CFPB Warns Employers Against Exclusive Use Of Payroll Cards

The CFPB has published a bulletin expressing its view that employers cannot require their employees to receive wages on a payroll card. The bulletin also gives the CFPB’s view on some of the federal consumer protections that apply to payroll cards, such as fee disclosure, access to account history, limited liability for unauthorized use, and error resolution rights.

With some limited exceptions, the CFPB has authority to enforce the Electronic Funds Transfer Act and Regulation E against anyone who violates them, including employers and the financial institutions that issue payroll cards. The Bureau intends to use its enforcement authority to stop violations before they grow into systemic problems, maximize remediation to consumers, and deter future violations. The Bureau also has supervisory authority over larger depository institutions engaged in, among other things, providing payroll cards. The Bureau stated it will be looking to ensure that entities comply with federal consumer financial laws.

Topics:  CFPB, Employer Liability Issues, Minimum Wage, Payroll Cards, Wages

Published In: Consumer Protection Updates, Finance & Banking Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Stinson Leonard Street - Dodd-Frank and the Jobs Act | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »