Class Action Suits Against Bank Of America And Wells Fargo Are Expected To Affect Thousands Of California Employees

LOS ANGELES, CA, April 22, 2004—A class action lawsuit has been filed against Bank of America for charging employees of business payroll account holders fees to cash their paychecks, affecting tens of thousands of employers and employees throughout California. A similar suit is being filed today against Wells Fargo Bank.

The plaintiffs in the suits against Bank of America and Wells Fargo are two California employers who believe the banks' fees have placed them in violation of Section 212 of the California Labor Code, which requires that paychecks ‘be negotiable and payable in cash, on demand, without discount.’ The plaintiffs are acting on behalf of all other employers in the state, many who have lower-paid workers living paycheck to paycheck.

“We are seeking injunctions to stop the banks from charging the $5 per paycheck cashing fees and obtain a refund of all such fees already paid by thousands of employees in California—mostly lower-paid workers who don’t hold personal checking accounts and rely on their employers’ banks to cash their checks,” says Nick Roxborough, a partner of Los Angeles based Roxborough, Pomerance & Nye LLP who filed the lawsuits. "The total collected to date is easily in the tens of millions of dollars," he estimates.

The Department of Industrial Relations, which is responsible for enforcing the labor code, already concurred during recent State Senate hearings that the fees violate the California Labor Code, stating that it subjects employers to criminal prosecution and substantial penalties under Labor Code 215 and 225. The State Senate has been holding hearings regarding this issue and legislation is now pending to further prohibit banks from charging these types of fees.

The suit against Bank of America was filed by a Visalia, Tulare County nonprofit called Karis House, which runs six homes for troubled teens. A Bakersfield firm called Ability Answering-Paging Service is the plaintiff in the Wells Fargo suit.

Roxborough is confident the courts will rule in favor of the plaintiffs and the California employers they represent, as well as provide restitution for the employees who have been affected by the banks’ charges. "We have great confidence that the right thing will be done for both consumers and the employer community," he adds.

Roxborough, Pomerance & Nye LLP (RPN) is a Los Angeles-based law firm providing expert legal counsel and representation to the business community. Established in 1996, the firm offers a broad range of legal services in all facets of civil litigation with its primary focus on business, insurance, employment, and wage and hour litigation. It is the first law firm in the country to specialize in and make new law when representing employers in workers’ compensation premium and dividend disputes with insurance carriers.

ATTN. REPORTERS: Please contact Linda O’Hanlon at 818-386-1916 if you would like to receive a hard copy of the lawsuits.

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