Insights For New York’s Wage And Hour Maze

The Growth Of Wage And Hour Litigation

Litigation associated with employment law has grown recently. In my estimation, this is due to the increasingly worker-friendly and somewhat draconian nature of New York legislation. These conditions make it relatively easy for plaintiff attorneys to initiate lawsuits and attain successful outcomes. What's more, the excessively worker-friendly landscape in New York, in particular, magnifies this trend, as regular pay is not only recoverable but also subject to doubling as liquidated damages. Furthermore, if the claims are successful, employers are obliged to cover attorney's fees along with interest, creating an extremely compelling incentive for the plaintiff's lawyers to pursue such lawsuits.

Wage-Related New York Laws Employers Need To Be Aware Of

Employers in New York must navigate a complex web of nearly 40 statutes and sets of rules and regulations governing various aspects of the employer-employee relationship. From sick time policies to payment schedules, notification requirements, and record-keeping obligations, regulations span the spectrum, encompassing everything from minimum wage standards to overtime calculations.

Things get complicated very quickly. On paper, an employee may be entitled to their standard rate, let's say, $25 per hour. But, what many fail to recognize is that these other factors set in, such as nighttime differentials in relevant situations and additional monies for other various reasons. The regular rate for the week is then computed as the total hours worked in the first 40 hours divided by 40, resulting in a figure that exceeds what we said was their wage – $25 per hour – due to all the additions.

Overtime is thus calculated at one and a half times this 'regular rate.' It's not merely the negotiated rate of $25 per hour; it's the actual wage per hour over 40 hours multiplied by one and a half. This is just one example of the myriad of rules and regulations that often trip up employers unfamiliar with the nuances of compliance in New York.

Common Wage-Related Legal Issues In The Hospitality Industry

Everything related to these matters revolves around money. The most critical issue you need to be concerned with as an employer is maintaining accurate records of hours worked and diligently tracking tips. This helps ensure that employees receive their rightful earnings at the end of each week. Some personnel service providers might fail to get this down, either due to the fact that they're not based in New York or just because they lack a sufficient understanding of the rules and regulations they're subject to.

My advice to employers? Start from the ground up, navigating through the rules and regulations that apply to your workflow. This approach ensures your employees receive the correct amount in their pockets when they head home at the week's end.

This leads to a point worth mentioning: New York has introduced a frequency of payment rule. This rule applies to manual workers, including those in the hospitality industry and construction, mandating payment within seven days of service. Failure to adhere to this timeline is treated by the courts as the equivalent of non-payment.

Let me illustrate this a bit more for you. Consider a case where workers request monthly payments. Since the courts stipulate that the first three weeks of pay within that monthly cycle are deemed, in essence, equal to the entire period, the employer is on the hook to pay not only the owed amount but also penalties and interest. This seemingly inconsequential delay can quickly snowball into a substantial underpayment when manual workers aren't compensated within the stipulated seven days of service.

Common Mistakes New York Hospitality Industry Employers Make

Several common pitfalls often affect employers when attempting to address hour and wage-related disputes in the New York hospitality industry…

• Misunderstanding Overtime For Salaried Employees

One prevalent misconception is the belief that salaried employees are exempt from overtime pay. In reality, many salaried positions, particularly those in the hospitality industry labeled as managers or assistant managers, may not meet the specific criteria – both in terms of duties and salary amount – required to qualify for overtime exemption. It's crucial employers carefully assess each salaried role against these criteria to avoid inadvertent non-compliance.

• Incorrectly Classifying Employees As Independent Contractors

Another significant misstep is the misclassification of employees as independent contractors, a practice now subject to the Wage Theft Protection Act. This often occurs when employers assign specific tasks, such as deliveries, to individuals and designate them as independent contractors. This misclassification can lead to severe legal ramifications.

• Overlooking National Labor Relations Board (NLRB) Rules

For employers with a larger workforce, a commonly made oversight involves neglecting the impact of National Labor Relations Board rules. These rules, governing employee discipline, conduct, and concerted activities, extend beyond unionized settings to cover all employees. The National Labor Relations Act grants employees the right to engage in protected concerted activities, including discussions about wages, hours, and employment conditions. Employers who restrict such conversations may find themselves in deep disputes, especially considering the current proactive stance of the Biden administration in safeguarding employee rights, even in non-union environments.

How Long To Respond To Employee Claims Or Lawsuits

When it comes to responding to claims or lawsuits initiated by an employee in New York, the timeframe largely depends on where the claim is filed – whether it's before an administrative agency like the Department of Labor or in a court, be it federal or state.

The general rule of thumb is that an employer has 30 days to respond once served with a lawsuit. Meanwhile, if the claim is brought before the Department of Labor, the timelines may vary slightly, typically falling within the range of 30 to 45 days. However, even in the administrative context, prompt communication is essential. Employers must inform the Department of Labor about their intent to respond and may request additional time if needed. Despite potential variations, the overall process remains relatively swift. For more information on Wage Related Disputes In The NY Hospitality Industry, an initial consultation is your next best step.