Most employers and employees do not question how often wages are paid. In New York, there is a palpable increase in litigation on this issue.
In 2019, the First Department of the New York State Appellate Division established a private right of action for employees to challenge their pay frequency under NYLL, leading to more claims from employees, such as retail sales workers and make-up artists.
New York Labor Law (“NYLL”) requires that employees who spend more than 25% of their working time performing physical labor be compensated on a weekly basis. Physical labor has been construed broadly to include, by way of example, chauffeurs who sometimes perform heavy lifting.
In several recent cases, Courts have denied employers’ requests for early dismissal of these cases prior to discovery. These cases will now proceed to discovery on the workers’ precise duties and whether such work can thus be considered manual labor. Employers should be mindful that the determination of who is a manual worker is a case-by-case analysis, and that it is possible that two individuals employed in the same title or location may perform slightly different tasks such that one will be considered a manual worker under the law while the other is not. Thus, even if a Court were ultimately to find that certain retail sales workers are not physical laborers, it would not preclude other retail sales workers from coming forward and asserting that more than a quarter of their work time consists of performing physical labor. In short, the issue remains in flux and employers paying hourly employees on a less-frequent basis than weekly continue to run the risk of an adverse determination, with fines and liquidated damages equal to the amount of all wages received later than on a weekly basis (up to a half years’ wages if the employee was paid bi-weekly) as the potential consequences thereof.
Employers can take proactive steps to avoid potential litigation and ensure compliance with NYLL by reviewing their pay practices and accurately classifying employees as manual or non-manual workers based on their specific job duties. Employers may also consider switching to a weekly pay frequency for employees who spend more than 25% of their work time performing physical labor to comply with NYLL requirements. It is important to maintain accurate records of employee work hours and pay frequency to defend against any potential claims.
The attorneys at Outside Legal Counsel LLP have significant experience with this issue and can provide guidance to those with questions.
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