McDonalds sued for debit card pay plan

[PhilosopherOfSorts]

Firstly, thanks for the replies. It certainly given me a better understanding of the situation. However if some banks

a) require a minimum deposit of $25 USD to set up an account, and
b) banking hours are not conduicive to setting up an account as they clash with working hours..

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

I've never seen a bank with an opening deposit that low, every bank I've ever used required at least $100 to open an account.

As far as holidays go, its more likely that the banks will be closed than it is that you'll get the day off. Where I work, for example, the only holiday we close for is Christmas, and some places don't even close then.

My work just switched to paying us on a card, and the fees are outrageous. Wanna check your balance at an ATM? There's a fee for that. Wanna transfer money into your actual bank account? There's a fee for that. Wanna use cash for anything? There's a fee for that. Wanna just use the card like a credit card and blithely spend all of your money? That's free, until you overdraw, then oh, boy, is there a fee.

[Jub]

Firstly, thanks for the replies. It certainly given me a better understanding of the situation. However if some banks

a) require a minimum deposit of $25 USD to set up an account, and
b) banking hours are not conduicive to setting up an account as they clash with working hours..

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

I've never seen a bank with an opening deposit that low, every bank I've ever used required at least $100 to open an account.

As far as holidays go, its more likely that the banks will be closed than it is that you'll get the day off. Where I work, for example, the only holiday we close for is Christmas, and some places don't even close then.

My work just switched to paying us on a card, and the fees are outrageous. Wanna check your balance at an ATM? There's a fee for that. Wanna transfer money into your actual bank account? There's a fee for that. Wanna use cash for anything? There's a fee for that. Wanna just use the card like a credit card and blithely spend all of your money? That's free, until you overdraw, then oh, boy, is there a fee.

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

[bilateralrope]

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

If McDonald's agreed with you, there would be no need for the lawsuit.

[Jub]

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

If McDonald's agreed with you, there would be no need for the lawsuit.

That might simply be a single branch as it's a franchise and not a centralized company. If there is no other option then the US is well and truly a special kind of stupid.

[PhilosopherOfSorts]

Firstly, thanks for the replies. It certainly given me a better understanding of the situation. However if some banks

a) require a minimum deposit of $25 USD to set up an account, and
b) banking hours are not conduicive to setting up an account as they clash with working hours..

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

I've never seen a bank with an opening deposit that low, every bank I've ever used required at least $100 to open an account.

As far as holidays go, its more likely that the banks will be closed than it is that you'll get the day off. Where I work, for example, the only holiday we close for is Christmas, and some places don't even close then.

My work just switched to paying us on a card, and the fees are outrageous. Wanna check your balance at an ATM? There's a fee for that. Wanna transfer money into your actual bank account? There's a fee for that. Wanna use cash for anything? There's a fee for that. Wanna just use the card like a credit card and blithely spend all of your money? That's free, until you overdraw, then oh, boy, is there a fee.

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

I wasn't given an option, I don't think anybody was. It was just "Here, read this pamphlet and activate this card, its how you're getting paid, starting next week."

If I was given the option, I would have stuck with the normal payroll checks that I'd been getting at every job I've had since, ever.

[Jub]

I wasn't given an option, I don't think anybody was. It was just "Here, read this pamphlet and activate this card, its how you're getting paid, starting next week."

If I was given the option, I would have stuck with the normal payroll checks that I'd been getting at every job I've had since, ever.

I'd ask a local lawyer or somebody in a better business bureau if that sort of thing is actually allowed in your city/state. If it isn't then possibly ask the employer if they could not force you to waste money on a fee loaded card just so they can shave a few pennies.

[Rogue 9]

Firstly, thanks for the replies. It certainly given me a better understanding of the situation. However if some banks

a) require a minimum deposit of $25 USD to set up an account, and
b) banking hours are not conduicive to setting up an account as they clash with working hours..

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

Banks are closed on federal holidays, without fail.

[Zaune]

What about Saturdays?

[Korto]

You lot have some amazingly bad bank accounts. For instance, I'm with the "Perm" (Newcastle Permanent Building Society), and they have an opening balance of $1, minimum balance of $1, and you get charged a transaction fee of around 30c only after you use up your 10 free transactions a month. Now, if your balance does become negative, then according to my wife you get a penalty fee of... a penalty fee of... well, nothing. You just can't withdraw any of the money you don't have, and you may owe a few cents of interest.
Of course, I'm with them because I consider them the best in the area, and I had to put a fire under my wife's arse to get her to change from the CBA (Commonwealth Bank of Australia) where they were actually charging her $5 a month.
All atm style bank cards of course give you access to EFTPOS (electronic funds transfer, point of sale), which means your card acts like a debit card at the shop, and any shop that wants to do business has eftpos. There is of course no extra charge for using eftpos (the bank may stick on a transaction fee, but that's separate from eftpos), as the shops don't want to piss their customers off.

