Bill Text: FL S1146 | 2024 | Regular Session | Introduced
Bill Title: Earned Wage Access Providers
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2024-03-08 - Died in Banking and Insurance [S1146 Detail]
Download: Florida-2024-S1146-Introduced.html
Florida Senate - 2024 SB 1146 By Senator Trumbull 2-01118-24 20241146__ 1 A bill to be entitled 2 An act relating to earned wage access providers; 3 creating part V of ch. 560, F.S., entitled “Florida 4 Earned Wage Access Services Act”; creating s. 560.409, 5 F.S.; providing a short title; creating s. 560.410, 6 F.S.; defining terms; creating s. 560.411, F.S.; 7 defining terms; requiring providers of earned wage 8 access services to register with the Financial 9 Services Commission; specifying the information that 10 must be included with the application; requiring the 11 commission to issue a proof of registration to 12 qualified applicants; requiring that the registration 13 or the registration number, as applicable, be 14 displayed in a specified manner; requiring that 15 registrations be renewed biennially; authorizing the 16 commission to extend the expiration date of a 17 registration for a specified purpose; prohibiting 18 assignment of a registration and the conduct of 19 business under more than one name; authorizing the 20 commission to deny, refuse to renew, or revoke a 21 registration for specified reasons; requiring the 22 commission to deny or refuse to renew a registration 23 under certain circumstances; creating s. 560.412, 24 F.S.; providing requirements for registered providers; 25 prohibiting certain activities on the part of 26 registered providers; providing construction; 27 authorizing providers to use a mailing address 28 provided by a consumer to determine a consumer’s state 29 of residence; creating s. 560.413, F.S.; providing 30 applicability; creating s. 560.414, F.S.; authorizing 31 the commission to issue orders imposing certain 32 actions or penalties for violations, including 33 imposition of administrative fines; authorizing the 34 commission to adopt rules; requiring the commission to 35 adopt an application for registration; authorizing 36 certain providers to operate without registration for 37 a specified timeframe after the effective date of this 38 act under certain conditions; providing an effective 39 date. 40 41 Be It Enacted by the Legislature of the State of Florida: 42 43 Section 1. Part V of chapter 560, Florida Statutes, 44 consisting of sections 560.409 through 560.414, Florida 45 Statutes, is created to read: 46 47 PART V 48 49 FLORIDA EARNED WAGE ACCESS SERVICES ACT 50 51 560.409 Short title.—This part shall be known as the 52 “Florida Earned Wage Access Services Act.” 53 560.410 Definitions.—As used in this part, the term: 54 (1) “Business entity” means any corporation, limited 55 liability company, partnership, association, or other commercial 56 entity. 57 (2) “Commission” means the Financial Services Commission. 58 (3) “Consumer” means an individual who resides in this 59 state. 60 (4) “Consumer-directed earned wage access services” means 61 the business of delivering to consumers access to earned but 62 unpaid income that is based on the consumer’s representations 63 and the provider’s reasonable determination of the consumer’s 64 earned but unpaid income. 65 (5) “Earned but unpaid income” means salary, wages, 66 compensation, or other income that a consumer or an employer has 67 represented, and that a provider has reasonably determined, has 68 been earned or accrued to the benefit of the consumer in 69 exchange for the consumer’s provision of services to the 70 employer or on behalf of the employer, including on an hourly, 71 project-based, piecework, or other basis and including 72 circumstances in which the consumer is acting as an independent 73 contractor of the employer, but has not, at the time of the 74 payment of proceeds, been paid to the consumer by the employer. 75 (6) “Earned wage access service” means the business of 76 providing consumer-directed earned wage access services or 77 employer-integrated earned wage access services, or both. 78 (7) “Employer” means a person or an entity that employs a 79 consumer or any other person who is contractually obligated to 80 pay a consumer earned but unpaid income in exchange for the 81 consumer’s provision of services to the employer or on behalf of 82 the employer, including on an hourly, project-based, piecework, 83 or other basis and including circumstances in which the consumer 84 is acting as an independent contractor with respect to the 85 employer. The term does not include a customer of an employer, 86 or any other person whose obligation to make a payment of 87 salary, wages, compensation, or other income to a consumer is 88 not based on the provision of services by that consumer for or 89 on behalf of the person. 