Direct Deposit Law

[Picaworth]

My employer is going to direct deposit. Does he need to offer another alternative, i.e. a paper check, or can he mandate the direct deposit for everyone? We process for 5 different states. Utah, Alabama, Tennessee, Florida and Louisiana. If a paper check is still an option, that check must be received by the employee on the pay date, correct? The employer can't mail it to the employees office and just hope it gets there...right? Also, if pay dates are to be changed is the employer required to give any kind of notice that these dates will be changed? Thank you for your time!  

[Alden]

On mandated direct deposit:\

Utah: The employee must authorize the program unless the employer has federal employment taxes of 250,000 or more in prior year and 2/3 of employees are using direct deposit than it can be mandated.  The employee must incur no added fees and the employee must be allowed to choose the financial institution to which the funds are deposited. Utah Code 34-28-3.

Alabama: This state has no direct deposit provision at all. The employee must be allowed to choose the financial institution under Federal regulation E. Otherwise it is left up to the company.

Tennessee: May mandate direct deposit. The employee must be allowed to choose the institution where the funds will be deposited under Federal regulation E.

Florida: Employee must authorize the program except for state appointed employees. Employee must be allowed to choose financial institution where funds will be deposited. Florida statute 17.076, 110.113, 32.04.

Louisiana: Direct deposit may be mandated. The employee cannot incur bank processing charges and must be allowed to choose the financial institution to which funds are deposited under Federal regulation E. LA statute R.S. 23:635.

If a paper check is an option the requirement is that it be at least mailed on the payroll date. It is not required that it is received on the payroll date.

Pay date changes are to be communicated to employees before any work is done under the new pay period the same as pay changes. Shirley