Your shit is crap. Really, really, crap.

[Broomstick]

How hard is it to open a credit union account or something, though? Okay, they probably expect a fixed address and proof of US citizenship, but then so do most employers.

You don't have to be a US citizen to open a US bank account. You do need to have valid ID but a passport issued by a foreign government will work just fine.

Credit unions have limited membership eligibility due to reasons I don't want to get sidetracked into. Technically they aren't banks. So, you'll have a CU where you have to be, say, a Federal Employee or a relative of same, or a teacher in a particular school district, or you need to reside in a particular area. That said, provided you meet the membership requirements (which can be quite broad - there's one in my are where the requirements are "live or work or worship or attend school in Porter county, IN or an immediate family member of someone who meets those requirements") all you need is a valid ID.

(The Navy Federal Credit Union should eliminate the problem of military personnel not being able to get accounts due to citizenship since, as of 2008, it is open to ALL US military personnel: active duty, retired, and reserve Army, Navy, Marine Corps, and Air Force personnel, as well as civilian personnel within the Department of Defense. They have also added all military contractors, and the Coast Guard)

This still doesn't solve the problem of low-income people who simply have no bank/CU accounts at all.

America can be amazingly archaic in some ways. I remember people talking about problems with things like rents and bill payment requiring paper cheques to be mailed around the place because there's nothing like PayPoint (which is what most low income people here who can't guarantee money in account for direct debit use, it's a system where you pay through the till at a supermarket or corner shop using whatever means you have, cash, cheque, card, etc. and the money is automatically transferred to the payee, there's no additional costs and the system operates Europe wide).

Would PayPoint work for situations like mine where I rent from a private citizen rather than a corporation? I have to pay my rent in either cash or check because my landlord isn't going to go through the hassle and expense of setting up an electronic payment scheme on his own.

We do have services where you can do what you describe to the extent of paying your utility bills at the local supermarket or corner store but those are private operations and not government services. “Currency Exchanges” are businesses that provide such services, along with check cashing, money orders, money transfers (Western Union) and others, without requiring an account. Of course, they charge fees for such things. Some of the fees are in the 3% range which is arguably reasonable, some places charge considerably more.

No, but there are people who can't afford an account to put direct deposit in.

And your country has no such thing as free bank accounts?

I mean here you can get a current account with no montly charge, no upfront fee, no minimum monthly payin, and minimum starting deposits that go as low as £1 from major international banks like HSBC.

There ARE banks and CU's here that offer such accounts but none of those institutions are compelled to offer them and they are becoming rarer.

This is a silly question, but since I am so used to the direct deposit in my bank account all throughout my working life, and now have been told a lot of poor Americans don't have bank accounts, how do they cash a cheque then without having a bank? Do they just open an account for that day?

There's all sorts of places that will cash a payroll check for a small fee. Either they're dedicated to the job or a side service of grocery stores and such.

Yep. Fees for such check cashing services are typically 3% around my area, although some of them charge a flat rate for check under $100 or some other arbitrary amount.

It used to be almost all banks would also cash non-customer check for a comparable fee, but that is becoming less and less common these days.

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

Typical weekly wages after tax for such a person would be roughly around $230-260 depending on tax rates and “exemptions”. Of course, there will be expenses to be paid out of that, for some getting $25 together can be an issue.

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

Well, yes, American workers do get holidays... during which the banks are closed.

Some workers are able to access banks during their lunch break, or like in my case they have one of the work week days off as a routine matter (I'm off Sundays and Mondays these days) but for workers on rapidly changing shifts it becomes far more difficult to get to the bank and forget being able to make plans in advance. It's not impossible, but there are obstacles.

Banks have reduced hours on Saturdays. And a LOT of low-income workers work on Saturdays. If you're working two part-time jobs you might easily be employed during all banking hours.

Also, I haven't seen an opening balance requirement under $100 for about 30 years now. $500 minimum initial deposit is not unusual.

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

In theory they ARE required to do that, hence the lawsuit.

