Direct deposit of paycheck question

[kerry]

Had to complete some 'new hire' paperwork since I'm teaching a couple of classes for my former employer. Included was a Direct Deposit Authorization for my paycheck. I was very surprised to read that it authorized my employer to both make deposits into my account and to withdraw from my account if necessary (as a result of a mistake). I am wondering if other people are signing such forms? A quick search of the internet revealed many forms which simply authorize deposits but a few forms which authorize both deposits and withdrawals, including the boilerplate form in Microsoft Office. It seems very unwise to me to sign such a form since it basically is giving your employer a blank check to access your account. Thoughts?

[t walgamuth]

I'd refuse unless it meant I would not get the job. If that is the case you can always open an account just for that purpose.

[dynalow]

Originally Posted by kerry

Had to complete some 'new hire' paperwork since I'm teaching a couple of classes for my former employer. Included was a Direct Deposit Authorization for my paycheck. I was very surprised to read that it authorized my employer to both make deposits into my account and to withdraw from my account if necessary (as a result of a mistake). I am wondering if other people are signing such forms? A quick search of the internet revealed many forms which simply authorize deposits but a few forms which authorize both deposits and withdrawals, including the boilerplate form in Microsoft Office. It seems very unwise to me to sign such a form since it basically is giving your employer a blank check to access your account. Thoughts?

Is the "employer" also the payroll processor/transferor or are they using a private company i.e. ADP, Paychex.

I have 3rd party DDs, but I couldn't tell ya what the form I signed contained. Net pay is a one way street imo. Payroll company screws it up and the employer account it is transferring the funds from should be the one hit for error corrections.

Blame the lawyers who wrote up the damn thing....then sign.

[kerry]

It's hard to figure out the law in these matters. Unless the federal law has changed since 1997, an employer who makes a mistaken deposit into a employees account, has 5 days to reverse the deposit. This can be done without the employees consent. But that is from a 1997 NYT article. Perhaps the law is different now and hence my employers change in wording. However there are different state laws on direct deposit. Employers cannot require direct deposit in CO according to what I read.

I'm gun shy on this issue partly because some years ago my wife's employer told her that they had been underpaying her for a long time and gave her a check for $xxxxx. Then many months later, after income taxes had been filed on the $xxxxx, decided that their discovery of the mistake was actually a mistake and that my wife needed to repay the long spent $xxxxx. A lawyer got involved and it wasn't repaid.

I crossed out and initialed the offending portions of the form and submitted it.

[t walgamuth]

Its worth a try.

[kerry]

I'm counting on a lack of attention to detail.

[dynalow]

Originally Posted by kerry

I'm counting on a lack of attention to detail.

Wut? In today's world?

[Can't Know]

If it was more than one page, I'd bet in your favor.

[kerry]

If it comes to it, I'll rely on the following Colorado statute:

Direct Deposit

Direct deposits can only be made if the employee has voluntarily authorized the deposit and has chosen the financial institution into which the deposit is made.

[spdrun]

Cross out and initial. If the company really needs you, the HR dweebs will be told to keep their mouths shut and not make a fuss about it. Especially since mandating direct deposit is apparently illegal in Colorado:

Colorado - Wage Payment Laws | Employment Law HandbookEmployment Law Handbook

Get your payments via checks. Not like killing a tree or two really matters.

[Simpler=Better]

Originally Posted by spdrun

Cross out and initial. If the company really needs you, the HR dweebs will be told to keep their mouths shut and not make a fuss about it. Especially since mandating direct deposit is apparently illegal in Colorado:

Colorado - Wage Payment Laws | Employment Law HandbookEmployment Law Handbook

Get your payments via checks. Not like killing a tree or two really matters.

Paper trees are a crop these days. You get better pulp cheaper when you grow the tree form a sapling in a "controlled" forest. I wouldn't worry about the tree part

[compress ignite]

Set up the "Separate" account at ANOTHER financial institution!

If you do it "In House" @ the same institution,They'll ("The Bank")
[Most especially Commercial Banks] just rob one of your accounts to
"Refund" the other AND clip you for Underfunded Transactions to boot!

Worst news is that All EFTs are Dual Carriageway (IN AND OUT).
If they've got permission to put in,they can take out without notice.

[kerry]

Originally Posted by compress ignite

Set up the "Separate" account at ANOTHER financial institution!

If you do it "In House" @ the same institution,They'll ("The Bank")
[Most especially Commercial Banks] just rob one of your accounts to
"Refund" the other AND clip you for Underfunded Transactions to boot!

Worst news is that All EFTs are Dual Carriageway (IN AND OUT).
If they've got permission to put in,they can take out without notice.

Unless the law has recently changed that's not exactly true. If you sign a paycheck deposit agreement only (not a withdrawal agreement), the depositor has 5 days from the date of the deposit to withdraw it or change it. The account holder can dispute this withdrawal in a limited time period and the bank must investigate within a specified period of time. A deposit/withdrawal agreement circumvents this federal law.

[tbomachines]

Originally Posted by compress ignite

Set up the "Separate" account at ANOTHER financial institution!

If you do it "In House" @ the same institution,They'll ("The Bank")
[Most especially Commercial Banks] just rob one of your accounts to
"Refund" the other AND clip you for Underfunded Transactions to boot!

Worst news is that All EFTs are Dual Carriageway (IN AND OUT).
If they've got permission to put in,they can take out without notice.

Holy cow I can't even read this. Anyways Kerry I think that is pretty standard. If there is a withdrawal you crossed it off and signed it so at least that is a crutch


Sent from an abacus

[BayouFlyFisher]

As said earlier, setup an account that you use for nothing but that deposit. Once deposit has been made transfer funds out to an account you use for day-to-day things.