Our policy is that employees are allowed to have 2 free checking and 1 free savings or 1 free checking and 2 free savings. To streamline this, we are wanting to create an employee account for DDA and SAV if they choose to have these accounts. Is there a problem with having such?

None that I can see. What are you going to do if they quit?

Thanks - good question - I would think we would transfer them to another account.

Our employee policy calls for such an account, with the caveat that when they are no longer employed that it will revert to a regular checking account. This way there shouldn't be a surprise when they start incurring fees after they leave.

I would give them a standard account with the employee benefit of the account service charge being waived for the duration of their employment. When they are gone or retired, you just flip the service charge switch. No fuse - no muss, no transfer, no new disclosures, etc.

We open regular account and code them as an employees and if at some point, they no longer work for us, the code is changed to a regular customer and they keep the same account numbers, checks and debit cards.

That's what we do...no fuss, no muss!

Just make sure you take the step of providing the disclosures for the regular account that reflect the normal pricing, and any changes in terms that apply to that account so that, if the employee departs the bank, you don't have to figure out which disclosures he or she has received before you rescind the waiver.

Another question on this topic. Do we need to include employee account benefits in our disclosures (or provide separate disclosure for employees)? Employees are on regular accounts and receive all disclosures and change in terms that any other customer would receive. Employees are made aware of the benefits available to them through internal communications.

Please review John's post. Your employees get the same disclosure everyone else does at account inception. They would also receive a disclosure indicating what the different terms are; e.g. no service charges, and an indication that those different terms would be in effect only as long as they continued to be an employee of your bank.

As suggested, design it in such a way that all you need to do on their departure is change an account code, not send out a new disclosure.