PA Law on Payroll Card Use

Last November, Pennsylvania Governor Tom Wolf signed into law the Payroll Cards (pay cards) Bill S.B. 1265.  This law became effective May 3, 2017.  Until it was passed, there were no explicit regulations surrounding pay card use in Pennsylvania.  Most businesses treated the use of pay cards with the same regulations as direct deposits. 

The prior regulations included in Pennsylvania Stat. 7.6121 & 7.6122:

  • Direct deposit cannot be required by the employer
  • Direct deposit must be signed for in writing (or electronic signature)
  • The employee must receive a detailed pay statement
  • Bank of deposit must be at the sole discretion of the employee
  • The employee can withdraw consent and receive a paper check within a reasonable amount of time

The new law goes into additional details specific to payroll cards.  They include:

  • Pay cards must comply with Federal law 12 CFR Part 1005 on electronic funds transfers (Regulation E)
  • Funds must be with an FDIC-insured institution
  • Pay cards cannot be a condition of employment or required for receipt of benefits
  • Notice must be issued to the employee with:
    • Wage payment options
    • Terms, conditions and fees for pay card account option
    • Notice of third-party fee assessments
    • Methods for accessing funds without fees
  • Pay cards must
    • Allow employee at least one free withdraw per pay period
    • Permit one in-network ATM withdraw each pay period
    • Provide means of assessing balance via phone or internet
    • Never cause funds to expire
  • Pay card providers cannot charge fees for:
    • Application or initiation of card
    • Issuance of initial card
    • One replacement card per calendar year
    • Transfer of wages from employer to employee
    • Purchase transactions at point of sale
    • Non-use or inactivity fees for less than 12 months in duration
  • Nothing included in this law should override the terms of any collective bargaining agreement.

If you have any questions about the use or implementation of a payroll card program, contact Tina M. Frysinger at 412.697.5209 or

Visit the “Our Thoughts On” blog for additional state and local tax updates as they become available 

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2020 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on

Pennsylvania EITC Applications Open May 15
Pennsylvania Education Tax Credits and COVID-19
Pennsylvania Tax Officials State that Teleworkers Will Not Create Nexus for State Taxes
Pennsylvania Department of Revenue Temporarily Suspends Some IFTA Requirements Due to COVID -19 Pandemic
Pennsylvania Board of Appeals Operation Guidelines during COVID-19 Pandemic
A Summary of Pennsylvania’s New Tax Deadlines

Register to receive our weekly newsletter with our most recent columns and insights.

Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us

contact us

Map of Pittsburgh Office

One PPG Place, Suite 1700
Pittsburgh, PA 15222
p:412.261.3644     f:412.261.4876

Map of Columbus Office

65 East State Street, Suite 2000
Columbus, OH 43215
p:614.621.4060     f:614.621.4062

Map of Washington Office
Washington, D.C.

1660 International Drive, Suite 600
McLean, VA 22102