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This question is about employer.
Can an employer require direct deposit?
Yes, an employer can require direct deposit. Federal and state laws vary greatly concerning the circumstances by which this rule can be enforced.
The Electronic Fund Transfer Act of 1978 allows employers to require that employees are paid electronically through direct deposit. At the federal level, this can only take place if the employer allows the employee to choose the banking institution where wages will be deposited. If an employer wishes to choose the bank, then they must provide employees with an alternate payment option.
State regulations regarding direct deposit can be very different. States including Michigan, Arizona, and Kentucky allow employers to mandate employee participation in direct deposit. States, including California, New York, and Oregon, do not give employers the ability to mandate participation.
Still, other states, including Minnesota and West Virginia, identify specific sectors that are subject to direct deposit regulations. In Minnesota, no private sector employees are required to participate, but public state employees can be mandated to participate. In West Virginia, employees of higher learning institutions are subject to this requirement, while employees governed by the WPCA are not.
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