Pennsylvania, New Jersey and Nationwide
An increasing number of major employers are paying workers with prepaid debit cards rather than paper checks or through direct deposit. Unfortunately for workers—many of whom are automatically enrolled in debit card payroll systems and forced to accept prepaid cards for their wages—these cards are typically accompanied by a number of fees and restrictions on their use, which puts low-wage employees in an unfair position.
This practice may be prohibited under federal and state laws, and the Philadelphia-based class action attorneys at Golomb & Honik are currently investigating complaints that many large employers including McDonald’s, Walgreens and Walmart are paying employees with prepaid debit cards without the option for check or direct deposit. If you or someone you know is paid with a payroll debit card, please call Golomb & Honik at 888-826-5002 for your free consultation with one of our knowledgeable lawyers.
Payroll Debit Cards
Prepaid debit cards are an especially popular payment form for retailers and restaurant chains, many of which no longer provide employees with alternate payment options like checks or direct deposit. While prepaid debit cards may save employers payroll expenses, they often saddle low-income workers with exorbitant and financially devastating fees.
A recent article in The New York Times details the impacts these fees have on workers and their families; in some cases, employees end up earning less than the minimum wage after charges related to debit card use are taken into account. The U.S. Department of Labor and New York attorney general have ongoing probes related to payroll debit card practices, which many consumer advocates have called unethical and which may in some cases also be illegal.
Companies that Pay Employees with Debit Cards
Among the large-scale employers issuing prepaid debit cards as opposed to traditional paychecks or direct deposit are:
- Home Depot
- Limited Brands
- McDonald’s
- Taco Bell
- Walgreens
- Walmart
It is important to note that some companies provide employees with a choice of payment method. Others, however, have not given employees an option or have not informed employees that other forms of payment are available.
If you or someone you know receives wages via a prepaid debit card, please contact Golomb & Honik today. Our consumer rights attorneys welcome clients from the greater Philadelphia, Pennsylvania, area and nationwide.
