S T A T E   O F   N E W   Y O R K
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                                   398

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                               (PREFILED)

                             January 7, 2009
                               ___________

Introduced  by  M. of A. JOHN -- read once and referred to the Committee
  on Labor

AN ACT to amend the labor law, in relation to moneys withheld for  bene-
  fit of laborers

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Paragraphs b, c, d and f of subdivision 2 of section  220-b
of the labor law, paragraphs b, c and f as amended by chapter 304 of the
laws  of  1989  and paragraph d as amended by chapter 547 of the laws of
1998, are amended to read as follows:
  b. Moneys withheld pursuant to this  section  shall  be  held  by  the
financial  officer  for  the  sole  and exclusive benefit of the workers
employed on said public improvement and for payment of any civil penalty
that may be assessed as provided herein and shall not be  used  for  any
other  purpose except upon court order  AND, ABSENT SUCH COURT ORDER, NO
PART OF THE MONEYS WITHHELD SHALL  BE  RELEASED  TO  THE  CONTRACTOR  OR
SUBCONTRACTOR  PRIOR  TO  FULL  RESTITUTION  BEING MADE TO SUCH WORKERS.
ADDITIONALLY, THE AMOUNT OF WAGES AND SUPPLEMENTS, INCLUDING INTEREST AT
THE RATE PROVIDED IN THIS ARTICLE,  FOUND  TO  BE  DUE  TO  THE  WORKERS
EMPLOYED ON SUCH PUBLIC IMPROVEMENT SHALL NOT BE REDUCED PURSUANT TO ANY
SETTLEMENT OR OTHER NEGOTIATION OF A WRITTEN COMPLAINT FILED PURSUANT TO
THIS  SECTION.  Any  person,  partnership,  association,  corporation or
governmental body who files a lien or commences  a  judicial  proceeding
with respect to any monies withheld pursuant to this section shall noti-
fy  the  fiscal officer in writing of the lien or claim on or before the
date of filing of the lien or commencement of the  judicial  proceeding.
In  any proceeding to obtain moneys withheld pursuant to this section by
any person, partnership, association, corporation or governmental  body,
the fiscal officer shall have the right to appear and be heard.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02541-02-9
              

A. 398                              2

  c.  The  fiscal  officer  shall  cause  an investigation to be made to
determine whether any amounts  are  due  to  the  laborers,  workmen  or
mechanics,  or on their respective behalves, on such public improvement,
for labor performed after the  commencement  of  the  three-year  period
immediately preceding the filing of the complaint or the commencement of
the  investigation  on his own initiative, as the case may be, and shall
order a hearing thereon at a time and place to be  specified  and  shall
give notice thereof, together with a copy of such complaint, or a state-
ment  of the facts disclosed upon such investigation, which notice shall
be served personally or by mail on all interested persons, including the
person complained against and upon the financial officer  of  the  civil
division interested; such person complained against shall have an oppor-
tunity  to be heard in respect to the matters complained of, at the time
and place specified in such notice, which time shall be  not  less  than
five days from the service of said notice. The fiscal officer in such an
investigation  shall  be  deemed to be acting in a judicial capacity and
shall have the rights to issue subpoenas, administer oaths  and  examine
witnesses. The enforcement of a subpoena issued under this section shall
be regulated by the civil practice law and rules. Such investigation and
hearing  shall  be  expeditiously  conducted,  and upon such hearing and
investigation, the fiscal officer  shall  determine  the  issues  raised
thereon  and  shall  make  and  file an order in his office stating such
determination  and  forthwith  serve  a  copy  of  such  order,   either
personally  or  by mail, together with notice of filing, upon the finan-
cial officer of the civil division interested, and the parties  to  such
proceedings and, if the fiscal officer be the comptroller or other anal-
ogous  officer of a city, upon the commissioner. Such order shall direct
payment of wages or supplements found to be due, including  interest  at
the  rate of interest then in effect as prescribed by the superintendent
of banks pursuant to section fourteen-a  of  the  banking  law,  AND  IN
COMPLIANCE  WITH  SUBDIVISION  FIVE  OF SUCH SECTION, per annum from the
date of the underpayment to the date  of  the  payment  TO  THE  WORKERS
EMPLOYED ON SUCH PUBLIC IMPROVEMENT.
  d.  In addition to directing payment of wages or supplements including
interest found to be due, the order of the  fiscal  officer  may  direct
payment  of  a further sum as a civil penalty in an amount not exceeding
twenty-five percent of the total amount found to be  due.  In  assessing
the  amount  of the CIVIL penalty ONLY, due consideration shall be given
to the size of the employer's business, the good faith of the  employer,
the  gravity of the violation, the history of previous violations of the
employer or any successor or substantially-owned  affiliated  entity  or
any  of the partners if the contractor or subcontractor is a partnership
or any of the five largest shareholders of the contractor or subcontrac-
tor, as determined by  the  fiscal  officer,  and  any  officer  of  the
contractor  or subcontractor who knowingly participated in the violation
of this article, and the failure to comply with recordkeeping  or  other
non-wage  requirements.  Upon  the fiscal officer's determination of the
penalty, where the fiscal officer is the commissioner, the penalty shall
be paid to the commissioner for deposit in the state treasury. Where the
fiscal officer is a city comptroller or  other  analogous  officer,  the
penalty shall be paid to said officer for deposit in the city treasury.
  f.  If the financial officer of the civil division interested fails to
pay to the claimant the amount of the claim as determined by the  fiscal
officer within ten days after the expiration of the contractor's time to
commence  a  proceeding  for review of the fiscal officer's order or, if
such a proceeding has been commenced, within ten days  after  entry  and

A. 398                              3

service  of  a  court  order  confirming the fiscal officer's order, the
civil division interested shall pay to  the  claimant  interest  on  the
claim at the rate of interest then in effect as prescribed by the super-
intendent  of  banks  pursuant to section fourteen-a of the banking law,
AND IN COMPLIANCE WITH SUBDIVISION FIVE OF SUCH SECTION, from  the  date
the  financial  officer was required to pay the claim as provided herein
to the date of payment; provided,  however,  this  paragraph  shall  not
apply  if  the  failure  of  the financial officer of the civil division
interested to pay the amount of the claim is pursuant to court order.
  S 2. This act shall take effect immediately.