Today's "Let's See How We Can Fuck Over the American Worker" Thread

[Berkut]

A quick internet search shows that payroll cards are an issue.

[crazy canuck]

A quick internet search shows that payroll cards are an issue.

[11B4V]

Berkut 9808 &CC 9809 look at your post counts. 

[Habbaku]

A quick internet search shows that payroll cards are an issue.

That's some quality journalism there.  He could write for the NYT!

[dps]

So half the states don't allow them to forgo paper checks and it looks like employers can be in trouble for payroll card only policies, and they don't actually have any sense of how many employers offer payroll cards period...

Ok, so in 50% of your States employees are getting screwed and in the remaining 50% employers may be skirting the law to screw their employees.

Still not sure what point you are trying to make?

From a policy perspective, what is the justification for allowing any employer to transfer the cost of paying their employees onto the employees?

Dude, businesses are always going to transfer any costs of doing business to their employees or customers:  "Well, since the government has now mandated that we go to the extra expense of offering printed paychecks, we'll have to freeze everybody's pay for the next 2 years.  Oh, and all of our merchandise is going to go up in price 7.5% across the board".  Obviously, that's exaggerated--almost no one is ever THAT blatant about it--buts it's what generally happens.

[Admiral Yi]

I don't see how a pay card transfers payroll costs to the employee.  With both pay cards and direct deposit the employer has to pay a fee to the processor.  With both the employer has to calculate federal, state and local withholding and transfer the funds.  With both the employer has to calculate pension/401k/health insurance contributions and forward the amounts.

My employer offers direct deposit and pay card and strongly discourages people from selecting the pay card.  I know only one person who has ever taken the pay card option, and he is pretty much a drunkard and a vagabond (he worked a couple projects and disappeared).  It's theoretically possible that he is getting blitzed with user fees, but he never mentioned them to me.

I think it would stink if I had a job that only offered a pay card and in order to get any cash off the card I had no choice but to pay a user fee.  But until I see some documentation to that effect, I'm going to believe it's only a theoretical possibility.  It doesn't help the cause that the NYT reporters used so much obvious misdirection to create the impression that that is widespread.

[crazy canuck]

So half the states don't allow them to forgo paper checks and it looks like employers can be in trouble for payroll card only policies, and they don't actually have any sense of how many employers offer payroll cards period...

Ok, so in 50% of your States employees are getting screwed and in the remaining 50% employers may be skirting the law to screw their employees.

Still not sure what point you are trying to make?

From a policy perspective, what is the justification for allowing any employer to transfer the cost of paying their employees onto the employees?

Dude, businesses are always going to transfer any costs of doing business to their employees or customers:  "Well, since the government has now mandated that we go to the extra expense of offering printed paychecks, we'll have to freeze everybody's pay for the next 2 years.  Oh, and all of our merchandise is going to go up in price 7.5% across the board".  Obviously, that's exaggerated--almost no one is ever THAT blatant about it--buts it's what generally happens.

But at least in that situation the decision is transparent.  You will be paid X.  With Pay Cards, the costs are hidden and there is the potential that after all fees are paid the employee may be paid below statutory limits.

[crazy canuck]

I don't see how a pay card transfers payroll costs to the employee.  With both pay cards and direct deposit the employer has to pay a fee to the processor.

The issue appears to be that the fees associated with accessing funds from a pay card can be greater than the fees deposited directly into a bank account.

Employers have an incentive to offer pay cards because the fees are lower  - probably because of the fees the financial institution makes off of the paycards.

[Admiral Yi]

The issue appears to be that the fees associated with accessing funds from a pay card can be greater than the fees deposited directly into a bank account.

Didn't see that in the NYT article.  All I saw was that some pay cards "can charge $1.75 for withdrawing money from some ATMs."  That's about what I, a direct depositor, can be charged for withdrawing money from "some" ATMs.  I also have to pay to get a printed statement.  I can't remember how much; I think the deal is if I go paperless they waive the monthly minimum balance requirement.

Employers have an incentive to offer pay cards because the fees are lower  - probably because of the fees the financial institution makes off of the paycards.

Are you perhaps basing that statement on this from the article?

Companies and card issuers, which include Bank of America, Wells Fargo and Citigroup, say the cards are cheaper and more efficient than checks — a calculator on Visa's Web site estimates that a company with 500 workers could save $21,000 a year by switching from checks to payroll cards. On its Web site, Citigroup trumpets how the cards "guarantee pay on time to all employees."

This is talking about the cost advantage of pay cards over paper checks.  I don't doubt that companies can save a lot of money by ditching paper checks.  What's not stated in the NYT article is whether pay cards are cheaper than direct deposit.

[crazy canuck]

Yi, I am basing my comments on the link I posted presenting the business case for using pay cards.

http://av.conferencearchives.com/pdfs/100402/365.pdf

[Admiral Yi]

Yi, I am basing my comments on the link I posted presenting the business case for using pay cards.

http://av.conferencearchives.com/pdfs/100402/365.pdf

I skimmed through about page 20, couldn't see where they say user fees are higher for pay card holders than for direct depositees.

The only employer processing cost comparison I could see was between paper checks and pay cards.  I don't think anyone is disputing that paper checks are expensive.

[crazy canuck]

The presentation indicates that the majority of payroll transactions are direct deposit and then later makes the point that pay card transactions are a more efficient choice for business.

[Admiral Yi]

Can you give me a page number?  I didn't see that.

[crazy canuck]

Pages 9 and 17.


Also, if this new system of delivering payroll wasnt not less expensive than direct deposit - why would business be interested in using it for anyone other than transient workers?

[Admiral Yi]

HOLD ON.  WORK IN PROGRESS!

Pages 9 and 17.

Page 9:

* The majority of payroll disbursements have been converted to direct deposit.
* Most non-direct deposit payroll disbursements are made via paper check.

Page 17:

* Corporates place significant importance on electronifying payroll processes.
* Payroll card adoption is still in its early stages, but corporates indicate knowledge about payroll cards is increasing.
* Efficiency gains and reduced costs drive adoption of payroll card programs.
* Blah blah blah
* Blah blah blah

Also, if this new system of delivering payroll wasnt not less expensive than direct deposit - why would business be interested in using it for anyone other than transient workers?

I would think to accommodate employees who don't have bank accounts.  As I said, my employer offers the pay card option but tells everyone it sucks.