HARRISBURG – The Superior Court of Pennsylvania recently ruled a motion for summary judgment, reached in the Luzerne County Court of Common Pleas in a class action lawsuit involving McDonald’s hourly employees and wage payments, would stand.

On Oct. 21, judges Anne E. Lazarus, Victor P. Stabile and Alice Beck Dubow ruled plaintiffs Alisha Siciliano, Cassie Staretz, Samantha Lynn Early and Justin Eck (individually and on behalf of all others similarly situated) showed Albert and Carol Mueller and McDonald’s violated Pennsylvania’s Wage Payment and Collection Law (WPCL).

The Muellers own and operate 16 McDonald's restaurants in Pennsylvania.  

“Plaintiffs alleged that the Muellers violated the WPCL by paying their wages from November 2010 to July 2013 through a mandatory JP Morgan Chase Payroll Card rather than by cash or check. Plaintiffs sought compensatory and punitive damages as well as counsel fees and litigation costs,” Lazarus said.

“The sole issue on appeal, a question of first impression, is whether mandatory payment of wages by payroll debit card (payroll card) meets the requirement of Section 260.3 of the WPCL that ‘wages shall be paid in lawful money of the United States or check.’ We conclude that it does not, and, therefore, we affirm the trial court’s order,” Lazarus added.

Lazarus quoted the WPCL’s “clear” language as stating wages “shall be paid in lawful money of the United States or check.”

“A debit card is not ‘lawful money” and it is not a ‘check’ as contemplated by the drafters of the WPCL. We agree with the learned trial judge, the Honorable Thomas Burke, Jr., that the Legislature obviously did not contemplate the concept of a payroll debit card when it adopted the language of Section 260.3 in 1961,” Lazarus stated.

Lazarus explained the term “lawful money” was not defined in the statute, but its common definition did not include a debit card.

“The Muellers’ argument that a debit card is the ‘functional equivalent’ of a check or lawful money is unavailing, particularly because the payroll cards, which were mandatory for hourly employees, forced users to incur fees, including over-the-counter cash withdrawal fees and inactivity fees, unless the employees complied with the requirements of the bank/company issuing and managing the debit cards,” Lazarus said. “For example, the fee schedule indicates the cardholder was limited to one free withdrawal per deposit, and thereafter each withdrawal carried a $5.00 fee.”

Citing Section 6121 of the Banking Code in an amicus brief supporting the Muellers, the American Payroll Association (APA) argued “the Legislature has made clear that an employer may satisfy the requirements of the WPCL when ‘lawful money or check is not involved by depositing an employee’s wages into an account at a financial institution.”

“Amicus argues that, ‘By definition, payroll cards involve the deposit of wages into an employee’s account at a financial institution.’ However, what the Muellers fail to address is the fact that the statute clearly requires the written request of the recipient. We emphasize that Plaintiffs here alleged they were required to “receive their employment wages exclusively by a Chase Payroll Card,” Lazarus said.

Lazarus explained the use of a voluntary payroll debit card “may be an appropriate method of wage payment”, but until the state’s General Assembly said otherwise, the “plain language of the WPCL makes clear that the mandatory use of payroll debit cards at issue here, which may subject the user to fees, is not.”

“We conclude that the trial court did not abuse its discretion in denying the Muellers’ motion for summary judgment and, therefore, we affirm the trial court’s order,” Lazarus said.

The defendants are represented by Rachel Fendell Satinsky and Elizabeth Tempio Clement of Littler Mendelson, plus Daniel Thomas Brier of Myers Brier & Kelly, in Scranton.

Superior Court of Pennsylvania case 1321 MDA 2015

Luzerne County Court of Common Pleas case 2013-07010

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com

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