| 11 | 11 | | |
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| 12 | 12 | | AN ACT ALLOWING EMPLOYERS TO PAY WAGES USING PAYROLL CARDS. |
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| 13 | 13 | | |
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| 14 | 14 | | Be it enacted by the Senate and House of Representatives in General Assembly convened: |
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| 15 | 15 | | |
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| 16 | 16 | | Section 1. (NEW) (Effective October 1, 2012) (a) As used in this section: |
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| 17 | 17 | | |
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| 18 | 18 | | (1) "Direct deposit" means the payment of an employee's wages, salary or other compensation by credit to such employee's account in any bank which has agreed with the employer to accept such wages, salary or other compensation; |
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| 19 | 19 | | |
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| 20 | 20 | | (2) "Payroll card" means a stored value card or other device used by an employee to access wages from a payroll card account, but does not mean a gift certificate, as defined in section 3-56a of the general statutes; and |
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| 21 | 21 | | |
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| 22 | 22 | | (3) "Payroll card account" means an account that is directly or indirectly established through an employer and to which transfers of the employee's wages, salary or other compensation are made and accessed through the use of a payroll card. |
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| 23 | 23 | | |
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| 24 | 24 | | (b) An employer may require direct deposit of an employee's wages, salary or other compensation or the use of a payroll card account to deliver wages, salary or other compensation to employees, provided: |
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| 25 | 25 | | |
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| 26 | 26 | | (1) An employee hired before October 1, 2012, consents, in writing or electronically, to the direct deposit of such employee's wages, salary or other compensation or the payment of wages, salary or other compensation using a payroll card account; and |
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| 27 | 27 | | |
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| 28 | 28 | | (2) An employee hired on or after October 1, 2012: |
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| 29 | 29 | | |
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| 30 | 30 | | (A) Is given a form that, in clear and conspicuous language, allows the employee the option of receiving wages, salary or other compensation by direct deposit to his or her personal account at a financial institution or to a payroll card account; and |
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| 31 | 31 | | |
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| 32 | 32 | | (B) Is notified, in clear and conspicuous language, that failure to return the form provided pursuant to subparagraph (A) of this subdivision to the employer in time to process the employee's initial wage, salary or other compensation payment with the information necessary to implement direct deposit will be considered consent to receiving wages, salary or other compensation through a payroll card account. |
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| 33 | 33 | | |
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| 34 | 34 | | (c) An employee shall be allowed to make at least one withdrawal or transfer each pay period without charge for any amount deposited to the payroll card account by the employer up to and including the full amount of the employee's wages, salary or other compensation for that pay period. |
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| 35 | 35 | | |
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| 36 | 36 | | (d) None of the employer's costs associated with paying wages, salary or other compensation using a payroll card or establishing the payroll card account shall be deducted from or charged against the wages, salary or other compensation delivered to the employee. |
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| 37 | 37 | | |
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| 38 | 38 | | (1) Neither the employer nor the card issuer shall charge the employee fees for (A) issuing a payroll card, (B) transferring wages, salary or other compensation onto the payroll card, (C) providing one replacement card per year, if needed, during the employee's employment with the employer and for sixty days after the termination of such employment with the employer, or (D) any inactivity or dormancy of the payroll card account. |
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| 39 | 39 | | |
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| 40 | 40 | | (2) A payroll card may bear an expiration date, provided (A) the funds on the card do not expire, and (B) prior to the expiration date, the employee is provided with a replacement card, without charge, during the employee's employment with the employer and for sixty days after the termination of such employment with the employer. |
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| 41 | 41 | | |
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| 42 | 42 | | (e) The payroll card account may escheat pursuant to section 3-57a of the general statutes. |
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| 43 | 43 | | |
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| 44 | 44 | | (f) An employer shall provide the employee a means of checking his or her account balances in the payroll account through an automated telephone system and electronically without cost to the employee. |
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| 45 | 45 | | |
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| 46 | 46 | | (g) Prior to obtaining consent from the employee under subdivision (1) of subsection (b) of this section, or, for an employee hired on or after October 1, 2012, prior to an employer requiring the use of payroll card accounts to deliver wages, salary or other compensation to the employee, the employer shall provide the employee with clear and conspicuous notice, in writing, and in the language the employer normally uses to communicate employment-related polices to his or her employees, of the following items: |
