New York employers who pay their non-exempt, hourly employees on a bi-weekly or semi-monthly basis may need to think again based on recent court decisions interpreting the definition of “manual worker” under the New York Labor Law (“NYLL”). As explained in more detail below, the NYLL requires that employees who qualify as manual workers be paid on weekly basis; however, the types of workers who may be eligible for weekly pay is broader than one might think. New York employers who fail to properly classify their employees and issue payroll at the correct frequency may be risking significant liability, even if the wages were ultimately paid in full. This blog post will cover the definition of a manual worker, the pay-frequency requirements, and the possible consequences of non-compliance.
What is a manual worker?
The NYLL simply defines a “manual worker” as a “mechanic, workingman or laborer.” The New York Department of Labor (“NYDOL”) and New York courts have broadly interpreted this term to encompass any individuals who spend more than 25 percent of their working time engaged in “physical labor.” Neither the NYDOL nor the courts have clearly defined “physical labor”; instead, individual jobs are examined closely on a case-by-case basis. Employees found to be manual workers have included, for example, pizzeria workers, hairdressers, cashiers, and drivers who engage in lifting and carrying. Duties categorized as “physical labor” have included tasks such as preparing and packaging food items, lifting up to 25 pounds, cleaning workstations, operating equipment and standing for prolonged periods.
Employees who are definitely not manual workers include those that fall into other categories delineated by the NYLL, including railroad workers, commission salespeople, and “clerical and other” workers. “Clerical and other workers” is largely undefined; according to the statute, the term simply includes workers who are not manual workers, railroad workers, or commission salespeople. Therefore, the juxtaposition between this category and others is not exactly helpful.
The New York State Industrial Board (which reviews rules, regulations, and orders issued by the NYDOL), has issued at least one opinion that is helpful for employers. In a 2014 case, the Board suggested that highly-skilled workers do not fall into the category of manual workers. In Hudson Valley Mall Dental, PR 12-034 at 5-6 (N.Y. Indus. Bd. App. Aug. 17, 2014), the Board held that dental assistants were not manual workers because their jobs required “specialized training and attention.” On the other hand, manual labor was characterized as “a low skilled job that anyone walking into a job site can do.” Therefore, whether an employee is a “manual worker” under New York law may depend on the level of training and skill required to perform his or her job.
Still, recent federal cases emphasize that it is not easy for employers to resolve the “manual worker” issue on a motion to dismiss. For example, in Freeland v. Finlay’s Tall Timber Distribution Center, LLC, No. 22-CV-6415-FPG, 2023 WL 4457911 (W.D.N.Y. July 11, 2023), the district court held that a worker could survive a motion to dismiss by simply alleging that, for more than 25 percent of the time, he engaged in lifting and carrying up to fifty pounds, operating heavy machinery, breaking down ceramic parts by hand, and standing for long periods of time. At this stage of the case, it was not necessary for the worker to provide any greater detail about the alleged “physical labor” or time spent on these tasks. Similarly, in Rankine v. Levi Strauss & Co., No. 1:22-CV-03362-LTS, 2023 WL 3582323 (S.D.N.Y. May 22, 2023), a retail worker survived a motion to dismiss by alleging that he engaged in unpacking, stocking, organizing inventory, folding clothes, and tending to fitting rooms for more than 25 percent of the time. The court reasoned: “Factual questions as to whether Plaintiff can proffer evidentiary support for his assertions pertaining to the manual worker classification are properly examined at the summary judgment motion stage or at trial.” Id., at *6.
How often must manual workers be paid?
Manual workers must be paid weekly and not later than seven calendar days after the end of the week in which wages are earned. However, this rule does not apply to manual workers who are employed in bona fide executive, administrative, or professional capacities and earn more than $900 per week.
Private-sector employers are covered under this rule, but government employers and non-profitmaking organizations are not. Certain large employers may apply to the NYDOL for an exemption to the rule. To be eligible for consideration, the employer must have had either (a) an average of 1,000 or more employees in New York during the last three years, or (b) an average of 1,000 or more employees in New York during the last year and an average of 3,000 or more employees outside New York during the last three years.
What are the consequences of non-compliance?
In 2019, a New York court found that manual workers could sue their employers to enforce the state’s pay-frequency law. See Vega v. CM and Assoc. Constr. Mgt., LLC, 175 A.D.3d 1144 (1st Dep’t 2019). Since then, New York employers have been flooded with new pay-frequency lawsuits. This is largely because successful plaintiffs in these cases are entitled to liquidated damages in the amount of one hundred percent of their delayed wages, going back as far as six years. In other words, even though a worker was ultimately paid in full, he or she may still be entitled to liquidated damages in the amount of their late paychecks. For example, a manual worker who has been paid bi-weekly for six years could recover one week of pay for every pay period over the last six years – in other words, three years of pay. Importantly, liquidated damages can be reduced or eliminated if an employer can show that it acted in good faith.
What should employers do now?
Employers should work with legal counsel to ensure that any employees who may qualify as “manual workers” are properly classified and paid. In conducting this review, employers should examine the workers’ real day-to-day activities and not rely on their job descriptions. Since the category of “manual workers” is so ambiguously defined, and the potential consequences of non-compliance are so high, it is best to err on the side of over-inclusion. If an employee could reasonably be viewed as a “manual worker,” it may be best to treat them as such for the time being.
