In all contracts entered into with workers or employees, their wages shall be paid in the legal tender of the United States of America, whether in cash or check. The employer, however, may choose to pay, subject to the provisions below, the wages of his/her workers or employees through one or more of the following electronic means of payment:
(1) Direct deposit;
(2) electronic transfer, or
(3) payroll credit cards, subject to the provisions under § 176 of this title.
Payment through electronic means shall be effective on the same payday. The worker or employee shall have the option to choose from among the methods that the employer makes available, whether cash, check, or electronic means of payment, subject to the provisions under § 176 of this title, that he/she wishes for the payment of his/her wages, on a voluntary basis.
If by special agreement, custom, or other reason whatsoever, the employee or worker receives a cash advance through check or electronic means of payment before the regular payday, subject to the provisions under § 176 of this title, it shall be lawful for the employer to deduct said advance from the next payment.
If it is stipulated in a labor contract that all or part of the wages shall be paid in a form other than money, check, or electronic means of payment, subject to the provisions under § 176 of this title, said contract shall be null insofar as it refers to the promise or commitment to pay the wages in any form other than the methods of payment allowed under §§ 171—177 of this title.
Payments made through direct deposit or electronic transfer shall be made into the account of the worker or employee at the bank of his/her own selection. The employer shall deliver a voucher to each worker or employee as evidence of the salary electronically deposited or transferred, after the deductions authorized by law, whether into his/her bank account or a payroll card. This voucher may be distributed in printed format (on paper) or electronically (by telephone, facsimile or through a Web site), as the employee or worker chooses, with no additional charge to the employee by the employer or the banking institution. The costs related to the salary payment system through check or electronic means of payment, subject to the provisions under § 176 of this title, shall be the exclusive responsibility of the employer.
At the time of asking the employee or worker about his/her decision to avail himself/herself of a cash, check or electronic means of payment, subject to the provisions under § 176 of this title, the employer shall make available to the employee information regarding electronic fraud. The employer shall likewise indicate to his/her employee the degree of responsibility of the employee, the employer and the bank used by the employer for his/her electronic payroll payments in the case of electronic fraud.
When an employer pays the salaries of his employees through checks and the same cannot be cashed because the employer-drawer lacks the necessary funds in the bank against which they were drawn, or because he/she has closed the bank account, the employees thus affected may file a complaint before the Secretary of Labor and Human Resources, for the latter to require the employer to post a bond, approved by the Insurance Commissioner, to guarantee the payment of the employees’ salaries. These remedial measures shall be imposed after a hearing, which shall be held no later than ten (10) days from the date of the payment of the salary and all the circumstances of the case shall be taken into consideration. The maximum duration of such an order shall be two (2) years. The requirement of a bond or any other protective measure to be decreed by the Secretary of Labor and Human Resources shall be without diminishing the penalties and remedies provided in § 177 of this title. The Secretary of Labor and Human Resources shall immediately promulgate the necessary regulations for these procedures.
History —Apr. 17, 1931, No. 17, p. 194, § 1; July 1, 1995, No. 74, § 1; Dec. 26, 2007, No. 213, § 1.