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| 47 | 47 | | |
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| 48 | 48 | | (1) The terms and conditions relating to the use of the payroll card, including a list of fees that may be assessed by the card issuer; |
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| 49 | 49 | | |
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| 50 | 50 | | (2) The methods available to the employee for accessing his or her full wages, salaries or other compensation in lawful money of the United States of America without any transaction fee to the employee for such access; |
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| 51 | 51 | | |
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| 52 | 52 | | (3) The methods available to the employee for checking his or her balances in the payroll card account without cost; |
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| 53 | 53 | | |
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| 54 | 54 | | (4) A statement as to whether third parties may assess additional fees; and |
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| 55 | 55 | | |
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| 56 | 56 | | (5) The means, other than a payroll card account, by which an employee is entitled to receive payment of wages, salary or other compensation. |
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| 57 | 57 | | |
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| 58 | 58 | | (h) Neither the payroll card nor the payroll card account shall be linked to any form of credit. No fees or interest may be imposed upon the employee for an overdraft or a declined transaction. |
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| 59 | 59 | | |
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| 60 | 60 | | (i) The employer shall furnish the employee with a statement of deductions made from his or her wages, salary or other compensation for each pay period in accordance with section 31-13a of the general statutes, as amended by this act. |
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| 61 | 61 | | |
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| 62 | 62 | | (j) Each employee with a payroll card account shall be permitted, on timely notice to the employer and without cost, reprisal, discrimination or other penalty, to receive his or her wages, salary or other compensation by direct deposit into a personal account at a financial institution. The employer shall begin payment by direct deposit not later than fourteen days after receiving both the employee's request and the account information necessary to make the deposit. |
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| 63 | 63 | | |
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| 64 | 64 | | (k) Each employee with a payroll card shall be provided with access to the terms and conditions relating to the use of the payroll card, including the current schedule of fees. This requirement may be satisfied (1) by posting such terms and conditions clearly and conspicuously on a web site accessible to the employee at any time, and (2) upon the employee's request, (A) by providing electronic notice to the employee to the address at which the employer regularly communicates other types of employment information to the employee, (B) by mailing notice to the employee at his or her last-known mailing address, (C) by distributing the notice directly to the employee in the employer's place of business, or (D) through other means used by the employer to distribute employment-related information and notices individually to employees. |
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| 65 | 65 | | |
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| 66 | 66 | | (l) Each employee with a payroll card shall be provided written notice of any change in a term or condition required to be disclosed, at least twenty-one days before the effective date of such change, if such change would result in: (1) Increased fees for the employee, (2) increased liability for the employee, (3) fewer types of available electronic fund transfers, or (4) any stricter limitation on the frequency or dollar amount of transfers, except that such notice is not required if an immediate change in terms or conditions is necessary to maintain or restore the security of the payroll card, the payroll card account or an electronic fund transfer system. If such change is made permanent and disclosure would not jeopardize the security of such card, account or system, the employee shall be notified, in writing or electronically, within thirty days after making the change permanent. |
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| 67 | 67 | | |
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| 68 | 68 | | (m) Each employee with a payroll card shall have access to a history of his or her payroll account transactions that covers at least the sixty days prior to the date the employee accesses such history. The employer shall provide each employee with either (1) a confidential means of accessing such information electronically, along with the ability to print the transaction history without cost, or (2) a means for the employee to receive a written transaction history once a month from the card issuer without cost. |
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| 69 | 69 | | |
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| 70 | 70 | | (n) Wages, salary or other compensation paid to an employee using a payroll card shall be maintained in an account that is insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration on a pass-through basis to the employee. |
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| 71 | 71 | | |
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| 72 | 72 | | (o) A payroll card account that is used to receive only employee wages, salary or other compensation shall be exempt from execution under section 52-367b of the general statutes in accordance with subsection (f) of section 52-361a of the general statutes. |
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| 73 | 73 | | |
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| 74 | 74 | | (p) All notices required by this section shall be clear and conspicuous. |
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| 75 | 75 | | |
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| 76 | 76 | | (q) Nothing in this section shall be construed to preempt or override the terms of any collective bargaining agreement with respect to methods of an employer's payment of wages, salary or other compensation due to employees. |
