Minnesota Legislature
SF 2093
2nd Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am
Current Version - 2nd Engrossment
1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22
1.23 1.24 1.25 1.26 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.13 2.14 2.15 2.16 2.17 2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27 2.28 2.29 2.30 2.31 2.32 2.33 2.34 2.35 2.36 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 3.22 3.23 3.24 3.25 3.26 3.27 3.28 3.29 3.30 3.31 3.32 3.33 3.34 3.35 3.36 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 4.20 4.21 4.22 4.23 4.24 4.25 4.26 4.27 4.28 4.29 4.30 4.31 4.32 4.33 4.34
4.35 4.36 5.1 5.2 5.3
5.4 5.5 5.6 5.7
A bill for an act
relating to commerce; modifying definition of "wage";
regulating payroll cards and payroll accounts;
requiring a study and report; amending Minnesota
Statutes 2004, section 177.23, subdivision 4;
proposing coding for new law in Minnesota Statutes,
chapter 177.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2004, section 177.23,
subdivision 4, is amended to read:
Subd. 4.
Wage.
"Wage" means compensation due to an
employee by reason of employment, payable innew text begin :
new text end
new text begin
(1) new text end legal tender of the United Statesdeleted text begin ,deleted text end new text begin ;
new text end
new text begin
(2) new text end check on banks convertible into cash on demand at full
face value deleted text begin or,deleted text end new text begin ;
new text end
new text begin
(3) new text end except for instances of written objection to the
employer by the employee, direct deposit to the employee's
choice of demand deposit accountnew text begin ; or
new text end
new text begin
(4) an electronic fund transfer to a payroll card account
that meets all of the requirements of section 177.255new text end , subject
to allowances permitted by rules of the department under section
177.28.
Sec. 2.
new text begin
[177.255] PAYROLL CARD ACCOUNTS.
new text end
new text begin Subdivision 1. new text end
new text begin Definitions. new text end
new text begin
For the purposes of this
section, the following terms have the meanings given them in
this subdivision.
new text end
new text begin
(a) "Payroll card" means a card issued to an employee by an
employer or other payroll card issuer to access funds from the
employee's employee payroll card account.
new text end
new text begin
(b) "Payroll card account" means an agreement providing
that an employer pays each participating employee's wages by
making an electronic fund transfer to an account, and
participating employees receive a payroll card to access their
funds.
new text end
new text begin
(c) "Payroll card issuer" means an employer that issues a
payroll card to an employee or a bank or other entity that
issues a payroll card to an employee on behalf of the employer.
new text end
new text begin
(d) "Offers a payroll card" includes both the direct offers
by the employer and the employer distribution to employees of
material describing a payroll card program prepared by a payroll
card issuer other than the employer.
new text end
new text begin
(e) "Free" means no fee is deducted from an employee's
payroll card account or charged to the employee by the employer
or the payroll card issuer.
new text end
new text begin
(f) "Fee" means any and all fees, charges, surcharges, or
costs.
new text end
new text begin Subd. 2. new text end
new text begin Filing. new text end
new text begin
A payroll card issuer must file with
the commissioner a notice containing:
new text end
new text begin
(1) the entity's true name;
new text end
new text begin
(2) any other names under which the entity conducts
business;
new text end
new text begin
(3) the entity's address, which may not be a post office
box; and
new text end
new text begin
(4) the entity's telephone number.
new text end
new text begin Subd. 3. new text end
new text begin Ownership of wages. new text end
new text begin
Wages paid by electronic
funds transferred to an employee's payroll card account must be
owned by the employee.
new text end
new text begin Subd. 4. new text end
new text begin Availability of wages. new text end
new text begin
An employee who chooses
to be paid wages by electronic fund transfer to a payroll card
account must be permitted to withdraw by a free transaction from
the employee's payroll card account, an amount up to and
including the total amount of the employee's entire net pay, as
stated on the employee's earnings statement. The free
transaction must be available to the employee on and after the
employee's regular payday.
