The short answer is: yes. In Illinois, an employer can pay employees with a debit or credit card, but only if the employer meets certain conditions. Section 14.5 of the Illinois Wage Payment and Collection Act deals with electronic payroll cards and how employees must be paid under the law.
Employees have rights under the law. First things first, an employee has to voluntarily agree to be paid by electronic debit or credit card. Under the law, an employer cannot force an employee to accept this payment method. Also, an employer has to give the employee the option of a non-electronic form of payment such as check or cash in addition to an electronic option such as direct deposit or debit or credit card. Finally, the employee is free to revoke his authorization to be paid by debit or credit card and the employer must honor the employee's request.
Under the Wage Payment and Collection Act, an employer using a payroll card program must provide an itemized statement of all hours worked, the rate of pay, and any lawful deductions made. Additionally, an employer must inform the employee in writing of any fees, penalties, and costs of using a payroll card for the payment of wages. Payroll programs that charge certain fees, including fees for point of sale transactions, are prohibited by the statute.
While the Illinois Wage Payment and Collection Act attempts to protect employees from abusive payroll card practices, some employers will use the program to conceal their failure to pay minimum wages and overtime compensation to employees. If you believe you are not being paid your lawful wages, contact us today for a free and confidential consultation. The Illinois Department of Labor also has a useful primer on electronic payroll card requirements and you can read information here.
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