Payroll Bank Deposits
Payroll Bank Deposits,
The standard payroll bank deposits policy would have included the following:
All payroll deposits should be made at the employees request except Federal Income Tax and Social Security. All requests should be made in writing and signed by employee. The necessary forms should be available in the enterprises HR Department.
We are in the threshold of change regarding payroll deposits because of technology combined with the economy.
First the term payroll deposits correctly and technically stated is called an EFT. EFT is called Electronic Funds Transfer which is the transfer of funds from an employer to a participating bank or a payroll pay card to replace payday. The administrations of this EFT program take some time for the processing which requires collecting certain employee information (authorization form).
Also along with the enrollment form a voided check is required. It is possible for the employee to have multiple accounts at the one financial institutions or ones. In order for the institutions to be part of the multiple chains of payroll deposits it must be a member of the Automated Clearing House.
Many institutions are beginning to make it mandatory that employees participate in payroll. Social Security for one is making that all of its retirees be paid through payroll deposits. The rationale for such change is that it saves money by cutting costs associated with paper making checks. It is also another form of spoils when a Politician get elected they influence the selection of Banks to receive the payroll deposits. If we leave it to the Politicians they would select real estate listings for all. They already directly influence housing for the poor and homeless.
The big question is whether it is legal regarding making payroll deposits mandatory. I am not a lawyer, but because many employers are offering their employees a choice, meaning a payroll deposit over a pay card instead of a check, cash or money is what makes it acceptable possible legal. Many employers cite the following advantages: diminished fraudulent checks, payroll tax deposits filed for the employee, the filing of tax reports, more proficiency because of time savings, economies of scale because of reduced cost, and lower risk of making mistakes.