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| 77 | 77 | | |
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| 78 | 78 | | (r) Nothing in this section shall be construed to restrict the fees that a payroll card issuer may charge the employer pursuant to a payroll card agreement between the payroll card issuer and the employer, provided those fees are not charged to or passed onto any employee. |
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| 79 | 79 | | |
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| 80 | 80 | | (s) The Labor Commissioner may adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to ensure compliance with this section. |
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| 81 | 81 | | |
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| 82 | 82 | | Sec. 2. Subsection (a) of section 31-71b of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012): |
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| 83 | 83 | | |
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| 84 | 84 | | (a) (1) Except as provided in subdivision (2) of this subsection, each employer, or the agent or representative of an employer, shall pay weekly all [moneys] wages, salary or other compensation due each employee on a regular pay day, designated in advance by the employer [, in] using one or more of the following methods: (A) In cash, (B) by negotiable checks, or [, upon an employee's written request, by credit to such employee's account in any bank that has agreed with the employer to accept such wage deposits] (C) by direct deposit or on a payroll card, provided the requirements of section 1 of this act are satisfied. |
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| 85 | 85 | | |
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| 86 | 86 | | (2) Unless otherwise requested by the recipient, the Comptroller shall, as soon as is practicable, pay all wages due each state employee, as defined in section 5-196, by electronic direct deposit to such employee's account in any bank, Connecticut credit union or federal credit union that has agreed with the Comptroller to accept such wage deposits. |
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| 87 | 87 | | |
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| 88 | 88 | | Sec. 3. Section 31-13a of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012): |
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| 89 | 89 | | |
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| 90 | 90 | | (a) With each wage payment each employer shall furnish to each employee, in writing or electronically, a record of hours worked, the gross earnings showing straight time and overtime as separate entries, itemized deductions and net earnings, except that the furnishing of a record of hours worked and the separation of straight time and overtime earnings shall not apply in the case of any employee with respect to whom the employer is specifically exempt from the keeping of time records and the payment of overtime under the Connecticut Minimum Wage Act or the Fair Labor Standards Act. |
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| 91 | 91 | | |
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| 92 | 92 | | (b) If the record of hours is furnished electronically pursuant to subsection (a) of this section, the employer shall provide a means for each employee to access and print the information without cost to the employee. Any information contained in the record furnished electronically pursuant to subsection (a) of this section shall incorporate safeguards to ensure the confidentiality of an employee's personal information. |
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| 93 | 93 | | |
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| 94 | 94 | | |
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| 95 | 95 | | |
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| 96 | 96 | | |
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| 97 | 97 | | This act shall take effect as follows and shall amend the following sections: |
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| 98 | 98 | | Section 1 October 1, 2012 New section |
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| 99 | 99 | | Sec. 2 October 1, 2012 31-71b(a) |
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| 100 | 100 | | Sec. 3 October 1, 2012 31-13a |
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| 101 | 101 | | |
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| 102 | 102 | | This act shall take effect as follows and shall amend the following sections: |
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| 103 | 103 | | |
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| 104 | 104 | | Section 1 |
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| 105 | 105 | | |
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| 106 | 106 | | October 1, 2012 |
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| 107 | 107 | | |
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| 108 | 108 | | New section |
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| 109 | 109 | | |
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| 110 | 110 | | Sec. 2 |
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| 111 | 111 | | |
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| 112 | 112 | | October 1, 2012 |
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| 113 | 113 | | |
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| 114 | 114 | | 31-71b(a) |
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| 115 | 115 | | |
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| 116 | 116 | | Sec. 3 |
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| 117 | 117 | | |
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| 118 | 118 | | October 1, 2012 |
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| 119 | 119 | | |
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| 120 | 120 | | 31-13a |
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| 121 | 121 | | |
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| 122 | 122 | | |
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| 123 | 123 | | |
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| 124 | 124 | | LAB Joint Favorable Subst.-LCO |
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| 125 | 125 | | BA Joint Favorable |
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