I think companies just started moving to the card as the exclusive payment method in the past few years and this is the first lawsuit to challenge the move.

[Korto]

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

There is of course a limit to how much "demanding" you feel you can do when you're poor, unskilled, and easily replaced.

[Jub]

The way banking seems to work here in British Columbia is kind of a hybrid of the US and the Aussie ways of doing things. I've never had a credit check or minimum balance to open an account and there are variable fee structures depending on what you want to do with your account. A $15/month fee is pretty standard and there are small fees for online money transfers (I pay my rent via email as an example and the fee is a dollar). My total bank fees with a basic chequing and savings account come to $16/month, I'd pay more if I wanted things like overdraft, but my account came with a debit credit card for online shopping which saves me the risk of getting a proper card and the hassle of a prepaid card.

I would never dream of not having a bank account and most people look at you funny if you want anything other than direct deposit. I'd be livid if any employer tried to pay me on a fee laden card. Then again, we have strong central banks and not the crazy regional system that the US seems to favor and that likely drives banking costs for businesses down by a fair margin.

Why not demand an alternate form of payment such as direct deposit, cash, or a cheque? I'm pretty sure they have to pay you in other ways.

There is of course a limit to how much "demanding" you feel you can do when you're poor, unskilled, and easily replaced.

Obviously, still if you just sit and take it they won't feel a need to worry the next time they unilaterally decide to make things worse. Of course what I would do knowing I have a reasonable social safety net and what a US citizen would do are likely different.

[Zaune]

How hard is it to open a credit union account or something, though? Okay, they probably expect a fixed address and proof of US citizenship, but then so do most employers.

You don't have to be a US citizen to open a US bank account. You do need to have valid ID but a passport issued by a foreign government will work just fine.

Credit unions have limited membership eligibility due to reasons I don't want to get sidetracked into. Technically they aren't banks. So, you'll have a CU where you have to be, say, a Federal Employee or a relative of same, or a teacher in a particular school district, or you need to reside in a particular area. That said, provided you meet the membership requirements (which can be quite broad - there's one in my are where the requirements are "live or work or worship or attend school in Porter county, IN or an immediate family member of someone who meets those requirements") all you need is a valid ID.

Ah, I see. Sorry about that, I was under the impression that a credit union was roughly equivalent to a building society in the UK.

And I believe Paypoint can be used to pay rent to a prvate citizen, but only if they're using a third-party property management service who deal with repairs and the like in return for a cut of the rent. It tends to be largely academic in practice though, as renting anywhere that's not a tiny apartment and/or part of our remaining public housing stock runs to four figures a month.

There is of course a limit to how much "demanding" you feel you can do when you're poor, unskilled, and easily replaced.

That's what picket lines are for.

[Vendetta]

Would PayPoint work for situations like mine where I rent from a private citizen rather than a corporation? I have to pay my rent in either cash or check because my landlord isn't going to go through the hassle and expense of setting up an electronic payment scheme on his own.

We do have services where you can do what you describe to the extent of paying your utility bills at the local supermarket or corner store but those are private operations and not government services. “Currency Exchanges” are businesses that provide such services, along with check cashing, money orders, money transfers (Western Union) and others, without requiring an account. Of course, they charge fees for such things. Some of the fees are in the 3% range which is arguably reasonable, some places charge considerably more.

If you rent directly from an individual, probably not.

Though if they deal with their rents through a letting agency (most landlords in the UK do, because it means they can fuck off to spain with the rest of their kind) it depends on whether the agency deals with paypoint.

Paypoint isn't a government operation either, it's a private company that operates in quite a lot of europe, and there are no fees to the payer, the amount on your bill is the amount you pay. The fees are on the payee for their access to the Paypoint system.

I have a suspicion that this means they save money in the long term because they don't have to deal with people who don't have guaranteed balance for direct debits mailing in cheques or cash and dealing with the administration that amount of paperwork will cause, and a convenient way to pay with no extra fees means that people are less likely to default on payment because they make paying easy, so they have less costs on debt recovery as well.

Well, yes, American workers do get holidays... during which the banks are closed.

He's not talking about federal holidays. He's talking about annual leave, as in take a holiday whenever you want it. Now, I understand that US workers technically get something called annual leave but most are under significant pressure not to take it.

In the UK, for instance, your employer must allow you to take your annual leave, in fact, if they don't they have to compensate you at a significantly increased rate. Most employers will force you to take your leave allowance to avoid this, as in if you haven't used it up near the end of the holiday year it will be booked in for you and you will be told not to come to work on those days.



