New York State Passes Wage Theft Prevention Act

By on December 15, 2010

The state of New York has passed a new law that will help protect employees from wage theft and labor abuses by employers.  On December 13, New York Governor David Paterson signed into law the Wage Theft Prevention Act, which will increase wage theft penalties, enhance protection for workers, and add resources to the state Department of Labor to help the agency investigate improprieties in the workforce and recover lost wages for affected employees.

Gov David Paterson

Gov David Paterson (AP Photo/Frank Franklin II)

The law was passed in the wake of a recent study by the National Employment Law Center that revealed widespread labor abuse of low-wage workers in New York City, including the denial of proper overtime pay and earnings that fell below the minimum wage threshold.  The study, “Broken Laws, Unprotected Workers,” surveyed 4,387 workers from New York City, Los Angeles, and Chicago and found that 68% of the survey respondents were denied proper overtime pay and that the average low-wage worker lost more than $2,600 in annual income as a result of the violations. Additionally, the study found only 8% of low-wage employees who suffered on the job injuries filed for workers compensation to pay for medical care and missed days, the New York Times reported.

The Wage Theft Prevention Act is designed to ensure employers pay statutorily-mandated minimum wages and overtime, and that appropriate enforcement actions, from monetary penalties to criminal prosecution, will be undertaken in circumstances where an employer does not comply with labor laws.

Some of the key aspects of the new law include:

  • Requiring employers to utilize in-depth and transparent record-keeping and employee notification procedures.
  • Raising the amount of wages that can be recovered as damages in a lawsuit for non-payment over and above the lost wages themselves from 25% to 100%.
  • Criminal penalties for failure to pay minimum wage will be up to a year in prison and a $5,000 fine.
  • Strengthens protections for whistleblowers in cases involving wage violations.

“At a time when so many New Yorkers are living paycheck to paycheck, it is vital that we protect the right to receive their hard-earned pay and afford them every protection against wage theft,” Governor Paterson said in a press release. “I am proud to sign this legislation, which will combat misconduct by unscrupulous employers who fail to pay statutorily-mandated minimum wages and overtime. I commend the bill’s sponsors, Senator Diane Savino and Assemblyman Carl Heastie, for their efforts in securing passage of this bill.”

See also: Employees Take Wage-and-Hour Complaints to Court

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