I was asked this question by another banker and honestly don't know the answer as I am not familiar with NACHA rules which could effect this.

This is involves employees' payroll, which is direct deposited. Employees get paid every 15th and last day of the month. The logical assumption here is that the funds would be available the morning of that particular pay day. Not the case. Payroll is actually "processed" sometime during that day so it could be in the afternoon or maybe even early in the evening. If checks clear the account that same morning they will be considered NSF if their pay is processed after the cutoff.

Is there a requirement that direct deposit funds be made available at the opening of business that same day, instead of sometime during the day unless the bank says deposits will be processed the day of the 15th and EOM? Processed those dates actually delays their payday one day.

Disregard the fact that you shouldn't write a check unless you know funds are there. That isn't part of the question.

Andy, I am not sure, but I believe that it is supposed to be there at the open of business. (Sounds like they have processing issues). I did email a NACHA contact of mine and will forward the answer to you when I get it.

I also wonder if the payroll policy should indicate "paid on the 15th, available on the 16th", as an example. I believe this would key in the availability and would be separate from any NACHA or other rules.

I asked this question of NACHA before, and they told me that the payroll deposit must be made available to the depositor NO LATER than the opening of business on settlement day (payday).

I am pretty sure that is correct, but was looking for a NACHA guru to confirm it.
(Honestly, I would be annoyed if everyone else who was paid by check was able to pay their bills and I wasn't, considering direct deposit is always touted as being better and more efficient than a check.) That said, it is always there where I bank...always there at the crack of dawn, before the bank is open, oh - it's not the same bank where I work

When the payroll is deposited on the 15 or 30th, you are given provisional credit until the final settlement. This is the same as if you had received a check instead of direct deposit. You deposit your check and may recv provisional credit, but settlement does not occur until that days work is processed. If checks are presented on the night of the 14th, the funds are not there even thou the deposit will show as provisional the next morning. Therefore the account is OD, the bank will see there was a deposit and will most likely pay the item and charge for the OD. The ACH deposit does not have to show the first thing in the morning, it could occur anytime during the day (after the previous days's cutoff), depends on when the bank of deposit runs the 'tape'.

Just as a clarification, the RDFIs cannot, of course, post the funds any quicker than the ACH items themselves are received. So if the company payroll in question is not actually even originated until the 15th, then the RDFIs cannot post the funds until the opening of business on the 16th. (The ODFI sends the items out on the 15th, and the RDFIs receive them later in the day on the 15th or on the morning of the 16th, depending upon the timing of the ODFI's release and the receiving cycle of the RDFIs--one daily file, for instance, versus two or three. Even if the ODFI sends the payroll items out on the early morning of the 15th and the RDFIs pick them up in the afternoon, the receiving banks might not get their settlement through the Fed until the next day, and they aren't obligated to make the funds available to the receivers on that same day in such a case.)

Of course, under some scenarios the RDFIs will be memo posting some of the ACH transactions, so even if they receive them late on the 15th but aren't releasing them to hard post to DDA until the 16th, there might be a memo post distribution in the evening of the 15th that would make funds available via ATMs and might also counteract NSFs on check clearings.

As always, there are my opinions only.

In the Operating Guidelines (OG53)
An entry or entry data is made available to an RDFI or its receiving point when the entry or entry data is processed by the RDFI's ACH Operator and is ready for distribution. "Opening of business" is defined as the later of 9:00 a.m. (RDFI's local time) or the time the RDFI's teller facilities (including ATMs) are available for customer account withdrawals.