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New York Wage Theft Prevention Act Update: State DOL Issues Model Forms and Guidance

Date: 4.4.2011

The Wage Theft Prevention Act, effective April 9, 2011, applies to all New York employers.  It modifies current new hire notification requirements that have been in effect since late 2009, imposes an annual notification requirement, and modifies the information required to be included on pay stubs.
 
The New York State Department of Labor has issued model notices in English and other languages, guidance for complying with the requirements of the new law, and instructions on how to use the DOL’s model forms.  These documents can be found on the DOL’s website, at http://www.labor.ny.gov/workerprotection/laborstandards/workprot/lshmpg.shtm.  Important takeaways are described below. (Please refer to our prior articles for further information on the enhanced pay stub requirements and the expanded penalties for wage and hour violations available under the statute, available at http://www.jacksonlewis.com/resources.php?NewsID=3501.)

  • While the DOL has issued various template notices, it specifically advises that their use is not mandatory.  However, any form utilized by a New York employer must contain all mandatory elements.
  • Employers are not required to identify the specific exemption that applies to an employee who has been classified as exempt.  The model form for exempt employees notes this is “optional.”
  • The DOL has issued notices in three foreign languages (available through the link above) — Chinese, Korean and Spanish — to allow employers to comply with the requirement that the notice be issued in an employee’s primary language.  If an employee has a primary language other than one used in a DOL-published notice, an employer is only required to use the English form.
  • Consistent with an opinion letter recently issued by the DOL, the annual notice requirement becomes applicable in 2012.   Prior to February 1st of each year, beginning with 2012, a notice must be provided even if the information contained in a prior notice has not changed.
  • The notice requirement cannot be waived and must be satisfied via a stand-alone document.  However, such document can be appended to an offer letter or employment agreement.
  • Notice can be provided electronically, as long as the employee can acknowledge receipt of the notice and print a copy.
  • Employers must retain copies of the notice for six years. 
  • Except the hospitality industry, for which the industry wage order requires notification of all pay changes, a formal pay change notice is not required, as long as the paystub shows the change.  However, the DOL advises that employers should inform employees in writing of all pay reductions.  
  • The DOL suggests that the employer simply attach a copy of any commission agreement to the notice rather than restating all commission formula on the notice.  New York law already requires any such commission agreements for salespersons to be signed by the employees and the employees retain a copy of such agreements.
  • No specific notice is required for bonus and incentive plans that provide for compensation on top of base wages, as long as the “employee was initially given a description or it is clearly shown on the wage statement for the period in which it is paid.” 
  • Failure to comply with the notice and pay stub requirements can lead to civil liability of up to $2,500 per employee for each type of violation. 
  • Retroactive wage increases need to be noted separately on pay stubs. 
  • Pay stubs can be provided electronically as long as employees can access and print the stub from a work computer.

As the effective date of the statute is fast approaching, all New York employers should: (i) ensure their pay stubs meet the enhanced statutory requirements; (ii) modify new hire notices to comply with the DOL’s requirements in both content and form (i.e., a stand-alone document); and (iii) prepare for the issuance of annual notices in January 2012.

Jackson Lewis attorneys are prepared to assist with compliance measures.

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