Which of the following is not a disadvantage of the direct deposit system to the employer?

The correct answer identifies a characteristic of the direct deposit system that benefits the employer rather than posing a disadvantage. When employers utilize direct deposit, they eliminate the need to issue physical checks and manage associated paperwork, such as filing and storing cashed checks and related documents. This reduces administrative burden and improves efficiency within the payroll processing workflow.

In contrast, the other options present genuine disadvantages associated with direct deposit. For instance, direct deposit remains somewhat dependent on traditional banking systems, and as such, employers cannot dictate which bank an employee uses for their direct deposits, which might inconvenience some employees. Additionally, direct deposit usually involves the employer losing out on interest accrued from payroll funds while waiting for paychecks to clear in the banking system. Finally, while many perceive direct deposit as a move towards a more paperless payroll system, it still involves some level of documentation, particularly in terms of providing statements and records to employees. Therefore, option C stands out as not being a disadvantage but rather an advantage of direct deposit for employers.