A court in Luzerne County, Pennsylvania has suggested that a decision by the state’s department of labor can be the “ultimate resolution” to a class action’s legal matter. In the class action, Siciliano v. Mueller, employees claimed that their employer violated the Pennsylvania Wage Payment and Collection Law by mandating to receive their payment of wages using a payroll card.
As stated in the Wage Payment and Collection Law, employers must pay their employees using “lawful money of the United States or check.” The main question during the court case was whether payroll cards can be equivalent to money or checks. The defendants argued that payroll cards are equivalent to checks as these are issued by the bank and can be used to withdraw on demand. The plaintiffs, on the other hand, argued that payroll cards are neither “lawful money” nor “checks,” as these can only be turned into money when withdrawing from a bank or ATM.
The county court decided that payroll cards did not meet the legal definition of “lawful money of the United States or check” and requested an immediate appeal. The court stated that “Pennsylvania employers and wage-earners could benefit from the Department of Labor and Industry expressing a formal position on the matter.” Moving forward, employers paying their employees with payroll cards or that are considering using them, must do so with caution. Compliance Poster Company will continue to monitor Pennsylvania’s legislation for any new developments on this matter.