California law makes prepaid card payments for disability benefits permanent

California workers receiving disability benefits within the state's workers' compensation system will now have a permanent payment option via prepaid cards, following Governor Gavin Newsom's signing of law AB 1683. This legislation removes a previous expiration date, ensuring the continued availability of this payment method.

The new law, signed by Newsom on July 6, extends indefinitely the authorization for employers to use prepaid card programs for disability compensation. Previously, this mechanism was only permitted temporarily, with the existing regulation set to expire on January 1, 2027. AB 1683 removes this temporal limit, allowing the system to operate without a future deadline.

Crucially, the law maintains the requirement for employee consent. Employers cannot mandate the use of prepaid cards; employees must provide their written agreement before payments can be deposited onto them. The legislation also specifies several conditions that prepaid cards must meet to be used within the workers' compensation system, including limitations on applicable fees.

AB 1683 was part of a package of bills signed by Newsom, addressing various areas including public transportation, natural resources, skilled nursing facilities, and taxation. The permanent extension of the prepaid card payment option for disability benefits aims to provide flexibility for both employers and employees within the California workers' compensation framework.