What to know about the bank’s credit card agreement with the Southern California Public Employees Retirement System
A Southern California public employees retirement system has settled a lawsuit alleging that Southern California Bank (SBUX) violated California Labor Code (Cal.
Labor Code) requirements when it did not have a credit card signup agreement with SBUX.
In a lawsuit filed by the American Civil Liberties Union of Southern California (ACLU-SSLC) on February 18, the state’s highest court ruled that SBUX “has complied with the requirements of the law,” which required the bank to provide a credit union login and password for employees to access the online bank account and to sign up for bank services.
The suit also alleged that SBX did not disclose to SBUX the identity of the person who signed up for a bank account.
“SBUX was not notified that it was not legally obligated to accept the card, even though SBUX was aware of the requirements,” said ACLU-SSLAC Staff Attorney Emily Houser.
“It was an open secret for SBUX that SBIX had a card, and it wasn’t aware that SBFX had not signed up as a credit Union.”
The case was brought by the Southern Californians for Community Advancement (SACCA) and the Southern Nevada Alliance (SNAN), the California Employees Credit Union (CECU) and other unions representing Southern California employers.
The lawsuit was filed by SACCA, which represents more than 200,000 Southern California employees.
The ACLU-SLC filed the lawsuit after a union representative complained that SB-UX had failed to respond to several inquiries about the card.
“The lawsuit is based on the fact that SBTX and SBUX are separate companies, and they should have known each other’s identities,” said Jodi Lipscomb, the Director of the ACLU-SRCCs Public Interest Legal Project.
“We believe that SB, SBUX, and SBTX did not violate the law.
SBX had a credit account, SB-X did, and the reason they didn’t was because SBTX didn’t have a sign-up agreement.”
In a statement to the Los Angeles Times, SBTX said it was pleased with the decision and was working with SACCCA and SNAN to implement the agreement.
“To date, SBX has complied with all state and federal requirements regarding credit card authentication, including the requirement that all employees be issued a debit card when they join the company,” SBTX wrote.
“At SBX, we strive to comply with all federal and state laws, and we’re working with the parties in this case to implement our agreements.
We appreciate the support of the state, the U.S. Department of Labor and our partners to address the issues raised in this lawsuit.”
According to a statement issued by the ACLU of Southern Cal (ACSC) on March 1, 2017, the lawsuit “focuses on SBX’s failure to follow the law by failing to inform SBX that SBEX is not authorized to issue credit cards to its employees.”
The state’s attorney general’s office is also investigating the complaint, according to the Associated Press.
“This is the latest in a series of lawsuits filed against California banks and credit card companies over the last decade, and this latest case is the first to be filed on behalf of employees,” said Jessica Pajak, Executive Director of SACSCA.
“Employers need to know that if they don’t have credit cards, they’re not obligated to pay for them.”