Direct deposit is a convenient and secure method of receiving your paycheck. It saves you time and eliminates the need for physical checks. But can employers make direct deposit mandatory for their employees?

The answer is yes, in most cases. According to federal law, employers are allowed to require direct deposit as long as they provide their employees with at least one other option for receiving their pay. This option can be a traditional paper check or an electronic payment system, such as a prepaid debit card.

Direct Deposit Requirements by State

Can Employers Require Direct Deposit

Employers can require their employees to receive payments through direct deposit, but state laws may regulate the practice. Employers must comply with restrictions, including:

  • No requirement for specific bank usage.
  • Prohibition of fees for payment method.
  • Access to pay stubs for employees.
  • Availability of pay cards for employees without bank accounts.

State laws may also require employers to provide employees with pay stubs, either in print or electronic form. The Fair Labor Standards Act mandates accurate record-keeping of employees' wages and hours worked, but pay stubs are only mandatory in certain states.

States that require printed pay stubs include Arizona, Colorado, Connecticut, Hawaii, Iowa, Maine, Minnesota, New Mexico, North Carolina, Texas, and Vermont. Electronic pay stubs are acceptable in these states as long as employees can access them electronically, have a secure login, and have the ability to print them.

On the other hand, Arkansas, Florida, Louisiana, Mississippi, Nebraska, South Dakota, Tennessee, and Virginia do not require pay stubs. The remaining states have some pay stub requirements, either in print or electronic form, such as via an Employee Mobile app.


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Mandatory Direct Deposit By State

State  Can You Make It Mandatory  Covered employers 
Alabama  Private Sector: Yes

Public Sector: No

All employers 
Alaska  No All employers 
Arizona  Yes  All employers 
Arkansas  No  Private and state-government employers 
California  No  All employers 
Colorado  No  Private employers 
Connecticut  No  All employers 
Delaware  No  Private employers 
District of Columbia  No  Private Employers and Local Governments 
Florida  No  All employers 
Georgia  No  All employers, excluding those in the agriculture, lumber, and resin industries
Hawaii  No  All employers 
Idaho  No  All employers 
Illinois  No  All private employers and local entities, excluding state and federal governments.
Indiana  Yes  All employers 
Iowa  Yes: Employers are prohibited from mandating direct deposit for employees hired before July 1, 2005. However, for new employees, enrolling in direct deposit may be a requirement of their employment, except if the fees associated with setting up and maintaining the account would result in the employee's wages falling below the minimum wage level.  All employers 
Kansas  No  All employers 
Kentucky  Yes  All employers 
Louisiana  Yes  Public sector, State government 
Maine  Yes  All employers 
Maryland  No  All employers under various statutes  
Massachusetts  Yes  All employers 
Michigan  Yes  All employers 
Minnesota  Private sector: No

Public sector: The Commissioner of Labor and Industry has the authority to mandate direct deposit for all state employees

All employers under various statutes  
Mississippi  No regulations regarding direct deposit   All employers 
Missouri  No regulations regarding direct deposit   All employers 
Montana  No  All employers 
Nebraska  No regulations regarding direct deposit  All employers 
Nevada  No  All employers 
New Hampshire  No  All employers 
New Jersey  No  All employers 
New Mexico  No  All employers, excluding those employing domestic workers in private residences and those in the livestock and agriculture industries.
New York  No  All employers 
North Carolina  Yes  All employers 
North Dakota  Yes  All employers 
Ohio  No regulations regarding direct deposit   All employers 
Oklahoma  Private sector: Yes

State government: Yes

All employers, under different circumstances  
Oregon  No  All employers 
Pennsylvania  No regulations regarding mandatory direct deposit   All employers 
Rhode Island  No  All employers 
South Carolina  No  All employers 
South Dakota  Yes  All employers 
Tennessee  Yes  Private employers with at least five employees  
Texas  Yes  All employers 
Utah  Yes  Private employers, excluding those engaged in agriculture, dairy farming, horticulture, grape growing, or livestock and poultry breeding, as well as those providing domestic household services or employment where a written agreement offers alternate terms.
Vermont  No  All employers 
Virginia  No  All employers 
Washington  Yes  All employers 
West Virginia  State institutions of higher education: Yes

Employers under the jurisdiction of the WPCA: No

Wisconsin  Yes  All employers 
Wyoming  No  All employers 


At Workforce PayHub, we can help guide businesses through the direct deposit regulations and requirements by providing expert advice and support. We ensure compliance with state laws and regulations regarding direct deposit, helping businesses avoid potential legal penalties or fines.

Workforce PayHub can also help simplify the payroll process, making it easier for businesses to manage direct deposit payments and pay stubs for their employees. Contact us today if you have questions.

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Workforce PayHub can help simplify the payroll process, making it easier for businesses to manage direct deposit payments and pay stubs for their employees. Contact us today if you have questions.

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