NYS Has New Wage Rules—with Corresponding Fines

By Richard J. Koreto

A state law affecting the vast majority of New York employers, the Wage Theft Prevention Act (WTPA), went into effect on April 2011. An essential deadline is around the corner on Feb. 1, and the state Labor Department will hit employers who violate the law with fines.

According to the department, WTPA "gives greater protection to workers, and makes changes in the way they are notified of their pay rates and receive wage statements." Existing rules already required employers to notify employees of their wage rates at the time of hire. WTPA has beefed up that requirement: employers must now give a written notice to each new hire and to all employees by Feb. 1 each year.

"This has not been well publicized at all by the Department of Labor, and I suspect most small employers (and their accountants) don't know about it," said Jeffrey S. Gold, vice chair of the NYSSCPA New York, Multistate & Local Taxation Committee. He emphasized that employers can be fined up to $50 per employee per week for failure to provide this notice.

Gold also noted that there are no employee exclusions to this rule. That is, employers have to provide the notice to professionals, executives, administrators and others exempt from state overtime requirements must still receive a notice. The new requirement also applies to workers covered by a union contract.

All private sector employers are covered, but employees who work in other states are not covered. Federal, state and local government employers are also not covered, but the Labor Department stresses that charter schools, private schools and not-for-profit corporations are covered, as they are not public entities.

What a "Notice" Means

The Department has stated that the notice to the employee must contain the following information:

• The employee’s rate(s) of pay.
• The basis of the employee’s rate(s) of pay (e.g. by the hour, shift, day, week, salary, piece, commission, or other).
• Whether the employer intends to claim allowances as part of the minimum wage, including tip, meal, or lodging allowances, and the amount of those allowances.
• The employee’s regular pay day designated by the employer in accordance with the frequency of pay requirements in the Labor Law.
• The name of the employer and any "doing business as" names used by the employer.
• The physical address of the employer's main office or principal place of business, and a mailing address if different.
• The telephone number of the employer.
• Any such other information as the commissioner deems material and necessary.

More information is available on the WTPA FAQ page. Also available for download are notice templates.