Former Employee Sues McDonald’s After Being Paid Only in Prepaid Debit Cards

mcdonaldsThe interchange fee debate took an interesting turn after a former McDonald’s employee in Pennsylvania sued the hamburger chain for refusing to pay her in anything but a debit card.

A detailed report by the Citizen’s Voice newspaper revealed that the Shavertown McDonald’s forces workers to be paid only one way: with a payroll debit card that burdens workers with hefty fees to obtain their hard-earned cash, according to a lawsuit filed Thursday on behalf of Natalie Gunshannon and other McDonald’s workers.

Gunshannon and an untold number of current and former employees had no option to receive a traditional paycheck or get paid by direct deposit, she and her attorneys said in the class-action against franchise owners Albert and Carol Mueller of Clarks Summit, the report said.

Furthermore, the J.P. Morgan Chase payroll card carries fees for nearly every type of transaction, according to the lawsuit, including a $1.50 charge for ATM withdrawals, $5 for over-the-counter cash withdrawals, $1 to check the balance, 75 cents per online bill payment and $10 per month if the card is left inactive for more than three months.

Plus, J.P. Morgan Chase then collects debit card fees from the retailers that accept the debit card as cash from the employees when they buy gas, lunch or pretty much anything else creating the ultimate win-win scenario.

Gunshannon, who worked at the Shavertown McDonald’s for a month after being hired April 24, refused to activate the payroll card after reviewing the fee structure, quit the job and reached out to an attorney to see if the practice was legal.

Attorney Michael J. Cefalo of West Pittston and his law firm then drafted a class-action lawsuit against the Muellers, who own 15 other McDonald’s locations throughout Northeastern Pennsylvania.

The use of payroll cards as a method of wage payment exploded over the last decade, after credit card giants Visa and MasterCard said in 2001 they would invest heavily in paperless pay systems, the report said. Electronic pay systems eliminate the need for printing paper checks and the processing fees associated with traditional payroll methods, cutting wage-related costs by as much as 50%, according to Automatic Data Processing Inc., the payroll processing firm.

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