The advance is made only against the accrued cash value of any wages the employee has earned up to the date of the advance
1. The advance is made by an employer, as defined in the Fair Labor Standards Act, 29 U.S.C. 203(d), or by the employer’s business partner (e.g., a company that provides payroll card services or accounting services to the employer, or a company that provides consumer financial products and services as part of the employer’s benefits program such that the company would have information regarding the employee’s accrued wages).
3. The amount advanced must not exceed the employee’s accrued wages. Accrued wages are unpaid wages that the employee is entitled to receive for work performed for the employer in the event of separation. Comment 1041.3(d)(7)(i)-1.
4. Before funds are advanced, the entity advancing the funds warrants all of the following to the employee (as part of the contract between the parties and on behalf of itself and any business partners):
- The consumer (i.e., the employee) will not be required to pay any charges or fees in connection with the advance (other than a charge for participating in the wage advance program);
- The entity and its business partners do not have any legal or contractual claim or remedy against the consumer based on the consumer’s failure to repay.