Will Bank of America be Receiving Unemployment Benefits?




Old BankAmericard logo

Come on, folks, who needs those unemployment benefits more -- you or our bank?

  • 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?

About Greg Diamond

Somewhat verbose attorney, semi-retired due to disability, residing in northwest Brea. Occasionally runs for office against bad people who would otherwise go unopposed. Got 45% of the vote against Bob Huff for State Senate in 2012; Josh Newman then won the seat in 2016. In 2014 became the first attorney to challenge OCDA Tony Rackauckas since 2002; Todd Spitzer then won that seat in 2018. Every time he's run against some rotten incumbent, the *next* person to challenge them wins! He's OK with that. Corrupt party hacks hate him. He's OK with that too. He does advise some local campaigns informally and (so far) without compensation. (If that last bit changes, he will declare the interest.)