Understanding labor and overtime pay laws in New York is crucial for both employers and employees. These laws ensure fair compensation and protect workers’ rights. Here, we examine minimum wage regulations, overtime rules, and other essential aspects like tip-sharing and meal breaks to provide you with a clear, concise understanding of your rights and responsibilities under New York’s labor laws.

Minimum Wage Laws in New York

In New York, the minimum wage laws are designed to ensure that workers receive fair compensation for their labor. As of December 31, 2022, the minimum wage in New York City, Long Island, and Westchester is set at $15.00 per hour. This rate reflects the state’s commitment to supporting a living wage in areas with higher living costs. Meanwhile, in the rest of New York State, the minimum wage is slightly lower, standing at $14.20 per hour. 

Looking ahead, the state has planned further increases to the minimum wage. Starting January 1, 2024, the minimum wage in New York City, Nassau, Suffolk, and Westchester counties will rise to $16.00 per hour, aligning with the increasing cost of living in these regions. Simultaneously, the rest of the state will see an increase to $15.00 per hour. Additionally, recent amendments to the Labor Law stipulate a $0.50 increase per year on January 1, 2025, and January 1, 2026. These incremental raises are part of a broader effort to ensure wages keep pace with economic conditions, benefiting workers across New York.

Overtime Regulations

Overtime regulations in New York are a critical aspect of labor law, ensuring that workers are fairly compensated for extended work hours. According to these regulations, employees who work over 40 hours in a week are generally entitled to overtime pay. The overtime rate is one and a half times the employee’s regular rate of pay. This rule applies to most workers, with some specific exemptions based on job type and industry. Employees need to understand their eligibility for overtime pay, as it significantly impacts their earnings, especially in jobs with long hours or demanding schedules.

Overtime pay calculations can be complex. The regular rate of pay includes not just hourly wages, but may also encompass certain bonuses, commissions, and other incentive pay. For employees, being aware of how their overtime pay is computed is crucial to ensure they receive all wages owed to them. It’s a fundamental right under New York labor laws, aimed at protecting workers from being overworked and underpaid.

Tip-Sharing, Tip-Pooling, and Credit Card Charges

Tip-sharing and tip-pooling are common practices in service industries in New York, where tips significantly supplement employee earnings. Under these systems, tips are collected and distributed among a group of employees. Tip-sharing involves giving a portion of one’s tips to other staff members, like busboys or bartenders, who contribute to the service. Tip-pooling, on the other hand, involves pooling all tips received and then distributing them among the staff. Both practices are legal, but employers must adhere to strict guidelines to ensure fairness and compliance with labor laws.

Another important aspect related to tipping is the handling of credit card charges. When customers tip via credit card, employers are allowed to deduct a percentage of the tip to cover credit card processing fees. However, this deduction cannot reduce an employee’s wages below the required minimum wage. This policy ensures that the convenience of credit card tipping does not unduly burden the employees. 

Call-In, Reporting Pay, and Predictable Schedule

Call-in pay and reporting pay are integral parts of New York’s labor laws, providing essential protections for employees. When employees report for a scheduled shift but are either sent home early or find minimal work available, call-in and reporting pay regulations ensure they receive fair compensation for their time and effort. Usually, restaurant or hotel workers are entitled to three hours’ pay at the applicable minimum rate, and employees in other private workplaces are entitled to four hours’ pay at the applicable minimum rate. The law states: “An employee who… reports for work on any day shall be paid for at least four hours, or the number of hours in the regularly scheduled shift, whichever is less, at the basic minimum hourly wage.” This framework acknowledges the cost and inconvenience to employees who make themselves available for work, reinforcing the principle of fair labor practices.

The New York City Fair Workweek Law further strengthens employee rights, particularly in the fast food and retail sectors. This legislation includes predictable scheduling laws requiring employers to provide workers with stable and predictable work schedules. These laws mandate advance notice of work schedules and compensation for last-minute changes. Fast-food employers must provide work schedules at least 14 days in advance. If there are changes within this period, employees are entitled to additional compensation. This includes premiums for schedule changes made with less than 14 days’ notice and extra pay for last-minute cancellations or reductions in hours. The law also obliges employers to offer additional shifts to current employees before hiring new ones, ensuring existing workers have the chance to increase their work hours. 

