Illinois Payroll Card Legislation Moves to the Senate (April 14, 2014)
The Illinois House last week approved legislation that, if signed into law, might affect companies’ payroll card programs, beginning Jan. 1, 2015, when the new rules would take effect. The bill establishes limits on fees, ensures employees’ ability to choose a payment method other than payroll card and requires companies to give employees notice of the terms of the payroll card program, among other requirements.
HB 5622, which was approved 63-39 and has been sent to the Senate, was written by Attorney General Lisa Madigan’s office. The attorney general began an investigation into payroll card use last year after receiving complaints from employees about fees.
“My goal is to ensure low-wage workers receive all of their wages,” Madigan said. “It makes no sense that the amount you receive on a gift card is better protected than the wages you receive on a payroll card. This bill is designed to ensure that workers actually get all of their wages instead of losing them to unreasonable fees.”
Earlier this year, the Network Branded Prepaid Card Association (NBPCA), along with consumer advocacy group Consumer Action, developed guides to help companies and employees learn about payroll cards and mitigate misconceptions. The publications, “An Employer’s Guide to Payroll Cards” and “An Employee’s Guide to Payroll Cards,” detail how payroll card programs work, options for accessing wages and how to avoid or limit fees. The guides were produced with the input of leading payroll card providers ADP, Commerce Bank and First Data, along with MasterCard and Visa.