Senate Bill S3642

                                 
BILL NUMBER: S3642

SPONSOR: MURRAY
 
TITLE OF BILL:

An act to amend the labor law, in relation to wage claims for manual
workers

 
PURPOSE:

This bill will clarify application of the labor law's wage theft
provisions to wage claims for manual workers.

 
SUMMARY OF PROVISIONS:

Section One amends subdivision 1-a of Section 198 of the labor law, to
clarify that its enforcement provisions and remedies, including private
right of action and payment of liquidated damages would only apply to
alleged violations of the weekly pay for manual workers mandate in Labor
Law § 191.1(a) if a worker's employer failed to make full payment of
wages within fourteen calendar days after the end of the week in which
the wages are earned, and had not been subject to a commissioner's order
              

pursuant to section 218 of the labor law directing compliance with Labor
Law § 191.

Section 2 provides the effective date

 
JUSTIFICATION:

This legislation addresses the unintended and unfair application of the
state's wage theft law to instances where "manual" workers received full
pay but were paid on a schedule other than weekly. The majority of
employees in New York are paid biweekly. However, New York Labor Law §
191 requires that any "manual worker" be paid "weekly and not later than
seven calendar days after the end of the week in which the wages are
earned," and while Labor Law § 190 defines "manual worker" - using
outdated and undefined terms - to mean "a mechanic, workingman or labor-
er," there is no further statutory or regulatory definition to clarify
the application of this unique weekly pay mandate.

The Department of Labor's FAQ guidance document on pay mandates only
says that it interprets "manual worker" to apply to any worker who
spends more than 25% of working time engaged in "physical labor," and
that "physical labor" includes "countless" physical tasks performed by
employees. Further, NYS DOL field auditors have provided employers with
inconsistent determinations as to what occupations meet this statutory
definition of "manual worker."

As result of these vague terms and open-ended guidance, employers may be
in violation of the Labor Law's weekly pay mandate for manual workers,
even though such workers received full pay on a biweekly basis. Such
actions would have constituted a simple Labor Law violation until 2019,
when the First Department's decision in Vega v.  CM & Assocs. Constr.
Mgmt., LLC, 175 A.D.3d 1144 (1st Dep't 2019), misapplied the wage theft
provisions of Labor Law § 198 and determined that manual workers who are
paid in full every two weeks are entitled to seek, as liquidated
damages, an extra payment equal to half of all wages they had already
been paid for up to six full years.  This outcome is exposing employers
to significant - in some cases, multi-million dollar -- damage claims in
cases where employers used the biweekly pay cycle, but also where
employees received full payment of wages, as per their mutually agreed
upon pay schedule with their employer. Since Vega was decided, more than
200 claims have been filed, often aimed at small, independent busi-
nesses.

This legislation modifies Labor Law § 198 to limit its application to
"weekly pay" violations to cases where an employer failed to make full
payment of wages on the Labor Law's generally applicable semi-monthly
pay frequency mandate, and the employer had previously been put on
notice by the Labor Department through a forma order that they are
subject to the weekly pay mandate.

 
LEGISLATIVE HISTORY:

2024: S6077 - Referred to Labor

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act will take effect immediately.