90 (8) “Employer-integrated earned wage access services” means 91 the business of delivering to consumers access to earned but 92 unpaid income that is based on employment, income, or attendance 93 data obtained directly or indirectly from an employer. 94 (9) “Fee” includes a fee imposed by a provider for delivery 95 or expedited delivery of proceeds to a consumer or a 96 subscription or a membership fee imposed by a provider for a 97 bona fide group of services that includes earned wage access 98 services; however, the term does not include a voluntary tip, 99 gratuity, or other donation. 100 (10) “Outstanding proceeds” means proceeds remitted to a 101 consumer by a provider which have not yet been repaid to the 102 provider. 103 (11) “Proceeds” means a payment to a consumer by a provider 104 which is based on earned but unpaid income. 105 (12) “Provider” means a business entity that is in the 106 business of providing earned wage access services to consumers; 107 however, the term does not include either of the following: 108 (a) A service provider, such as a payroll service provider, 109 whose role may include verifying the available earnings but 110 which is not contractually obligated to fund proceeds delivered 111 as part of an earned wage access service. 112 (b) An employer that offers a portion of salary, wages, or 113 compensation directly to its employees or independent 114 contractors before the normally scheduled pay date. 115 (13) “Registrant” means a business entity registered with 116 the commission under s. 561.02(1) as an earned wage access 117 services provider. 118 560.411 Registration.— 119 (1) For the purposes of this section, the term: 120 (a) “Applicant” means a provider that has submitted an 121 application for a certificate of registration under subsection 122 (2). 123 (b) “Director” means a member of the applicant’s or 124 registrant’s board of directors. For purposes of this paragraph, 125 the term “member” means a person who has the right to receive 126 upon dissolution, or has contributed, 10 percent or more of the 127 capital of an applicant or registrant that is organized as a 128 limited liability company. 129 (c) “Key officer” includes the chief executive officer, the 130 chief financial officer, and the chief compliance officer. 131 (d) “Partner” means a person that has the right to receive 132 upon dissolution, or has contributed, 10 percent or more of the 133 capital of an applicant or a registrant that is organized as a 134 partnership. 135 (2) Each provider shall register with the commission. An 136 applicant must provide its legal business and trade name, 137 mailing address, business locations, and the full names and 138 addresses of its partners, members, or directors and key 139 officers, and the Florida agent of the corporation; must state 140 whether it is a domestic or a foreign corporation; must provide 141 its state and date of incorporation, its charter number, and, if 142 it is a foreign corporation, the date it registered with the 143 Department of State; and, if the provider is operating under a 144 fictitious or trade name, must provide the date on which it 145 registered its fictitious name. 146 (3) A certificate evidencing proof of registration must be 147 issued by the commission and must be prominently displayed at 148 the provider’s primary place of business; however, if the 149 provider conducts business on a website, the provider must post 150 its registration number on its website. 151 (4) A registration must be renewed biennially on or before 152 its expiration date. In order to establish staggered expiration 153 dates, the commission may extend the expiration date of a 154 registration for a period not to exceed 12 months. 155 (5) A registration issued under this chapter is not 156 assignable, and the provider may not conduct business under more 157 than one name except as registered. A provider desiring to 158 change its registered name, location, or designated agent for 159 service of process at a time other than upon renewal of 160 registration must notify the commission of the change. 161 (6) The commission may deny, refuse to renew, or revoke the 162 registration of a provider based upon a determination that any 163 of the following criteria applies to the provider, or any of the 164 provider’s partners, members, or directors and key officers: 165 (a) Has failed to meet the requirements for registration as 166 provided in this chapter. 167 (b) Has been convicted of a crime involving fraud, 168 dishonest dealing, or any other act of moral turpitude. 169 (c) Has not satisfied a civil fine or penalty arising out 170 of an administrative or enforcement action brought by a 171 governmental agency or a private person based upon conduct 172 involving fraud, dishonest dealing, or any violation of this 173 chapter. 