In the retail industry, the Fair Workweek Law abolishes on-call scheduling, a practice that demands employees to be available without the certainty of work. This crucial change provides workers with more predictable and stable work hours, enhancing their financial stability and work-life balance. They are entitled to 72 hours advance notice of their work schedule and there can be no shift additions with less than 72 hours notice unless the employee consents. If an employer does not give an employee their schedule with the prescribed advanced notice, they may be required to pay the employee $300 and a possible $500 fine. These measures collectively advocate for fair and respectful labor practices. 

Clopening

New York City’s regulations on “clopening” shifts, particularly in the fast food sector, offer significant protections for employees. These shifts, where an employee closes the business and then reopens it the next morning with minimal rest, have been a point of contention due to their impact on workers’ health and well-being. The Fair Workweek Law in New York City mandates that employees cannot be required to work these consecutive shifts if the interval between them is less than 11 hours unless they voluntarily consent in writing. Furthermore, if an employee agrees to such shifts, they are entitled to a $100 premium as compensation. This law forms a part of broader efforts to ensure predictable scheduling and safeguard against wrongful termination, underscoring the importance of workers’ rights to adequate rest and a balanced work life.

Spread of Hours

The “spread of hours” law in New York is an important labor regulation, particularly relevant for hourly wage workers. This law stipulates that for any workday where the span of hours worked exceeds 10 hours, the employee is entitled to an extra hour of pay at the minimum wage rate. This rule applies regardless of whether the employee actually works those full 10 hours. It’s designed to compensate workers for long workdays that may include significant gaps or split shifts. Understanding this law is crucial for employees in industries with non-traditional or flexible scheduling, ensuring they are fairly compensated for extended work days.

Holidays, Vacation, and Sick Leave

In New York, while there are no state-mandated laws requiring private employers to provide paid holidays, vacation, or sick leave, many choose to offer these benefits as part of their employment package. This approach varies widely among employers, and it’s often influenced by industry standards, union agreements, and individual company policies. Employees are encouraged to review their employment contracts or consult with HR for specific details regarding their entitlements. In terms of sick leave, recent state legislation mandates certain employers to provide paid sick leave, offering crucial protection and support for workers during illness or family health emergencies.

Meal Breaks and Rest Periods

In New York, labor laws mandate specific meal breaks and rest periods for employees, ensuring necessary downtime during work hours. Employees working a shift of more than six hours, which extends over the noonday meal period, are entitled to at least a 30-minute lunch break. Additionally, those working a shift starting before 11 am and finishing after 7 pm are entitled to an additional 20-minute meal break. These meal breaks are typically unpaid unless the employer specifies otherwise. For shorter shifts, there are no statutory rest break requirements, but employers may offer them at their discretion. Understanding these regulations helps employees ensure they receive the breaks they are legally entitled to.

Pay Stubs, Pay Periods, and Deductions

In New York, pay stubs, pay periods, and deductions are regulated to ensure transparency and fairness in wage payments. Employers are required to provide employees with a detailed pay stub each pay period. This pay stub must include specifics such as the dates of the pay period, gross wages, deductions, and net wages. The clarity in pay stubs is crucial as it allows employees to understand exactly how their pay is calculated and to verify the accuracy of their wages. 

Regular pay periods are mandated by law, with the frequency varying based on the type of work and agreement with the employer, ensuring consistent and timely wage payments. Under New York state law, there’s a specific mandate for “manual workers” to receive their wages on a weekly basis. The New York Department of Labor classifies manual workers as those who spend at least 25% of their work time engaged in physical labor. This encompasses a wide range of physical tasks beyond heavy lifting, including activities like stocking shelves, unpacking boxes, cleaning, operating machinery, and organizing inventory. Importantly, the definition of manual workers is broad, covering roles such as customer service associates, stockers, hairdressers, and restaurant staff, underscoring the inclusive approach of New York labor law in protecting workers across various sectors.

