If your staff member wants his or her paycheck in cryptocurrency, should you – as an employer keeping up with the times -- accommodate the request?
You don’t have to work in Silicon Valley or play for the NFL to field this type of question. In 2022, more traditional workplaces from manufacturing facilities to municipal governments have faced this dilemma. In January, New York City Mayor Eric Adams drew public attention to his decision to convert his first three paychecks into Bitcoin and Ethereum, through the cryptocurrency exchange Coinbase. Since then, blockchain and digital assets have only become more mainstream, with investors considering them as part of estate planning and companies adapting, by necessity, to transactions grounded in digital assets. Are salary and wages next? Given potential wage and hour risks, tax compliance issues, and even federal securities regulation, should employers seriously consider wage payment in digital currency?
Federal considerations: The federal Fair Labor Standards Act requires that all wages and other compensation governed by this statute be paid “in cash or negotiable instrument payable at par.” Limited exceptions do exist, in certain circumstances, for things like food, lodging, transportation and fuel, or even credit at the company store. It’s one thing to distribute croissants and coffee for employees coming in early, or to reimburse them for gas mileage. Digital currency – intangible, not accepted at all stores, and still...
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