08.27.2010 Amendments to Virginia Wage Payment Act Provide Employers With Greater Flexibility in Paying Wages
Changes to the Virginia Payment of Wage Law, Va. Code Ann. § 40.1-29, now provide additional flexibility for employers who wish to streamline their payroll process. These changes also have caused confusion, as the revised statute is not clear on whether employers are prohibited from mandating the payment of wages via direct deposit. The prior version of the statute specifically precluded employers from forcing employees to accept their wages via direct deposit. Under the revised version, however, this language has been removed. While it seems that the General Assembly attempted to modernize the law to allow additional means of payment, it obscured the direct deposit issue. What is clear is that in Virginia, it is permissible to pay wages via direct deposit into an account in the name of the employee at a financial institution designated by the employee. Also, it is clear that employers may not select the financial institution in which the wages are deposited.

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