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- ITEM: Unemployment benefits from the state of California shall no longer be paid to recipients by check, but through a debit card provided by Bank of America.
- ITEM: Bank of America will now begin imposing a $5/month fee on debit card withdrawals.
(n.b. Here are a couple of posts from the California Labor Federation – Bank of America: A Unique Display of Corporate Greed, and Payroll Debit Cards: Less Choice, Lower Wages — that should help people catch up on events if they missed last Friday’s announcement and its aftermath.)
- PRESUMPTION: B of A receives some sort of compensation from the state for providing the debit card service, which saves the state the cost of processing and mailing checks.
- PRESUMPTION: Whatever government officials negotiated this arrangement with B of A did not know that it would begin charging a fee constituting 1% of the benefit of a recipient who receives $125 per week.
- QUESTION: Does, or can, the state ensure that the cards used by unemployment recipients (and perhaps other benefit recipients, for all I know) are exempted from B of A’s new policy?
- QUESTION: If it can, will it? When? If if can’t, does this program continue as is? After all, if B of A can impose a $5 monthly fee on these benefits, from which (to my knowledge) recipients cannot opt out, why not a $50 fee? At some point, this would have to come to a head. What better time than now?
Well, if you didn’t click those links to the Cal Labor Fed pieces, I’ll bring some of what they say here to you:
SB 931 (Evans) would authorize payroll cards, but only when the cardholder agreements meet certain conditions. For example, the card contracts couldn’t charge fees to load a payroll card or participate in the program. Card contracts will also no longer be allowed to charge workers for access to online account information and transaction histories. SB 931 guarantees an employee’s free choice between a paper check, direct deposit, or payroll card, and establishes the right of a payroll card-compensated worker to withdraw all wages once with no fees. Workers under SB 931 are also allowed four free in-network withdrawals, one free out-of-network withdrawal, and two free point of sale transactions. Modest protections, to be sure, but even these minimal standards would mean major help for minimum wage and low-wage workers.
Good news for employees, if the Guv signs it. But — what about for unemployees?