Non-DD EE's Paycheck lost in the mail

debs6882 · May 2004

We have voluntary Direct Deposit. Checks are mailed to EE's who do not participate. As of 5/18/04 EE still had not received check for 5/7/04. We cut a replacement check on 5/10/04. We are thinking of starting a new policy that states if you want a replacement check you have to pay the stop payment fee on the lost check. We feel we have fulfilled our duties by presenting the checks to the US postal service. If it gets lost in the mail, that is between the EE and the postal service.

Any advice or past expericences?

Thanks in advance!

amwkim · May 2004

I understand that once the check leaves your hands, you are no longer responsible. However, the employee is not at fault for a "lost" check and in my opinion, should not be penalized.

Balloonman · May 2004

We have voluntary DD also. Same thing, if they do not want to wait for the check to be found, we will cut them another one, but they must pay the stop payment fee. It is "their fault" for not signing up for direct deposit. I do find that most will sign up for DD after one check is lost though.
My $0.02 worth!
DJ The Balloonman

marc · May 2004

We have struggled with this issue for a while. Some of our EEs are in remote locations with uncertain postal service and delivery has been a huge issue with one particular EE. Until she finally switched to Direct Deposit, a check was being lost or delayed about once a quarter.

Of course it always became a huge emergency. She did not like direct deposit because the casinos in Nevada are famous for offering a free spin on a wheel or a slot that gives spinners a chance at millions.

The stop payment charges range from $12 for an on-line stop to $30 for a phone call stop. We also have voluntary direct deposit.

I just drafted a policy that will charge for the stop payment fee and will not replace the check until one business day after the request for a stop payment. It does penalize the EE, but they can avoid the penalty by using the direct deposit.

I am presenting this to our Exec Dir today so wish me luck.

debs6882 · May 2004

Good Luck! I agree, the stop payment charge can be looked at as more of an incentive to participate in DD than a penalty.

Rockie · May 2004

Good luck. Direct deposit is the only safe bet on not having lost checks. One of the reasons we went to mandatory direct deposit was we had an employee who stated she had not received her check in the mail and, of course, it was an emergency. (the baby needed milk or something like this!). Anyway....we cut another check immediately and guess what? She cashed both of them. She was savvy enough to be one step ahead of us and the bank.

Of course, there were many excuses as to "why" this happened, but the bottom line was...she was a thief. (and an ex-employee).

Brad Forrister · May 2004

"She did not like direct deposit because the casinos in Nevada are famous for offering a free spin on a wheel or a slot that gives spinners a chance at millions."

Huh?

So she liked putting it in the U.S. Postal Service roulette wheel, just to see if it would make it to her mailbox?

Brad Forrister
Director of Publishing
M. Lee Smith Publishers

Don D · May 2004

As long as DD is an optional offering, I don't feel that the ee should be penalized for choosing the option he feels most appropriate for him. Coercing people to make a particular choice that you told them was totally optional is a bit disingenuous. I also think it's a bit cheap-assed to tell the ee he has to fork up cash to stop payment on a check that he has no control over. What do you charge for ice water? Just my humble opinion.

FHR · May 2004

Marc, please clarify the connection between the roulette wheel and DD. As Brad mentioned there is more similarity with the US postal service.

marc · May 2004

Local casinos allow any EE a free spin on a wheel or a free pull on a slot machine if they cash their paycheck at the casino. The free spin is for varying amounts of cash up to $1,000,000. DD eliminates the opportunity to cash the check.

Good point Brad re the US Postal Service. Of course, the Casino's pay when you beat their odds, the Postal Service sends you to the lost letter department never to be heard from again.x;-)

LindaS · May 2004

Don, in response to your post regarding penalizing the employee, how about the penalizing of the employer? Banks, at least in this area, charge between $15-$25 to stop payment on a check, not to mention the cost of having to have someone re-run the check. The employee is given an option of having their check put directly into an account of their choice, thereby removing the risk of having it lost, washed, burned, etc. If the employee chooses NOT to do this, it should be their responsibility to pay the stop payment fee on the check. Let me give you a recent example...

I had an employee go out on layoff and call me to tell me that he did not receive his paycheck in the mail. Our policy is to wait 5 days until we stop payment and then he is responsible for the fee. Anyway, he was extremely angry UNTIL he went out to his truck (on the 5th day mind you) only to find a flyer on the passenger's seat and inside the flyer, low and behold, was his paycheck (the flyer had been in his truck since Monday).

Now, if we had stopped payment on the first check and re-run the check and didn't charge him, we would have been out the money for nothing.

As far as direct deposit, if an employee doesn't get their receipt, getting them the requisite information regarding gross pay, deductions, etc. is MUCH simpler than having to void a check and re-run one.

Hatchetman · May 2004

[font size="1" color="#FF0000"]LAST EDITED ON 05-20-04 AT 11:16PM (CST)[/font][br][br]Anything in West Virginia employment law that requires the employer to place the check in the employee's hands or in direct deposit rather and not mail it (assuming the employee is at work)? Why can't you just hand out the paychecks for those who don't have direct deposit?

In fact, what do you do with the paystubs for those employees on direct depost? Do you mail those too?

rad · May 2004

We pass out checks and stubs. It takes a papal dispensation and an act of congress to have a check or stub mailed to an employee's home.

debs6882 · May 2004

WV law says that you can have mandatory DD, but if the employee does not have a bank account the employer has to provide them with one for the pay to be deposited in. That is not something that we want to get involved in, so our DD is voluntary. The DD stubs along with the checks are taken to the PO the day before payday. Which should get them to the EEs on payday. We used to Overnight a package of checks to each of our offices the day before payday. So we are saving some money this way. We do not pass out the checks because we have offices in 3 states and the PR is here in WV.

SW · May 2004

We also have optional direct deposit and adopted the policy of charging the employee for the stop payment fee a few years ago. It is amazing to me how many employees want to wait another few days for the check to show up once they find out about the charge. We have reduced the number of replacement checks by 75% since implementing this practice. We allow them to pick up their checks on payday and only mail out the ones who do not come in to get them. I don't feel it is penalizing the employee because they have several options to having it mailed. The usual reason for the "lost" check is that they forgot to give us their new address.

Non-DD EE's Paycheck lost in the mail

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