On December 13, Governor Paterson signed the Wage Theft Prevention Act (WTPA), which takes effect April 12, 2011. It is important that employers familiarize themselves with the new law’s provisions prior to the effective date since the WTPA increases the record-keeping duties placed on employers and increases the penalties employers will have to pay for violations of the labor law.
Currently, NY Labor Law 195(1) requires employers inform all new hires in writing of their rate of pay, payday, and overtime rate. The WTPA requires that additional information be included on the written notice, such as the basis of the wage payment (i.e., by the hour, day, shift, week, salary, or commission) as well as whether any allowances will be claimed as part of the minimum wage (e.g., for tips, meals, or lodging). The notice must also provide any “doing business as” names for the organization.
Employers must provide new employees with the written notice at the time of hiring, and each year employers must provide an additional written notice reiterating the employee’s pay rate and other mandated information (and obtain a signed and dated acknowledgement of receipt from the employee) by February 1. The notice must be provided in both English and the language identified by the employee as his/her primary language, and employers must keep this notice for six years. The WTPA also increases the length of time an employer must maintain payroll records from three to six years.
The WTPA requires employers notify employees at least seven days before any change in the information contained in the notice takes effect unless that change is reflected on the employee’s pay stubs. Pay stubs must now include the following information: dates of work covered by the payment, employer name, address and telephone number, employee name, hours worked, rates paid and basis of the rate (e.g., hour, shift, day, week), gross wages, credits or allowances claimed (e.g., tips, meals), deductions and net wages. The WTPA calls for the Department of Labor to develop dual-language templates to assist employers in complying with the new law’s requirements. We will notify clients and colleagues of the firm once these templates have been posted on the New York State Department of Labor (NYSDOL)’s website.
Finally, the WTPA increases the civil and criminal penalties for violating certain labor law violations:
Employers should review their wage and hour practices to ensure compliance with the WTPA prior to April 12, 2011.