Direct Deposit of Wages
Wisconsin labor standards laws do not directly address the issue of direct deposit of wages. However, several laws have an indirect impact on how direct deposit programs may be used.
Mandatory Direct Deposit
Mandatory direct deposit systems are permitted under certain circumstances:
The employee must be able to collect his or her wages at a bank or facility in the State of Wisconsin.
The employee must receive all of his or her wages, and cannot be made to incur any charges to receive them. If an employee uses an existing bank account, generally this will cause no problem. If an employee does not bank, and has to establish an account solely for the purpose of receiving wages, all fees must be covered by the employer.
Voluntary Direct Deposit
If an employer chooses to institute a direct deposit pay system that is available at the option of the employee, it is immaterial whether or not there are fees associated with obtaining the wages. If the employee chooses to use the direct deposit system, it is assumed that the employee has agreed to pay these fees for the convenience and security of having the wages placed directly into his or her bank account.
Direct Deposit as a Condition of Employment
Because this issue is not addressed in the statutes, an employer may make employee participation in a direct deposit pay program a condition of employment. An employer may also require that established employees participate in a direct deposit system as a condition of continued employment.
Wisconsin Statutes 103.45
Wisconsin Statutes 103.45, states that wages paid in a method other than cash must be paid "in some designated place of business in the county in which the work was performed, or at the office of the person paying the wages if within this state, or at any bank within this state." This means that a direct deposit system must utilize a Wisconsin facility unless the employee voluntarily chooses a facility that is located outside of the state.
Wisconsin Statutes 109.03(1)
Wisconsin Statutes 109.03(1) requires an employer to make timely payments to workers, and that wages be paid in full on the corresponding pay date. This means that a mandatory direct deposit system must provide a worker with 100% of his or her wages without the worker incurring any cost to gain access to their pay (check fees, service charges on an account, etc.).