B2B Payments

Judge Thwarts Latest Attempt To Derail McDonald’s Payroll Card Suit

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A lawsuit against McDonald’s and a payroll card-issuing bank over the fees associated with the cards will move forward despite objections, reports said over the weekend.

Despite attempts by JPMorgan Chase and other defendants to argue that it was not deceptive in its promotion of payroll cards to fast-food workers, Judge Thomas Burke Jr. overruled preliminary objections to allow the suit to move forward, reports said on Sunday (July 3).

Plaintiffs that filed the case claim JPMorgan Chase was deceptive in its claims that a payroll card “saves you money,” arguing that the statement implies fees will not be incurred.

But a lawyer for JPMorgan, which issued the cards, said the bank provided information to help cardholders avoid fees.

The objections were filed by defendants JPMorgan Chase & Co, JPMorgan Chase Bank N.A., Albert and Carol Mueller Limited Partnership and Albert and Carol Mueller.

Judge Burke had also previously declined to dismiss the case or provide summary judgment in the suit.

The case was filed last year by McDonald’s employees against the Muellers and other McDonald’s location owners on claims that the cards unfairly force workers to pay fees to access their wages. The case earned class-action status in May 2015.

Last October, research published by the American Payroll Association found that employers are increasing their efforts to educate employees on the fees associated with payment methods like payroll cards; the “Getting Paid in America” report revealed that 75 percent of employers explain these fees to their workers.

Proponents of payroll cards say they connect underbanked workers to the financial system to which they might otherwise not have access.

“Employees who chose a payroll card do so for a safer, more convenient and less expensive option than a paper paycheck,” said Visa Senior Director of Global Prepaid Products Jill Goebel in an announcement highlighting the American Payroll Association’s report when it was published. “This year’s results show employers and card providers are helping their employees understand the best ways to use their cards.”

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