New Law – Bi-weekly Payment of Wages

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As of January 1, 2014, a newly-enacted section of the Rhode Island Payment of Wages Act will allow certain private sector employers to pay their employees less frequently than weekly.  Employers who wish to run less frequent payrolls must petition the Director of the Rhode Island Department of Labor and Training in writing, showing good and sufficient reason why they should be permitted to pay their employees bi-weekly, rather than weekly.  Until now, the law allowed only the State, cities and towns, and nonprofit employers to pay their employees less often than weekly.

To be eligible for the Director of Labor and Training approval, the employer must demonstrate that its average payroll exceeds two hundred (200%) percent of the State Minimum Wage (currently $7.75 per hour).   The employer must agree to pay wages on a pre-designated date no less than twice per month, and it must provide the Director with proof of a surety bond or some other form of security in the amount of the highest bi-weekly payroll exposure in the preceding year.

Employers whose average payroll is less than two hundred (200%) percent of the State Minimum Wage may also petition the Director to pay their employees less frequently than weekly, provided the employer has furnished to the Department certain information, including the method by which wages shall be paid, the requested frequency of payment, the employer’s designated payday(s), and the classification and salary range of the employees involved.  The employer must also make regular payment of wages no less than twice per month.

An employer petitioning the Director for permission to run fewer payrolls must also have no history of wage and hour violations, and if its employees are subject to a collective bargaining agreement, the employer must also provide the Director with the union’s written consent to the new wage payment arrangement.

 

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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