Regarding deductions, the law is stringent about what can and cannot be deducted from an employee’s wages. Permissible deductions include taxes, social security, and benefits like health insurance, which the employee has agreed to. However, deductions for items like cash shortages, breakages, or required uniforms are typically not allowed. These regulations protect employees from unfair wage practices and ensure they receive the full compensation they legally earn. 

Statute of Limitations

In New York, the statute of limitations for filing a claim regarding labor law violations (including unpaid wages or overtime) is six (6) years. This means that employees have up to three years from the date of the alleged violation to initiate legal action against their employer. Workers must be aware of this timeframe, as claims filed beyond this period may not be considered.

Do You Have Questions About New York’s Labor Laws?

Gaining a thorough understanding of New York’s labor laws is essential to safeguard your rights and interests as an employee. We encourage you to delve deeper into these regulations to ensure you are fully informed. If you have any questions or need legal assistance, please don’t hesitate to contact the Lore Law Firm, where our experienced team is ready to provide you with professional guidance and support. Complete our free and confidential online client intake form to get started.

Frequently Asked Questions

How long does an unpaid overtime lawsuit in New York take?

After filing a lawsuit to recover unpaid overtime in NY, the amount of time that it takes to reach a resolution or settlement can vary based on a number of factors. Some cases resolve very quickly (within a few months) and other more complex cases can typically take 1-2 years or more. The vast majority of overtime cases filed in NY move through the process and reach a settlement prior to a trial.

How long do I have to bring a wage claim under New York labor law?

The statute of limitations for bringing a claim for unpaid overtime wages is 6 years under NY law.

What is considered overtime in the state of New York?

In New York, when an employee is not an “exempt” worker, every hour worked over 40 hours per week is considered overtime. Non-exempt employees must receive overtime pay at the rate of 1½ times their regular rate of pay for all hours worked over 40 in a workweek.

Which occupations are exempt from the overtime pay provisions of the NY State Labor Law?

  • Executive Employees
  • Administrative Employees
  • Professional Employees
  • Outside Salespeople
  • Individuals Working for a Federal, State, or Municipal Government
  • Farm Laborers
  • Certain Volunteers, Interns and Apprentices
  • Taxicab drivers
  • Members of Religious Orders
  • Certain Individuals Working for Religious or Charitable institutions
  • Camp Counselors
  • Individuals Working for a Fraternity, Sorority, Student or Faculty Association
  • Part-time Babysitters

If I work weekends or holidays in New York, will I receive overtime pay?

New York law does not require employers to pay employees extra for working on holidays or weekends unless there is an individual employment contract stating otherwise. The other exception would be if the time worked on the holiday or weekend requires the employee to work more than 40 hours that week.

What makes a worker an employee or an independent contractor in New York?

An independent contractor is considered to be a worker who is contracted to do a specific job or work without the control, direction or supervision of the company. If the employer has the right to control the work a person does, then they are likely an employee and not a contractor.

An employer-employee relationship likely exists if the hiring party:

  • Chooses when, where, and how the services are performed
  • Provides facilities, equipment, tools, and supplies
  • Directly supervises the services
  • Sets the hours of work
  • Sets the rate of pay
  • Requires attendance at meetings and/or training sessions
  • Requires prior permission for absences

If I take a meal break at work, am I paid for that time by my employer?

Your employer is not required to compensate you for time spent taking a lunch or meal break at work, so long as you are relieved of all duties during this time. If you are frequently interrupted during your lunch or meal break and called upon to do work, this should be counted as time worked and paid accordingly.

Can employees waive or sign away their right to receive overtime pay under NY law?

No. The right for non-exempt workers to receive overtime pay under NY labor law cannot be waived or given up by an employer and employee entering into an agreement. Any agreement that attempts to deny workers the right to overtime pay will be considered illegal and unenforceable under NY law.