US employers using more alternative payroll methods
17 July 2014
Reports from the United States indicate a significant rise in the use of alternative payment methods such as prepaid debit cards and Bitcoin. It remains to be seen whether a similar trend is noticed in the United Kingdom, where different legal constraints will apply.
According to the National Law Review, the rise of alternative payroll methods such as prepaid debit cards and Bitcoin is likely to present both opportunities and challenges for United States employers in the very near future.
“In 2013, nearly 4.5 million United States employees received wages on a payroll card, and some major retailers began accepting Bitcoin as a method of payment. Some employees express a preference for alternative payroll methods.
Thefederal government has taken the positionthat employers cannot force employees to receive wages via a prepaid debit card. Additionally, an employee who chooses this method is entitled to specific protections including access to fee and account information.”
In the United Kingdom, the legislation governing allowable methods of remuneration is different from the USA, and the tax and national insurance treatment is also likely to diverge.