By Eve Cho Guillergan, Esq.
As the new year begins, New York State’s private-sector businesses, from restaurants to car washes and dry cleaners to law firms, have something important in common. They all must report wages paid to employees. The deadline for completion of the Annual Notice of Pay Rate form is February 1.
The Annual Notice of Pay Rate is part of the Wage Theft Prevention Act, which was passed in 2010 and went into effect on April 9, 2011. Among other things, the act serves to amend wage rate requirements and expand the civil and criminal penalties for noncompliance. The law is designed to prevent employers from failing to pay overtime, the minimum wage, and earned tips.
The Notice of Pay Rate form is a simple document that can be found on the New York State Department of Labor’s website at http://www.labor.ny.gov/workerprotection/laborstandards/employer/wage-theft-prevention-act.shtm. On the form, the employer is asked to provide basic information, including all “doing business as” names, street and mailing addresses, and telephone numbers. The employer also notes whether the wage rate was given at the time of hiring, on or before February 1, or prior to a change in pay. The employee’s wage rate, overtime pay, any wage allowances, how and the frequency with which pay is disseminated must be indicated. Employees are asked to sign the form and confirm that they have been notified of the pay rate, allowances, and the designated pay date. Employees also must indicate their primary language. Besides English, the form is currently available in Chinese, Creole, Haitian, Korean, Polish, Russian, and Spanish. The employer must provide the form in the appropriate language if it has been made available by the labor department in the worker’s primary language.
Employers are required to provide rate-of-pay notices as follows: at the time of hire, whenever there are changes to the pay notices, and each year via the Annual Notice of Pay Rate form. An employee cannot waive the notice requirement, and a notice may be included in letters and/or employment agreements provided to new hires. It may be given to an employee electronically, but the employee must acknowledge receipt and have the ability to print out the notice. If an employee refuses to sign the form, the employer should indicate this refusal directly on the notice itself.
The signed form must be retained by the employer for at least six years. If there is a change in the rate of pay, it’s sufficient that notification be given on the next Annual Notice of Pay Rate form. In most cases, a new notice is not required if the new rate is shown on the next payment of wages. However, employers in the hospitality industry must submit a new notice with each new wage rate change. All employees, including professionals, executives, and administrators, are required to sign an Annual Notice of Pay Rate form.
If proper notice is not provided, the Department of Labor can assess damages of $50 per employee per week. An employee can sue for damages on his or her own behalf, with the maximum restitution not to exceed $2,500.
The Business Council of New York State, Inc., urged the New York State Legislature to repeal the annual wage notification provision in testimony given to the Assembly Labor Committee during a hearing in Albany on November 21, 2013. In its testimony, the Business Council stated that the law had created at least $50 million, and perhaps more than $100 million, in additional compliance costs in a state with already substantial regulatory burdens and high state and local taxes. The council estimates that approximately 7.5 million private-sector employees are given notice of their pay rates in the state of New York.
Although the Annual Notice of Pay Rate form seems a simple document in terms of compliance, it’s important to take it seriously. As immigration attorneys with our own practices, we need to be organized and maintain our general business skills along with our legal acumen. Having one’s own practice can be the opportunity of a lifetime, and so it’s important to accurately follow even the most basic of labor laws.