The working world has turned increasingly digital over the past two years. The nature of our workplace — how we meet, communicate, and commute – has made a rapid shift from the physical to the virtual, precipitated by COVID-related lockdowns and social distancing efforts. But what about how we are paid? Or more precisely, what we are paid?
Bitcoin and its numerous cryptocurrency cousins seem to be taking over the world. Little more than a year ago it seemed as if the jury was still out on cryptocurrencies; now, it is increasingly looking like they are here to stay, and bitcoin seems to be leading the way.
Earlier this year, Miami’s mayor, Francis Suarez, proposed allowing city workers to choose to be paid in bitcoin. This was part of a larger strategy by the mayor to make Miami a tech and crypto-friendly city. The city is moving forward with the plan, and is even trying to allow residents to pay municipal fees and taxes in bitcoin. Leading by example, Mayor Suarez announced in early November that he would take his next paycheck in bitcoin. Not to be outdone, and in direct response to Mayor Suarez, New York City mayor-elect Eric Adams announced that he would take his first three paychecks in bitcoin.
America’s mayors may be motivated by a desire to make sure their cities are a hub of the 21st century tech economy, but others are also joining in on the trend. NFL all-pro wide receiver Odell Beckham Jr. announced last week that he would be receiving the entirety of his contract in bitcoin. Earlier in October, Aaron Rodgers of the Green Bay Packers said he’d be paid a portion of his salary in bitcoin. He kicked off his announcement with a well-known credo of the bitcoin community, “Bitcoin: To the Moon.”
While tech seems to move at the speed of light, the US government is an entirely different story. Mayor Suarez may have put together his proposal to pay city workers in bitcoin without consulting with his employment attorneys because as of right now it is unclear whether paying workers in only bitcoin is legal under the federal Fair Labor Standards Act. The Act requires that employers pay workers with cash or “negotiable instruments” like a check. The IRS currently treats cryptocurrencies as property and not currency. The Department of Labor has yet to weigh in, but it may agree with the IRS and decide not to consider bitcoin as “cash or negotiable instruments.” Further complicating matters is the slew of state laws which require workers to be paid in U.S. currency.
The injection of cryptocurrencies into the space of employment compensation is sure to be a rapidly evolving area of law. Before paying workers in bitcoin or any other cryptocurrency employers should consult with an employment attorney.
My colleagues and I discuss this and other predictions for the future of the workforce in Breaking Through the Noise. Now on-demand, the two-hour TV News program addresses employment issues that you will need to know about in a post-pandemic business environment. View the segment starting at 1:57:54 here.