174 (d) Has pending against it any criminal, administrative, or 175 enforcement proceedings in any jurisdiction, based upon conduct 176 involving fraud, dishonest dealing, or any other act of moral 177 turpitude. 178 (e) Has had a judgment entered against it in any action 179 brought by the commission or the Department of Legal Affairs 180 under this chapter or the Florida Deceptive and Unfair Trade 181 Practices Act. 182 (7) The commission shall deny or refuse to renew the 183 registration of a provider or deny a registration or renewal 184 request by any of the provider’s partners, members, or directors 185 and key officers if such entities have not satisfied a civil 186 penalty or administrative fine for a violation of s. 560.412. 187 560.412 Provider requirements; limitations.— 188 (1) A provider required to register under s. 560.411(2) 189 shall do all of the following: 190 (a) Develop and implement policies and procedures to 191 respond to questions raised by consumers and address complaints 192 from consumers in an expedient manner. 193 (b) Offer to the consumer at least one reasonable option to 194 obtain proceeds at no cost to the consumer and clearly explain 195 how to elect the no-cost option. 196 (c) Before entering into an agreement with a consumer for 197 the provision of earned wage access services: 198 1. Inform the consumer of his or her rights under the 199 agreement; and 200 2. Fully and clearly disclose all fees associated with the 201 earned wage access services. 202 (d) Inform the consumer of any material changes to the 203 terms and conditions of providing the earned wage access 204 services before applying those changes to that consumer. 205 (e) Allow the consumer to cancel use of the provider’s 206 earned wage access services at any time, without incurring a 207 cancellation fee or penalty imposed by the provider. If the 208 consumer has initiated an advance of proceeds, the provider may 209 require the effective date of the cancellation to be after the 210 consumer has satisfied any repayment obligation the consumer has 211 to the provider, either through payroll deduction, preauthorized 212 electronic funds transfer from a consumer’s account or 213 depository institution, or other means previously agreed to by 214 the consumer and the provider. This paragraph does not require a 215 provider to allow a consumer-initiated advance to be canceled, 216 revoked, suspended, or reversed after the consumer initiates the 217 advance. 218 (f) Comply with all applicable local, state, and federal 219 privacy and information security laws. 220 (g) If the provider solicits, charges, or receives a tip, 221 gratuity, or other donation from a consumer: 222 1. Disclose, clearly and conspicuously, to the consumer 223 immediately before each transaction that a tip, gratuity, or 224 other donation amount may be zero and is voluntary; and 225 2. Disclose, clearly and conspicuously, in the service 226 contract with the consumer that tips, gratuities, and donations 227 are voluntary and that the offering of earned wage access 228 services, including the amount of proceeds a consumer is 229 eligible to request and the frequency with which proceeds are 230 provided to a consumer, is not contingent on whether the 231 consumer pays any tip, gratuity, or other donation or on the 232 size of a tip, gratuity, or other donation. 233 (h) Provide proceeds to a consumer by any means mutually 234 agreed upon by the consumer and the provider. 235 (i) If the provider will seek repayment of outstanding 236 proceeds or payment of fees or other amounts owed, including 237 voluntary tips, gratuities, or other donations, in connection 238 with the activities covered by this chapter, from a consumer’s 239 depository institution, including by means of electronic funds 240 transfer: 241 1. Comply with applicable provisions of the Electronic Fund 242 Transfer Act, 15 U.S.C. s. 1693, and regulations adopted under 243 the act; and 244 2. Reimburse the consumer for the full amount of any 245 overdraft or insufficient funds fees imposed on the consumer by 246 the consumer’s depository institution which were caused by the 247 provider attempting to seek payment of any outstanding proceeds, 248 fees, or other payments in connection with the activities 249 covered by this chapter, including voluntary tips, gratuities, 250 or other donations, on a date before, or in an incorrect amount 251 from, the date or amount disclosed to the consumer. However, the 252 provider is not subject to the requirements in this subparagraph 253 with respect to payments of outstanding amounts or fees incurred 254 by a consumer through fraudulent or other unlawful means. 