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Tuesday, July 02, 2013

They want it all...and they want it now
Posted by Jill | 5:41 AM
First they came for the poor...then they came for the middle class....

It's clear to anyone who is actually conscious and has any grey matter at all in his/her cranium that over the last thirty years there has been a systematic attempt by the corporate/government Axis of Evil to eliminate the middle class that made this country vibrant during the second half of the twentieth century. Wage stagnation, the decline of unions, offshoring in a constant race for the lowest possible wage that can be paid, have all contributed to a shrinking middle class. Far too many people have refused to see this, instead blaming illegal immigrants, minorities, or dirty sluts who won't keep their legs closed and then want an abortion, as the source of the trouble. But in the aftermath of the destruction of well-known brands by vulture capitalists, the housing bubble, and people being required to train their own low-paid replacements before being fired, it's becoming more difficult to ignore the elephant in the room.

On this day following the doubling of student loan rates, which has made the U.S. government and the banks with which it works to establish student loan programs nothing more than loan sharks, we're now seeing the corporate masters raiding the pockets of those college grads for whom retail and food service jobs are the only employment they can find. Now it seems that for hourly workers, a paycheck and even direct deposit is too costly for the companies they work for. Instead they're getting fee-based debit cards that involve high fees to -- you guessed it -- banks. NYT, yesterday:

A growing number of American workers are confronting a frustrating predicament on payday: to get their wages, they must first pay a fee.

For these largely hourly workers, paper paychecks and even direct deposit have been replaced by prepaid cards issued by their employers. Employees can use these cards, which work like debit cards, at an A.T.M. to withdraw their pay.

But in the overwhelming majority of cases, using the card involves a fee. And those fees can quickly add up: one provider, for example, charges $1.75 to make a withdrawal from most A.T.M.’s, $2.95 for a paper statement and $6 to replace a card. Some users even have to pay $7 inactivity fees for not using their cards.

These fees can take such a big bite out of paychecks that some employees end up making less than the minimum wage once the charges are taken into account, according to interviews with consumer lawyers, employees, and state and federal regulators.

Devonte Yates, 21, who earns $7.25 an hour working a drive-through station at a McDonald’s in Milwaukee, says he spends $40 to $50 a month on fees associated with his JPMorgan Chase payroll card. v “It’s pretty bad,” he said. “There’s a fee for literally everything you do.”

Certain transactions with the Chase pay card are free, according to a fee schedule.

Many employees say they have no choice but to use the cards: some companies no longer offer common payroll options like ordinary checks or direct deposit.

At companies where there is a choice, it is often more in theory than in practice, according to interviews with employees, state regulators and consumer advocates. Employees say they are often automatically enrolled in the payroll card programs and confronted with a pile of paperwork if they want to opt out.

It's one thing to require to make employees contribute to the cost of health care, life insurance, and dental coverage. These are at least deductions that benefit the employee. But to work in tandem with megabanks to squeeze a few dollars out of low-paid workers is just beyond the pale.

How long will it take until people wake up and realize what is happening to them and stop blaming those with even less? Will it take until there IS no one with less because EVERYONE is left scrambling for scraps?

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4 Comments:
Anonymous draftmama said...
Employees can opt out and require either a paper check or direct deposit, but they are not told that so they assume the only way to get paid is with these awful cards.

Folks need to educate themselves.

Blogger Jill said...
Not at every company; some are ONLY offering these cards. It's all well and good to say that "folks need to educate themselves", but how many people really understand how these things work? When you are educated and intelligent, you get how to read the fine print, but for many low-wage workers, they can't navigate these things. Sounds like you're saying that if these people can't do this, they deserve what they get. Please clarify if I'm wrong.

Blogger The New York Crank said...

Charges a millionaire ten cents to get his own money and listen for the howl heard round the world.So the only choice the hapless banks have is to sock the poor.

Serves the poor right for not being rich.

Very crankily yours,
The New York Crank

Anonymous CC said...
How much does it cost to implement direct deposit? That was supposed to be cheaper than issuing paper checks.