NYSDOL issues guidance on the Wage Theft Prevention Act
The New York State Department of Labor (NYSDOL) has released additional information to assist employers with complying with the Wage Theft Prevention Act (WTPA) which goes into effect on Saturday, April 9, 2011.
The NYSDOL issued notification templates for the following groups of employees: (a) Hourly Rate Employees; (b) Multiple Hourly Rate Employees; (c) Employees Paid a Weekly Rate or a Salary for a Fixed Number of Hours (40 or Fewer in a Week); (d) Employees Paid a Salary for Varying Hours, Day Rate, Piece Rate, Flat Rate, or Other Non-Hourly Basis; (e) Prevailing Rate and Other Jobs; and (f) Exempt Employees. The templates are available here.
The NYSDOL also issued Guidelines for Written Notice of Rates of Pay and Regular Payday, as well as instructions related to the templates. While the Guidelines state that dual language templates are available in Chinese, Haitian-Creole, Korean, Polish, Russian, and Spanish, as of this writing, only the Chinese, Korean and Spanish templates are available. In order to comply with the requirement to provide a notice in the employee's primary language, the employer will have to ask each employee what his/her primary language is before the notice is provided. Due to non-discrimination concerns, employers should not obtain this information before an offer of employment is made. If the NYSDOL does not make a template in a particular language available, employers may provide notice to that employee in English only.
Lastly, the NYSDOL also issued "Frequently Asked Questions About the Wage Theft Prevention Act," which provides answers to many of the most common questions employers have about the WTPA.
Below is a summary of the information released by the NYSDOL.
Notices (New Hire and Annual)
The WTPA requires employers to provide wage notices at three points - upon hire, annually, and whenever a change occurs to information previously disclosed.
Annual notices must be provided between January 1 and February 1 with the first notice required before February 1, 2012 (e.g., sometime during January 2012). Although many employers implement annual rate changes in months other than January, the NYSDOL is requiring all employers to issue annual notices in January. The annual notice requirement CANNOT be satisfied by giving notice at some other point in the year (e.g., when annual increases are implemented).
Employers must issue annual notices even if there have been no changes.
Employers are NOT required to use the NYSDOL-issued templates and can develop their own, as long as the employer-prepared notices contain all the required information. Keep in mind however that the NYSDOL states that it "reserves the right to require use of NYSDOL forms in the future, if employer notices do not meet the requirements."
While the NYSDOL states that the new hire notice may be "included in" letters and/or employment agreements provided to new hires, it states the notice itself must "be on its own form or a stand-alone document." The document may be appended to an offer letter or employment agreement. This is a change from the previous new hire notice regulations as many employers had previously satisfied requirements by including the necessary information in new hire offer letters or employment agreements and did not use a separate form.
The NYSDOL is no longer requiring that notices issued to exempt employees specify the exemption that applies to the employee. The NYSDOL communicated that employers "may state the specific exemption that applies," but are not required to.
Notices may be given electronically but there must be a system for the employee to acknowledge receipt of the notice and print out a copy of the notice. Employers cannot rely on a passive receipt of an email (i.e. using the read/receipt function). The NYSDOL did not issue further guidance on what requirements a system must have in place in order to comply with the regulations.
If an employee refuses to sign the acknowledgment, the NYSDOL advises that "the employer should still give the notice and note the worker's refusal on its copy of the notice."
Notice of Changes
Except for hospitality industry employers, a separate notice is not required when there is an increase in an employee's pay rate, if the increase is reflected on the corresponding wage statement (i.e. pay stub).
For any reduction in pay rate, the employer must notify the employee in writing at least seven days before the change.
If an annual flat rate increase occurs mid-year, the employer will be obligated to provide a notice of that change. However, this notice requirement can be satisfied if the wage statement (i.e. pay stub) issued following the adjustment identifies the change.
Wage Statements (i.e. pay stubs)
For all employees the following information is required with every payment of wages:
· Name of employee
· Name of employer
· Employer's address and phone
· Rate or rates of pay
· Basis of rate of pay (hourly, shift, day, week, salary, piece, commission or other)
· Gross wages
· Deductions
· Allowances, if any are claimed as part of the minimum wage (tips, meals, lodging)
· Net wages
For non-exempt employees, the following additional information must be provided.
· Regular hourly rate or rates
· Overtime rate or rates
· Number of regular hours worked
· Number of overtime hours worked
If a retroactive wage increase is implemented, the amount of the retroactive increase must be separately noted on the wage statement (i.e. pay stub) in the period in which it is paid.
Wage statements (i.e. pay stubs) may be provided electronically, if employees can access and print their statements on a computer provided by the employer.
The NYSDOL will prepare a sample wage statement showing the types of entries which may be necessary, but has not communicated when this will be published.
Retaliation
Employees are protected from retaliation if they complain to their employer, the NYSDOL, or the Attorney General about a possible labor law violation.
If employees believe in good faith that "there is a problem in the workplace, their activities are protected," even if the employer has not actually violated the labor law.
Even threatening an employee can be considered retaliation.
Actions for Employers
The WTPA goes into effect on April 9, 2011. Employers may need to take the following actions:
1. Review the information released by the NYSDOL. The "Frequently Asked Questions About the Wage Theft Prevention Act," is informative and provides additional information about the WTPA;
2. Review payroll practices and ensure all information required to be furnished on the new hire/annual notices is available and included. The NYSDOL has issued templates for employers to use. The templates are available here;
3. Ensure Wage Statements (i.e. pay stubs) are furnished with each pay period and contain all required information. This will require that you contact your payroll company to ensure they have updated their wage notices to comply with the WTPA;
4. Put policies in place to ensure that all pay-change information is communicated in writing to employees at least seven days before the new pay practices are implemented (using the model notice or equivalent) or is reflected in the next Wage Statement (i.e. pay stub);
5. Due to the continued risk of "misclassification issues (i.e. incorrectly identifying an employee as exempt from overtime when they should be non-exempt from the overtime rules or classifying a worker as an independent contractor when they should be an employee), employers should audit their workforce and payroll practices;
6. Ensure that all hours worked by each non-exempt employee, including times of arrival and departure, are tracked and recorded;
7. Coordinate with outside payroll providers and internal payroll personnel to make sure records containing all required information are maintained for at least six years with other payroll records; and
8. Train supervisors and human resources personnel in the new requirements and their responsibilities under the WTPA.