For reference on bank account charges, a basic bank account from my bank in the UK has no charges on anything other than banker's drafts and automated monthly account transfers (though it doesn't offer any overdraft facility and you can't use it abroad). There's no charge or minimum deposit to open the account, you just need to be 18, have proof of identity, and agree to a credit reference search. Even on the more full featured account the only charges are for using ATMs outside the UK (in the UK there's no charge from the bank for using an ATM, and ATMs that charge at point of use died out as soon as someone made theirs free) and for exceeding the overdraft limit.

Though these are current accounts which also pay no interest.

[AMT]

I wasn't given an option, I don't think anybody was. It was just "Here, read this pamphlet and activate this card, its how you're getting paid, starting next week."

If I was given the option, I would have stuck with the normal payroll checks that I'd been getting at every job I've had since, ever.

I'd ask a local lawyer or somebody in a better business bureau if that sort of thing is actually allowed in your city/state. If it isn't then possibly ask the employer if they could not force you to waste money on a fee loaded card just so they can shave a few pennies.

Maybe you can do a lawsuit like the McDonalds lady. With her doing it this would be a good time to challenge this shit elsewhere

[mr friendly guy]

Firstly, thanks for the replies. It certainly given me a better understanding of the situation. However if some banks

a) require a minimum deposit of $25 USD to set up an account, and
b) banking hours are not conduicive to setting up an account as they clash with working hours..

1. How difficult is it to save $25 (or a bit more than that) for the minimum deposit. Presumably there are no fees involved once you have the minimum deposit unless its overdrawn etc. How much is a payday for someone on $15 K a year after tax?

2. Can't someone either get a relative to set up the account (joint account maybe), or set up the account in your holidays? Don't tell me America doesn't give its workers holidays.

Banks are closed on federal holidays, without fail.

Maybe I wasn't clear. When I say holidays I wasn't referring to public holidays (I guess you guys call them federal holidays), I was referring to annual leave which your employer gives you. If you have say one week leave, then you can set up the bank account then with all the money you saved. Please tell me American employers for the low income workers give their workers annual leave.

[mr friendly guy]

Would PayPoint work for situations like mine where I rent from a private citizen rather than a corporation? I have to pay my rent in either cash or check because my landlord isn't going to go through the hassle and expense of setting up an electronic payment scheme on his own.

While I can't speak for the UK, in Australia I am a land lord and my tenant pays money to a property manager who then debits it electronically into my nominated bank account. Now theoretically if I managed the property myself, I could arrange with the tenant to do the same thing, but I really need a property manager for all those other things, including chasing up rent etc.

On another note, I just have to echo Korto... you Americans get screwed by your banks period. I thought Australian banks were bad charging us for withdrawing money from another institutions ATM, but geez. My bank account has zero interest, but zero fees as well. It allows direct debit from my employer and it can cash cheques from other institutions for... free. I can also view my account online and get it linked to other accounts, eg home loan and investment loan accounts (if its from the same bank) and also linked to other saving accounts (if its from another instition).

[TimothyC]

On another note, I just have to echo Korto... you Americans get screwed by your banks period. I thought Australian banks were bad charging us for withdrawing money from another institutions ATM, but geez. My bank account has zero interest, but zero fees as well. It allows direct debit from my employer and it can cash cheques from other institutions for... free. I can also view my account online and get it linked to other accounts, eg home loan and investment loan accounts (if its from the same bank) and also linked to other saving accounts (if its from another instition).

Yeah, we do get screwed by our banks on a regular basis. Now, if you can get into a good credit union (or one of the rare good banks such as USAA) you're better off. I've actually got a no-fee Bank account with no minimum balance and global free ATM use (they even refund originating ATM fees), but I am in a very distinct minority.

[LaCroix]

Screwed is put mildly - I once wired money to someone in the US, paying all applying fees at the time on giving the order, adding 40$ on top of a 200$ amount.
Get a call a few days later, they only recieved 120$. Turned out that one bank charged another 60$ extra fee for playing man in the middle (for what ever out of their ass reason) for my bank and the recipient's bank - they forwarded an electronic money transfer, and kept a THIRD as fee! He was stunned, I was stunned, and my bank was as well.

Solution was to send the rest via a cheque by mail, complicated as that is, but my bank strongly advised me against trying it again...

