On March 21, Wisconsin Governor Tony Evers signed into law earned wage access (EWA) bill S.B. 579/A.B. 574, a bill supported by PayrollOrg’s Government Relations Task Force. The new law, effective in six months (on September 1, 2024), will enable employers to offer EWA benefits to their employees as a means of promoting financial wellness and retaining talent. The bill requires licensing of EWA providers and establishes a reasonable approach to employer and employee protections.
Important provisions for payroll professionals include the following:
- The definition of “earned but unpaid income” distinguishes EWA benefits from other financial wellness tools and payday lending by stating that EWA is not a loan under Wisconsin law.
- A licensing requirement for EWA providers legitimizes EWA benefits offered to employees in Wisconsin and tells employers which vendors are allowed to operate in Wisconsin.
- EWA providers must create a means of responding to employee questions, provide at least one no cost option to employees, disclose fees and program conditions to employees, and allow employees to opt out of their employers’ EWA benefit later without being subjected to fees and penalties.
PayrollOrg also agreed with bill sponsors that EWA providers should not share with employers “any fees, voluntary tips, gratuities, or other donations that were received from or charged to a consumer” for EWA benefits. The sharing of revenue would create an unwanted incentive for employers and providers, potentially, at the expense of employees and would defeat the purpose of financial wellness opportunities.
Interested in more state and local payroll coverage? PayrollOrg’s PayState Update eNewsletter is perfect for you.
Interested in joining PayrollOrg’s Government Relations Task Force? Please contact us.
Alice P. Jacobsohn, Esq., is Director of Government Relations at PayrollOrg.
