New York’s Department of Labor, as part of its new payroll card rules, has issued its draft of notice and consent forms employees must fill out when deciding how to receive their wages. What the state calls “model templates” have created some confusion in the prepaid industry, as payroll card providers examine their plans for either complying with the rules—which go into effect March 7—or exiting the state.
The forms are notices and consents for payroll debit cards and direct deposits that employers must provide to employees prior to disbursing wages. The NYDOL will accept comments on the templates until Feb. 10, in advance of the effective date of its final rule regulating wage payments.
The final rule, which covers payroll cards, was opposed by the NBPCA, which said the rule will cause providers to incur substantial expenses to maintain separate compliance programs for New York workers, and that myriad fee restrictions could make it uneconomical for providers to offer payroll cards, among other concerns.
The templates, which include typos, unclear instructions and errors about the applicable requirements for each payment vehicle, have raised concerns in the industry. For instance, the direct debit form includes this sentence: “As a New York State employer, we must can [sic] pay your wages in cash or check.” On that same form, it says: “Please note that we must receive your written consent at least seven business days prior to paying wages by direct deposit.” But according to the final rule, payment of wages via direct deposit requires no such consent period; instead, the final rule calls for a seven business day consent period for payment via payroll debit cards. Perhaps most concerning is that the state is accepting comments on the templates through Feb. 10, but firms are expected to comply with the rules and be using the templates by March 7, 2017.
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