[The Duchess of Zeon]

That's insane. I've done a direct account transfer from a US credit union overseas in sums vastly larger than that (I won't say exactly how much but we're getting into new car range) and paid $50.00 for the entire transaction. My minimum balance at the credit union is $5.00 and it's open to all Washington State residents (even if you move away you can keep the accounts, so I do even though that means the nearest branch is 3,000 miles away -- I can do everything including cash checks online, instantaneously, needing just a scanner). So you can see that the banking quality in the US is incredibly variable.

As for these cards I think I'd sooner die than use one, and yes, that's a bit of my stereotypical melodramaticism but really? It sounds incredibly like a horrifying 19th century Company Town paying everyone in Company Script. And I thought that was pretty damned illegal now and that people in unions had fought and died to prevent it. Well, maybe we need some more fighting and dying because it seems every bad old thing is slowly creeping back into our society without anything positive for it.

[AMT]

Maybe I wasn't clear. When I say holidays I wasn't referring to public holidays (I guess you guys call them federal holidays), I was referring to annual leave which your employer gives you. If you have say one week leave, then you can set up the bank account then with all the money you saved. Please tell me American employers for the low income workers give their workers annual leave.

Annual Leave for low income employees, if given (which can be very rare) is generally unpaid. If you're low income, you can't afford that.

[The Duchess of Zeon]

I'll also note that in many states this is outright illegal. Oregon for example demands that direct deposit and "debit card" company script options both be optional. Washington State only permits them being mandatory if there are no fees associated with them, etc. If you are in a state where it is illegal to be forced upon you and they're doing it anyway, you have a very strong case, even by the standard of the extreme difficulty someone lower income has in suing a company.

[The Duchess of Zeon]

I'll also observe that federal law explicitly bans requiring direct deposit to a specific financial institution--because it is essentially a warmed over version of forcing everyone to take company script--and that is almost certainly the grounds under which any federal lawsuit would be filed. I'm surprised the woman in the OP didn't file a federal lawsuit under that provision instead of the minimum wage argument, but she may not have been aware of it. On the other hand she kinda sounds like a labour activist trying to get the fight going over those, so I just automatically assumed she should know better. Maybe they'll try both, though.

[Executor32]

Speaking as someone who's had one of these for over 6 years, they're actually nothing like company script, most obviously because you're not limited in where you can spend it. I got mine when I started working at the truck wash back in 2006, and I kept it after I left. I can direct deposit money from, say, an employer or my tax refund for no charge, and if I want to manually load cash from, say, a birthday present or something, I can go to Wal-Mart and have it loaded on the card for a flat fee of $3.74 (that's a recent addition). There's no charge for signature debit, and PIN debit is $.25 per transaction. At Allpoint network ATMs there are no surcharges, and for all other ATMs there is a $1.50 surcharge, in addition to whatever the ATM may charge. The nearest Allpoint ATM is around 20 minutes away from me, so as long as I don't need too much cash, I just get cash back at the store. If I need to pay someone with a check, I can fill out a Transcheck and call their customer service number to activate the check for whatever amount I need for no charge. When I was at the truck wash, making one out to yourself was the suggested way to deposit your full pay in your bank account. You can also transfer money to a bank account for some percentage fee through their website, but I've never done it and I've lost my fee schedule so I have no idea what that percentage is. There's also an account maintenance fee of $2.50 or something, but that fee is waived as long as you have activity in your account for the month, and there's also no 'overdraft protection' and associated fees to worry about. In my use case, wherein I use direct deposit and pay for almost everything via signature debit, I actually rarely have to pay any fees whatsoever.

[fgalkin]

Screwed is put mildly - I once wired money to someone in the US, paying all applying fees at the time on giving the order, adding 40$ on top of a 200$ amount.
Get a call a few days later, they only recieved 120$. Turned out that one bank charged another 60$ extra fee for playing man in the middle (for what ever out of their ass reason) for my bank and the recipient's bank - they forwarded an electronic money transfer, and kept a THIRD as fee! He was stunned, I was stunned, and my bank was as well.

Solution was to send the rest via a cheque by mail, complicated as that is, but my bank strongly advised me against trying it again...

My salary gets paid by domestic wire. My shitty bank (of America) charges me $12 for incoming wires. It's not really a meaningful reduction of my salary (I get paid monthly), but I often put up some $150-$200 for reimbursement, and I was forced to ask my company to lump it in with my salary payment, rather than sending me the money immediately.

Have a very nice day.
-fgalkin