Direct Deposit and Payroll Card Requirements in Pennsylvania

At a glance

Requirements one by one

Electronic wage payment requires employee authorization

Pennsylvania's Wage Payment and Collection Law, 43 P.S. § 260.3(a), starts with lawful U.S. money or check. Act 173 of 1975 then permits payment by credit to a financial-institution account, including a payroll card, when the recipient authorizes the method in writing or electronically under 7 P.S. § 6121.1.

The employer definition in 43 P.S. § 260.2.1 broadly covers persons and business entities employing anyone in Pennsylvania. Act 173 states no separate payroll- card employer-size threshold.

The current electronic-transfer provision does not separately say that the employee selects the direct-deposit institution. A payroll-card account must be at a financial institution whose funds are insured by the FDIC or NCUA. The card cannot be a condition of employment or a condition for receiving a benefit or another form of remuneration.

Payroll-card notice comes before authorization

Before obtaining authorization, § 6122.1(4) requires a clear and conspicuous written or electronic notice. It must identify every wage-payment option, the card terms and conditions, issuer fees that may be deducted, the possibility of additional third-party fees, and the methods for accessing wages without fees.

Section 7 P.S. § 6122 also requires the financial institution to provide the disclosures, transfer notices, change-in-terms notices, account-information access, and other protections required by Regulation E. The employer must give the employee a written or electronic earnings-and-deductions statement each pay period as applicable law requires.

The card must provide free access and limit fees

Under § 6122.1(5)-(7), the employee receives two fee-free transactions each pay period: one withdrawal for any amount up to the full net wages for that period, and one in-network ATM withdrawal. If the employee is paid more frequently than weekly, each right becomes weekly. The account must also provide free balance access through an automated telephone system or other electronic means.

The employer cannot use a card that charges the employee for joining the program, the initial card, one requested replacement card per calendar year, loading wages or other compensation, point-of-sale purchases, or inactivity lasting less than 12 months. Funds do not expire. If a card expires while wages are being loaded or within 60 days after the last wage transfer, the statute generally requires a free replacement before expiration.

An employee can move off the payroll card

Under § 6122.1(9), the employer must honor a written or electronic request to change from a payroll card to direct deposit or negotiable check. The change is due as soon as practicable and no later than the first payday after 14 days from the employer's receipt of both the request and the information needed to make the change.

Final wages use the ordinary separation deadline

The method statutes do not create a different deadline for the last paycheck. Under 43 P.S. § 260.5(a), final wages are due no later than the next regular payday on which they otherwise would have been payable. The employer must send the payment by certified mail if the employee requests it.

Section 43 P.S. § 260.9a(f) requires reasonable attorney's fees in an action under that section in addition to the judgment. That is an unpaid-wage remedy; Act 173 does not state a separate damages amount for a notice-only or fee-disclosure- only payroll-card violation.

What trips people up

The free full-wage withdrawal and free ATM withdrawal are separate. The statute grants one of each per pay period, or weekly for an employee paid more often than weekly. A single free ATM transaction does not necessarily satisfy the separate right to withdraw up to the full net wage amount.

Authorization does not erase the notice sequence. For a payroll card, the employer must give the listed clear and conspicuous disclosures before obtaining the employee's authorization.

A switch request needs implementation information. The 14-day timing rule runs from receipt of both the written or electronic request and any information necessary to implement the change.

Common questions

Can a Pennsylvania employer make a payroll card mandatory?

No. Section 7 P.S. § 6122.1(3) says payroll-card payment cannot be a condition of employment or a condition for receiving a benefit or other remuneration.

Can the card charge an inactivity fee?

Not when the defined nonuse or inactivity lasts less than 12 months. The state statute does not prohibit every fee that might arise after that threshold, so the disclosed card terms still matter.

Do payroll-card funds expire when the plastic card expires?

No. Section 7 P.S. § 6122.1(8) says the funds do not expire and generally requires a free replacement card before an expiration date that falls while wages are being loaded or within 60 days after the last wage transfer.

Statutes and sources

• 43 P.S. §§ 260.2.1, 260.3(a), 260.5(a), and 260.9a(f). Coverage, lawful-money/check baseline, final-pay timing, certified-mail request, and attorney's fees in an action under the Wage Payment and Collection Law. Official current act (accessed July 14, 2026).
• 7 P.S. §§ 6121.1, 6122, and 6122.1. Authorization for electronic wage payment, consumer protections, card notice, fee-free access, prohibited fees, nonexpiring funds, and the method-change deadline. Official current Act 173 (accessed July 14, 2026).
• PA SB 581 (2025-2026). Pending proposal to permit elimination of cash and check after advance notice and to assign a payroll card when an employee makes no timely account designation. Official bill page (checked August 26, 2026).