Responsible New York employers know that they’re responsible to accurately compensate their employees. And, of course, no one likes not being paid for work they’ve performed. As it turns out, the New York government also feels strongly about so-called employee wage theft. In the past two years alone, the State has recovered over $63 million from New York employers allegedly because of so-called stolen wages.
No employer wants to be out of compliance with wage theft-related laws, because the consequences are dire, including compensatory damages, interest, fines and potential litigation. Thankfully, the laws are simple to follow, and following them shields your business from liability.
So we thought we’d revisit this almost-15-year-old law to make sure you’re in the know.
What’s the law?
In 2011, New York enacted the Wage Theft Protection Act. The law dictates that all private-sector employers must providea notice to employees regarding wages. Broadly, all employees must receive pay notices in writing at the time of hire, as well as at any time there’s a decrease in their compensation.
What does the notice require?
At the time of hire, every employee must receive a written wage notice. The employee must also receive a new notice if any of the terms on the notice are changed and if those changes aren’t reflected on their pay stub. As well, employees are entitled to a new notice if their pay decreases. Fortunately, for most employees, new notices are not required when pay increases.
New York is very clear on what the notice must contain. The Department of Labor provides a template for employers to use. Generally, the written notice must contain the following information:
- Employee’s rate(s) of pay and overtime rate, if applicable;
- How the employee is paid (by hour, shift, day, etc.);
- The employee’s regular payday;
- The employer’s name, address, and telephone number; and
- Any allowances taken as part of the minimum wage (e.g., uniform expenses).
The notice must be in English as well as the employee’s primary language (the State has the form translated into several languages, here). Each employee must sign the notice and be given a copy for her records.
Any changes to this information needs to be provided to the employees at least one week before the change occurs, unless the notice is included in a paystub. Again, only decreases in pay qualify; increases in pay aren’t covered except in the hospitality industry.
What recordkeeping requirements exist?
Employers must keep the wage theft notice records for six years. As all responsible employers know, they also must keep records of all hours worked by employees, as well as copies of pay stubs, for six years. Back-dating records is expressly prohibited under the law, so your recordkeeping needs to be done promptly and completely to avoid potential penalties.
Practice Pointer: every personnel file should have a signed employee wage theft form in it.
What if we don’t comply?
First, it’s hard to deny that compliance with this particular law is reasonably straightforward, although it does require one more form to complete when onboarding a new team member. Since it’s easy to comply, the Department of Labor isn’t very forgiving when the requirements aren’t met. So, the State isn’t shy about pursuing companies that don’t comply.
If an employer doesn’t provide a wage theft notice to its employees it may be fined up to $50 per day per employee. Also, workers are allowed to sue their employers for money damages, and the maximum they can collect is $5,000 per employee. For example, if an employer fails to provide a wage notice to 10 employees for 5 days, it could be liable for $2,500 in government fines and $50,000 in money damages to employees, plus legal expenses. At the end of the day, no one wants to owe tens of thousands of dollars for not providing their employees with a one-page notice.
While this article isn’t specifically about pay stubs, if an employer fails to provide employees with a pay stub it can be fined up to $250 per day per employee. Of course there are other, more severe, damages for failing to properly pay your employees. These damages are simply for not providing your employees with the proper notices.
New York has made it clear that it’s serious about wage theft, and Governor Hochul is cracking down on it. Compliance is simple, if you know what to include and when to provide it. That’s why we’re reminding you of what’s needed.
How do I make sure I’m not ensnared by the law?
If you want to make sure your business is in compliance, call us. We can help ensure compliance with New York and federal labor and employment laws. While some laws are simpler than others, it’s still a lot to digest and implement. We’re your trusted partners – just like you, except with a law degree. Contact us anytime, at either info@coppolalegal.com or 716.839.9700.