255 (2) A provider required to register under s. 560.411(2) may 256 not do any of the following: 257 (a) Share with an employer a portion of any fees, voluntary 258 tips, gratuities, or other donations that were received from or 259 charged to a consumer for earned wage access services. 260 (b) Require a consumer’s credit report or a credit score 261 provided or issued by a consumer reporting agency to determine a 262 consumer’s eligibility for earned wage access services. 263 (c) Accept payment of outstanding proceeds, fees, voluntary 264 tips, gratuities, or other donations from a consumer by means of 265 a credit card or charge card. 266 (d) Charge a late fee, deferral fee, interest, or any other 267 penalty or fee for failure to pay outstanding proceeds, fees, 268 voluntary tips, gratuities, or other donations. 269 (e) Report to a consumer reporting agency or debt collector 270 any information about the consumer regarding the inability of 271 the consumer to pay outstanding proceeds, fees, voluntary tips, 272 gratuities, or other donations. 273 (f) Compel or attempt to compel payment by a consumer of 274 outstanding proceeds, fees, voluntary tips, gratuities, or other 275 donations to the provider through any of the following means: 276 1. A suit against the consumer in a court of competent 277 jurisdiction. 278 2. Use of a third party to pursue collection from the 279 consumer on the provider’s behalf. 280 3. Sale of outstanding amounts to a third-party collector 281 or debt buyer for collection from the consumer. 282 283 The prohibition imposed in this paragraph does not preclude the 284 use by a provider of any of the methods specified in this 285 paragraph to compel payment of outstanding amounts or fees 286 incurred by a consumer through fraudulent or other unlawful 287 means, nor does it preclude a provider from pursuing an employer 288 for breach of its contractual obligations to the provider. 289 (g) Mislead or deceive consumers about the voluntary nature 290 of tips, gratuities, or donations or make representations that 291 tips, gratuities, or other donations will benefit any specific 292 individuals. 293 (3) A provider may use the mailing address provided by a 294 consumer to determine the consumer’s state of residence for 295 purposes of this part. 296 560.413 Applicability.— 297 (1) Notwithstanding any other provision of law, earned wage 298 access services offered and provided by a registrant in 299 compliance with this chapter are not considered to be any of the 300 following: 301 (a) In conflict with s. 516.17 or other state law governing 302 the sale or assignment of, or an order for, earned but unpaid 303 income. 304 (b) A loan or other form of credit or debt, and the 305 provider is not considered a creditor, debt collector, or lender 306 with respect to such services. 307 (c) Money transmission, and the provider is not considered 308 a money transmitter, as defined in s. 560.103(24), with respect 309 to such services. 310 (2) Chapter 516 does not apply to proceeds that a provider 311 provides to a consumer in accordance with this part. 312 (3) A voluntary tip, gratuity, or other donation paid by a 313 consumer to a registrant in accordance with this chapter is not 314 considered a finance charge. 315 560.414 Administrative remedies, penalties.— 316 (1) The commission may issue an order for one or more of 317 the following actions or penalties if it finds that a provider 318 has violated or is operating in violation of this part or rules 319 adopted pursuant thereto: 320 (a) Issue a notice of noncompliance under s. 120.695. 321 (b) Impose an administrative fine in the Class II category 322 pursuant to s. 570.971 for each act or omission. 323 (c) Direct that the provider cease and desist specified 324 activities. 325 (d) Refuse to register or revoke or suspend a registration. 326 (e) Place the registrant on probation, subject to 327 conditions specified by the commission. 328 (2) The administrative proceedings that could result in the 329 entry of an order imposing any of the actions or penalties 330 specified in subsection (1) are governed by chapter 120. 331 (3) The commission may adopt rules under ss. 120.536(1) and 332 120.54 to administer this part. 333 Section 2. On or before the effective date of this act, the 334 commission shall prescribe the form and content of an 335 application for registration to provide earned wage access 336 services pursuant to this act. A provider that, as of January 1, 337 2024, is engaged in the business of providing earned wage access 338 services in this state may, until 6 months after the effective 339 date of this act, continue to engage in such business without 340 registering if the provider has submitted an application for 341 registration and otherwise complies with this act. 342 Section 3. This act shall take effect October 1, 2024.