PA Legislature Authorizes Payroll Cards

On November 4, 2016, Pennsylvania Governor Tom Wolf signed into law Senate Bill 1265.  Act 161 of 2016 (the "Act") amends the Pennsylvania Wage Payment and Collection Law (the "WPCL") and allows employers to pay wages and other compensation via the use of debit cards commonly called payroll cards. This Act, which takes effect on May 3, 2017, supersedes previous case law which held that the use of payroll cards violated the WPCL.

There are some very important employee protections embedded in the Act. For example, the decision to accept payment via a payroll card must be authorized in the writing or electronically by the employee. Additionally, receipt of wages or other compensation via payroll card cannot be made a condition of employment in any way. An employee also must be permitted at least one free withdrawal and one free ATM withdrawal for each payroll period, or weekly, if the employee is paid more frequently than weekly.