Senate File 415 - Introduced



                                       SENATE FILE       
                                       BY  GRONSTAL and IVERSON


    Passed Senate, Date               Passed House,  Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to the direct deposit of wages paid by an
  2    employer, requiring a regular payday statement, and making a
  3    civil penalty applicable.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  5 TLSB 3661SS 81
  6 kh/pj/5

PAG LIN



  1  1    Section 1.  Section 91A.3, subsection 3, Code 2005, is
  1  2 amended to read as follows:
  1  3    3.  The wages paid under subsection 1 shall be sent to the
  1  4 employee by mail or be paid at the employee's normal place of
  1  5 employment during normal employment hours or at a place and
  1  6 hour mutually agreed upon by the employer and employee, or the
  1  7 employee may elect to have the wages sent for direct deposit
  1  8 into a financial institution designated by the employee.  An
  1  9 employer shall not require a current employee to participate
  1 10 in direct deposit.  However, the employer may require, as a
  1 11 condition of hire, a new employee to sign up for direct
  1 12 deposit of the employee's wages in a financial institution of
  1 13 the employee's choice unless the costs to the employee of
  1 14 establishing and maintaining an account for purposes of the
  1 15 direct deposit would effectively reduce the employee's wages
  1 16 to a level below the minimum wage provided under section
  1 17 91D.1.
  1 18    Sec. 2.  Section 91A.6, Code 2005, is amended by adding the
  1 19 following new subsection:
  1 20    NEW SUBSECTION.  4.  On each regular payday, the employer
  1 21 shall send to each employee by mail or shall provide at the
  1 22 employee's normal place of employment during normal employment
  1 23 hours a statement showing the hours the employee worked, the
  1 24 wages earned by the employee, and deductions made for the
  1 25 employee.
  1 26                           EXPLANATION
  1 27    This bill permits an employer to direct deposit an
  1 28 employee's wages into a financial institution of the
  1 29 employee's choice if the employee authorizes direct deposit.
  1 30 The bill also requires an employer to provide each employee,
  1 31 on each regular payday, with a statement showing the hours the
  1 32 employee worked, the wages earned by each employee, and
  1 33 deductions made for the employee.
  1 34    The bill prohibits employers from requiring current
  1 35 employees to direct deposit their wages, but allows an
  2  1 employer to require new employees, as a condition of hire, to
  2  2 use direct deposit unless the costs of establishing and
  2  3 maintaining such an account effectively reduce the employee's
  2  4 hourly wage rate to a level below that of the state's minimum
  2  5 wage requirements.
  2  6    An employer who violates the provisions of the Code chapter
  2  7 this bill amends, chapter 91A, or the rules promulgated under
  2  8 the chapter, is subject to a civil penalty.
  2  9 LSB 3661SS 81
  2 10 kh:nh/pj/5