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Division Director

Christina Smith

Assistant Directors

Rick Sweet

Rachael Lieblick


Accounting and Auditing
200 East Gaines Street
Tallahassee, FL 32399-0318

(850) 413-5510
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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

  1. DRAFT MEMO: Required all employees to complete a Direct Deposit Compliance Form.

    FINAL MEMO: No Direct Deposit Compliance Form is required.

  2. 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.

  3. 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.

  4. 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


  1. 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.

  2. 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.

  3. 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.

  4. 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.

  5. 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.

  6. QUESTION: Does an annual salary of $20,000 or below automatically constitute a hardship if requested?

    ANSWER: No. Additional justification is required.

  7. 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.

  8. 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.

  9. 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