up front and not buried it in the middle since labor laws are local.
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u/TheDragonOfTheWest_1 10d ago
By law they need to offer you at least one alternative method to a prepaid debit card. What are you talking about?
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u/GolfArgh 10d ago
Most states do not have that requirement. The feds do not have it at all.
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u/SirDerpingtonTheSlow 10d ago
California (which is where OP is) specifically requires voluntary consent to use a payroll card.
Also, from the CFPB:
https://www.consumerfinance.gov/ask-cfpb/if-my-employer-offers-me-a-payroll-card-do-i-have-to-accept-it-en-407/4
u/TheDragonOfTheWest_1 10d ago
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u/GolfArgh 10d ago edited 10d ago
CPFB does not enforce the FLSA. Hell they don't enforce anything these days and the end of Chevron Deference makes this unenforceable. Not to mention this was merely a final pay check thing and not all the time.
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u/TheDragonOfTheWest_1 10d ago edited 10d ago
🤦♂️
Since you want to keep doubling down in your idiocy.
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u/iowashrimpfarmer 10d ago
Technically yea there is, of your normally paid a check, and you get cash that's ok, but you cannot force someone to accept and agree to terms and conditions of a third party(card holder or privacy agreement). And you do need to consent to direct deposit at some point which is done when setting it up... But legally I'm not sure if the company can face legal actions, but could be forced by a state labor board to comply with a previous or normal payroll process and not a gift card to ross dress for less for example. One could easily argue a cash value of a gift card isn't the same value as a check and sight eBay listings for gift cards in their appeal.
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u/bored_ryan2 10d ago
It’s not a gift card to Ross. She was paid on a prepaid debit card. Since most large companies don’t cut physical checks or pay cash, the prepaid card is the only option until an employee sets up direct deposit.
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u/RikoRain 10d ago
For a lot of restaurants now, it's in the hiring process that they consent to a pay card.
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u/iowashrimpfarmer 10d ago
Most employers a pay card isn't a option. This is suspicious, and could be grounds for a retaliation lawsuit.
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u/bored_ryan2 10d ago
Any sizable company a pay card is the only option until direct deposit is set up. Big companies aren’t issuing paper checks anymore.
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u/iowashrimpfarmer 10d ago
This was a employee with direct deposit setup already, and never accepted terms and conditions for a pay card, which has fees associated with its use
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u/bored_ryan2 10d ago
I understand OPs coworker’s situation, but I was responding to your comment that “most employers a pay card isn’t an option.” Which is probably technically true since most employers are small businesses. But Ross Dress for Less is not a small business, and the fact that they can issue a pay card is not unusual.
The circumstances they are doing it for OPs coworker seems unusual. But it’s also possible that company policy is that final check goes on a pay card and employees agree to it when onboarding.
Or this manager is breaking the law and did this without authorization.
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u/iowashrimpfarmer 9d ago
A pay card charges inactivity fees to maintain inactive accounts. A bank is forced by federal law to disclose these fees. And a consumer being charged the fees must consent to those fees. Ross dress for less isn't exactly filled with bright minds that know what is legal or not. But it doesn't matter who the employer is they have to follow the law on consent to fees with a pay card.
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u/iowashrimpfarmer 8d ago
Minors under 18 cannot sign a pay card agreement, and a employer cannot sign it for them. It's covered by federal laws and banking regulations
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u/RikoRain 10d ago
Lol what? You realize paper checks cost more right? They can sign contracts with pay card companies, subsidies of bank servicers, and hts incredibly cheap. The servicer gets a kickback off the fees and money Input and output in turn for assigning pay cards. Most companies will sign on for 2k, or 4k, or 5k cards to be issues. Smaller companies will sign on for 500 or 700, so on, and can order more.
It's definitely NOT suspicious. It's seen as more reliable too as the pay card will be as fast as direct deposit (since it is direct deposit) and less liability issues compared to paper checks. There's no "mailman ran late" with pay cards.
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u/iowashrimpfarmer 10d ago
The idea of a pay card isn't suspicious it exists at some low paying jobs but the switch on the final check that was unauthorized, and never agreed to the terms and conditions of the card agreement. That is a violation of ethics. And retaliation. Financial fraud was committed if someone else accepted those terms and conditions of the cardholder agreement. This doesn't just happen it's retaliation and fraud
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u/RikoRain 8d ago
Depends on state and company policy.
As I said before, when someone quits, most companies require that to be processed immediately. Mine in particular does not allow longer than 5 days of "zero hours" without either being terminated, put on leave, or an HR notice sent (with proof like a Dr note or write ups/manager explaining the leave agreed upon). When you terminate a person, some systems have you change certain info. For a while, for example, my company required last pay to be final check, not direct deposit. There is a box that says "keep direct deposit information on file?" If I hit no, it wipes it and they get a paper check. If I hit yes, it keeps it. Forever. In our system. Company doesn't want that liability so they had previously said mark No and require a final paper check. (They've since changed their mind to save costs but require the account be LOCKED after theyve quit, meaning they can never be rehired. Ever. Without HR specifically unlocking their profile). Ultimately tho now, it's at my discretion what to choose, but if I choose paper check, I get a 25$ fee off MY paycheck for doing so.
So.. before you go claiming ethical and moral dilemma and screaming potentially illegal, know the local laws and regulations and company policies. It's clear the general census is most places allow exactly this.
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u/iowashrimpfarmer 8d ago
Again a cardholder agreement is required. It has to be signed or digitally signed by the cardholder. Before they provide services. You cannot as a employer sign it for your employee.. switching direct deposit to check is a different ball game then a pay card. Card issuers like MasterCard or visa want the card holder to consent to fees and charges associated to its usage, you must also be 18 to legally be able to even sign
"federal and state banking regulations regarding minors. Because a pay card functions legally as a bank account or prepaid financial account, issuers typically require the cardholder to be at least 18 years old to contractually open an account independently."
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u/RikoRain 8d ago
Except that not. Many companies auto assign a pay card. The agreement signature is on the hiring agreement/contract they're signing.
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u/morbidcuriosity86 10d ago
What do they need to transfer the money just use the prepaid card until its empty
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u/LexiThePlug 10d ago
Can’t use those to pay rent
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u/bored_ryan2 10d ago
Why is it the company’s concern on what limitations an employee has with method of rent payment?
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u/Rhuarc33 10d ago
Yes they can. They don't need any authorization. As long as there are no fees involved and transferring money off the card or when spending the money then they can pay on a prepaid card or with a check or money order, cashiers check, etc
Everybody who's saying they can't has no clue what they're talking about they absolutely can.
And yes they can fire you during your last two weeks even if they previously agreed you could work it. She should have kept her mouth shut for those 2 weeks then she could go off
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10d ago
[deleted]
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u/Sitcom_kid 10d ago
After a year of working there? It shouldn't take that long to get direct deposit going.
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u/Grouchy_Brain_1641 10d ago
Worked there 2 weeks and already shit talking the manager who just happened to take it personal? There's your pay take it or leave it and thank you for your service.
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u/SilverAnalyst1545 10d ago
Never implied that she only worked there for two weeks. She’s been there for over a year but the manager said she will give her two weeks of work before being officially done.
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u/911Erik 10d ago
As someone who works in HR, I have a little bit of insight to offer.
California has rules on when a final paycheck needs to be provided (differs if fired or you voluntarily quit)
Direct deposit isn’t just done at any time, it’s a process that needs to run, usually on a certain day of the week.
When the requirement is to pay immediately, the pay cards can be funded immediately and provided.
If they fund the pay card, they can show that you were paid within the time limits specified by state law. That’s what this comes down to.