New York State Wage Theft Prevention Act, WTPA - Labor Law - by Deanne Braveman, Esq.

New York State Wage Theft Prevention Act, WTPA - Labor Law

March 30, 2011

Written By: Deanne Braveman

Labor laws are designed to create safe working environments and guarantee employees a minimum wage, the right to take meal breaks, workers compensation when injured, and the right to address violations of the law and seek redress. “Broken Laws, Unprotected Workers” reports the findings of a 2008 study of low wage workers in Los Angeles, Chicago, and New York City. This study found rampant violations of minimum wage, overtime, meal break, pay stub, and other labor protections.

The rates of wage theft and other labor law violations are staggering. Of the 4,387 workers in the study, 68 percent experienced at least one pay-related violation in the previous week. The average worker lost $51, out of average weekly earnings of $339, to labor law violations. This amounts to 15 percent of weekly earnings. The average worker in this study put in 11 hours of overtime that were underpaid or not paid at all. Eighty six percent of study participants worked enough hours to require a meal break. However, 69 percent of these individuals did not receive their break, had it shortened, or had to work through it.

The Wage Theft Prevention Act (WTPA) seeks to address these problems by clarifying New York State law regarding wage protections and expand the rights of employees to seek civil and criminal avenues of remedy for their employer's violation of labor law. The WTPA was introduced by Senator Diane Savino and Assembly Member Carl Heastie during the 2010 legislative session. The bill was passed by both houses and signed into law by Governor Paterson on December 10, 2010 as Chapter 564 of the laws of 2010. The WTPA takes effect on April 9, 2011. Below is a summary of the changes to the New York State Labor law under the WTPA by section of law.

Pre-Employment Notice of Wage Rates (Labor Law Section 195, Subdivisions 1, 2, 3 and 4)

Labor Law Section 195 governs notice and record keeping requirements that employers must engage in. The WTPA clarifies that an employer must disclose the intent to claim allowance (i.e. tip or meal allowances) as part of the minimum wage and the basis for payment (i.e. by hour, shift, day, week, piece). WTPA adds a requirement that the employer must disclose their “doing business as” name and contact information of the employer’s principal place of business. This information must be provided at the time of hire, annually, and within 7 days of any change if the employers address is not listed on pay stubs. The information must be provided in English and the primary language of the employee as designated by the employee. The New York State Department of Labor (DOL) is authorized to provide templates of these forms in English and those other languages as the Commission deems necessary. Employees are required to affirm that they have accurately told their employer of their primary language.

The WTPA also codifies requirements of information that must be included in pay stubs. This includes: dates of work covered by payment, name of employee and employer, address and phone number of employer, rate of pay and basis of pay (i.e. hourly, shift, piece, etc), and any allowances claimed as part of the minimum wage. Employers are required to keep payroll records for six years.

Powers of the Commissioner (Labor Law Section 196)

Labor Law Section 196 outlines powers of the Commissioner of DOL to investigate violations of the Labor Law and enforce penalties. The Commissioner now has the discretion to demand an employer to provide an accounting of assets of the employer including bank accounts, accounts receivable, personal property, real property, etc. If the employer does not comply with this demand in a timely manner the Commissioner is empowered to bring an action in Supreme Court to compel the employer to furnish the accounting. A civil penalty of no more than $10,000 is authorized if the Commissioner must go to court to compel compliance. The Commissioner may also require an employer to post bond after default on an order to comply.

Complaints by Employee to Commissioner (Labor Law Section 196-a)

Labor Law Section 196-a allows the Commissioner to discuss a complaint by an employee with a representative of their collective bargaining unit. The WTPA codifies the DOL policy of maintaining the identity of an employee involved in an investigation as confidential.

Civil Penalty (Labor Law Section 197)

Labor Law Section 197 allows the Commissioner to recover a fine from an employer who differentiates rates of pay on the basis of sex. Prior to the WTPA the Commissioner could only recover this fine in a court proceeding. Under the WTPA the Commissioner can recover the fine during an administrative proceeding.

Costs, Remedies (Labor Law Section 198)

Labor Law Section 198 outlines costs and remedies (Please see PDF)

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