July 11, 1996
COMPTROLLERS MEMORANDUM NO. 01 (1996-97)
SUBJECT: MANDATORY DIRECT DEPOSIT-NEW EMPLOYEES
Chapter 96-310, Laws of
Florida, amended Section 110.113, Florida Statutes, effective
July 1, 1996, to require mandatory participation in the direct
deposit program by new employees.
The use of direct deposit
is now a condition of employment for a person appointed to a position
in State government on or after July 1, 1996. It is therefore
the agencys responsibility to insure new employees understand
the requirement for compliance before they are offered employment.
This new law does not apply to persons employed by the State before
July 1, 1996 unless they subsequently change to a different personnel
system.
OPS employees are encouraged
to use direct deposit, but are categorically exempt if they desire.
Employees who can demonstrate
a hardship or can demonstrate that he or she is unable to establish
an account at a financial institution may request an exemption.
Employees desiring an exemption based on a hardship should prepare
a letter, addressed to the Comptroller, explaining the hardship
and requesting the exemption. The letter must be endorsed by the
agency personnel Chief as delegated by the agency head. If approved
by the agency personnel Chief, the letter should be sent to the
address indicated on the attached sample letter. If the request
is approved by the Comptrollers Office, notice will be given and
the employee will be paid by State warrant. If the request is
denied, notice of such denial will be provided to the agency within
20 calendar days of the agency submission date. Employees transferring
from another agency, changing from another personnel system or
re-employed retirees do not need to complete a new Direct Deposit
Form if they are currently participating.
Employees covered by this law shall authorize direct deposit on a Direct Deposit Authorization
Form and submit it to our office, at the address indicated on
the form, within thirty calendar days after employment
with the State. We recommend the employee attach a voided check
to the form to assist in processing the transit routing and account
numbers.
A savings or checking account at a financial institution is all that is required for direct
deposit. Commercial banks, savings and loans and credit unions
are all considered financial institutions. Most, if not all, State
employees have one or more credit unions they may join. Additionally,
most commercial banks offer free or reduced cost accounts with
the use of direct deposit to State employees.
New employees should be
encouraged to check with various financial institutions during
the selection process.
An employee who is changing
his or her authorization and receives a warrant while the new
authorization is in process is not considered to be in non-compliance
with the statute.
Attached is a summary indicating
changes from the draft Comptrollers Memorandum to the final Comptrollers
Memorandum, questions received during the exposure of the draft
Comptrollers Memorandum and our responses to those questions,
and a sample format to use for a letter requesting a hardship
exemption.
If you have any questions,
please call Mike Crowley at 488-2922 or Suncom 278-2922.
SUMMARY OF CHANGES FROM THE DRAFT COMPTROLLERS MEMORANDUM
- DRAFT MEMO: Required
all employees to complete a Direct Deposit Compliance Form.
FINAL MEMO: No Direct Deposit
Compliance Form is required.
- DRAFT MEMO: Completed
Direct Deposit Authorization Form was required to be sent to the
agency personnel office by the employee within 30 days.
FINAL MEMO: Completed Direct Deposit Authorization Form is required to
be sent to the Comptrollers office by the employee within 30 days.
- DRAFT MEMO: Direct Deposit
Compliance Form required to be used to request exemption.
FINAL MEMO: Exemption is
to be requested by employee in the form of a letter.
- DRAFT MEMO: Justification of exemption required approval by Agency Head
or Assistant Agency Head.
FINAL MEMO: Justification of hardship is required to be approved/endorsed
by agency personnel Chief and then submitted to Comptrollers Office.
QUESTIONS AND ANSWERS REGARDING
MANDATORY DIRECT DEPOSIT
- QUESTION: The Direct
Deposit Authorization form allows changes. If the Stop action
is received by the State Comptrollers Office, will it be honored
even though you cannot feasibly manage this request without access
to the employment date?
ANSWER: Yes. If a participant
is changing bank accounts, it is necessary to stop the old account
in order to begin a new account. During that time period, the
employee will receive a State warrant.
- QUESTION: Since the
new law is a condition of employment, does this mean that not
complying is a condition for termination?
ANSWER: The employer should
explain, at the time of making the offer to the prospective employee,
that participation in direct deposit is a condition of employment
and that the employee is expected to comply with the Law.
- QUESTION: The impact
will be negative on our lower paid people. What about the employees
that do not have/want an account?
ANSWER: Unless the employees
qualify for a exemption otherwise, they will be required to open
an account.
- QUESTION: What about the employee who will have to establish
another account because the employee does not want the spouse
to have access to the money?
ANSWER: A new account will
have to be opened.
- QUESTION: What is the
criteria for approving hardships?
ANSWER: It is impossible to define every situation. Be assured we (Comptroller)
will be sensitive to individual needs and respectful of Agency
recommendations.
- QUESTION: Does an annual
salary of $20,000 or below automatically constitute a hardship
if requested?
ANSWER: No. Additional justification is required.
- QUESTION: Does an annual
salary of $20,001 or above automatically preclude approval of
a personal hardship?
ANSWER: No. Approval will depend upon the justification provided.
- QUESTION: Will approved
exemptions remain in effect until the employee leaves State government
or will renewals be required on a periodic basis?
ANSWER: The approved exemption will remain in effect. However, we would
encourage participation if circumstances change which would allow
for participation.
- QUESTION: Why make direct
deposit mandatory?
ANSWER: It is a good business practice. The Federal Government is above
90% direct deposit and has been mandatory for years. This is the
mere adoption of a best business practice.
SAMPLE LETTER
The Honorable Robert F.
Milligan
Comptroller
Room 1301, The Capitol
Tallahassee, Florida 32399-0350
Dear Comptroller Milligan:
I hereby request an exemption
from the requirement of mandatory participation in direct deposit
for the following reason:
State Reason for
request
Thank you for your consideration
of this request.
Sincerely,
Name of Individual
This request is recommended
by:
________________________________
Signature
________________________________
Title