new text end
new text begin Subd. 5. new text end
new text begin Written disclosure. new text end
new text begin
When offering an employee
the option of being paid wages by electronic fund transfer to a
payroll card account, the employer shall provide to the employee
written disclosure in plain language of all the employee's wage
payment options. The written disclosure shall state the terms
and conditions of the payroll card account option, including,
but not limited to, the requirements set forth in this section
and a complete itemized list of all fees that may be deducted
from the employee's payroll card account by the employer or card
issuer. The disclosure must also state that third parties may
assess transaction fees in addition to the fees assessed by the
employee's payroll card issuer or issuers. For fees that may be
deducted or charged by the employer or payroll card issuer, the
dollar amount of each fee must be stated. A copy of the written
disclosure must be provided to the employee.
new text end
new text begin Subd. 6. new text end
new text begin Written consent. new text end
new text begin
The employer may initiate
payment of wages to an employee by electronic fund transfer to a
payroll card account only after the employee has voluntarily
consented in writing to that method of payment. Consent to
payment of wages by electronic fund transfer to a payroll card
account shall not be a condition of hire or of continued
employment. The written consent signed by the employee must
include the terms and conditions of the payroll card account
option as provided in subdivision 5. A copy of the signed
written consent must be provided to the employee and be retained
by the employer.
new text end
new text begin Subd. 7. new text end
new text begin Transactions; statements; fees. new text end
new text begin
The employer
shall provide to the employee, upon the employee's written or
oral request, one free transaction history each month that
includes all deposits, withdrawals, deductions, or charges by
any entity from or to the employee's payroll card account.
new text end
new text begin Subd. 8. new text end
new text begin No link to credit. new text end
new text begin
The payroll card or payroll
card account shall not be linked to any form of credit
including, but not limited to, a loan against future pay or a
cash advance on future pay.
new text end
new text begin Subd. 9. new text end
new text begin Personal information. new text end
new text begin
Unless the employee
consents in writing to the use, information generated by the
employee's possession or use of a payroll card or payroll card
account may only be used to process transactions and administer
the payroll card and the payroll card account.
new text end
new text begin Subd. 10. new text end
new text begin Languages other than english. new text end
new text begin
An employer who
offers a payroll card account option to an employee using
materials in a language other than English, shall provide the
written disclosure and written consent required by subdivisions
5 and 6, and all payroll card account agreements in that other
language.
new text end
new text begin Subd. 11. new text end
new text begin Change of wage payment method. new text end
new text begin
An employee who
is being paid wages by electronic fund transfer to a payroll
card account may request to be paid wages by another method that
is allowed by law. Upon the employee's request to change the
wage payment method, the employer shall provide a form on which
the employee shall indicate the change. The employer shall,
within 14 days of the employee's request, begin payment by a
different allowable method.
new text end
new text begin Subd. 12. new text end
new text begin Limitation on employer fees. new text end
new text begin
An employer may
not charge an employee initiation, participation, loading, or
other fees to receive wages payable in an electronic fund
transfer to a payroll card account.
new text end
new text begin Subd. 13. new text end
new text begin Prohibited deductions and charges. new text end
new text begin
Fees
imposed by the employer or payroll card issuer that were not
disclosed to the employee shall not be deducted from the
employee's payroll card account or charged to the employee.
Inactivity or dormancy fees shall not be deducted from an
employee's payroll card account or charged to the employee.
new text end
new text begin Subd. 14. new text end
new text begin Violations; penalty. new text end
new text begin
A violation of this
section is subject to the penalty provided in section 177.32,
subdivision 1.
new text end
Sec. 3. new text begin STUDY; REPORT.
new text end
new text begin
By February 15, 2007, the commissioner of labor and
industry must report to the chairs of the house and senate
committees with jurisdiction over jobs and economic development
on the use of payroll cards.
new text end
Sec. 4. new text begin EFFECTIVE DATE; TERMINATION.
new text end
new text begin
This act is effective the day following final enactment.
The amendments made by section 1, and sections 2 and 3 expire
May 31, 2007.
new text end