Wal-Mart and Home Depot are among the companies being investigated by the New York attorney general over fees charged employees on prepaid cards used as worker paychecks.

Companies, which include Time Warner Cable and Darden Restaurants, were asked for information about their use of the cards, including disclosures to employees and the fees workers pay, according to letters obtained by Bloomberg News.

"We are concerned about excessive or insufficiently disclosed fees which may unduly reduce employees' take-home pay," New York Attorney General Eric Schneiderman's office said in letters to the companies yesterday.

The use of prepaid payroll cards is growing, according to a February 2013 report by research and advisory firm Aite Group, which said $34 billion in gross dollar volume was loaded onto 4.6 million active payroll cards in 2012. The firm projects those figures to rise by 2017 to $68.9 billion and 10.8 million cards.

Banks with payroll card programs include Bank of America, JPMorgan Chase and Wells Fargo, according to the report. Aite Group calls payroll cards a "sales opportunity" for bank issuers that may generate fees and produce new consumer-banking customers.

Separately, Schneiderman is probing possible labor violations by New York fast-food restaurants, including failure to pay overtime and insufficient reimbursement for work-related expenses.

In the inquiry into payroll cards, New York is seeking information to determine whether the companies' practices comply with state labor law, according to the letters.

Wal-Mart employees have the option of being paid by direct deposit, paper checks or payroll cards, and they may use the card to make free unlimited cash withdrawals at stores, said spokesman Randy Hargrove. The Bentonville, Arkansas-based retailer met with New York's Labor Department after starting the program in 2009, he said.

The attorney general has also contacted Costco Wholesale Corp. and Walgreen Co.

Darden Restaurants, whose brands include Olive Garden and Red Lobster, said it complies with New York's regulations, Hunter Robinson, a spokesman for the Orlando, Florida-based company, said in an e-mail.

"We have received strong feedback from our employees who prefer the pay card, as it is a convenient way to get access to their pay without incurring check-cashing fees," he said.

Walgreen employees aren't required to accept wages on the payroll cards, Jim Graham, a spokesman for the Deerfield, Illinois-based company, said in an e-mail. The company negotiated agreements with ATM providers in its stores to accept Walgreen pay cards without withdrawal fees, he said.

New York law requires employees to give advance written consent for payment of wages by payroll cards. A company can't make use of a card a condition of employment, Schneiderman's office said.

Schneiderman wants a summary report of fees paid by employees or deducted from their accounts and copies of documents provided to employees. He's also seeking communications between the companies and their payroll card provider or financial institution.

"Employees must have a method to obtain all of their wages in a timely manner, without incurring fees," Schneiderman's office said in the letters.

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