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Corporate Liability For Wage And Hour Violations: Key Considerations

A man addressing a room full of businessmen.

The State of New York has what some consider to be the strictest wage and hour laws in the entirety of the United States. While this greatly benefits the general public and helps protect workers’ rights, it may also cause complications and confusion for business owners trying to understand wage and hour violations. Adhering to these laws can help a business flourish, but breaking them can have severe consequences, up to and including felony offenses and jail time.

An experienced employer defense and business litigation attorney from Schwab & Gasparini can help clarify the numerous points of wage and hour law in New York. Consider scheduling an appointment at the relevant office by calling (315) 422-1333 in Syracuse, (518) 591-4664 in Albany, (914) 304-4353 in White Plains, or (914) 304-4353 in Hudson Valley for more information.

Most Common Wage and Hour Violations

Wage and hour violations can be malicious and intended to harm employees, but more often than not they are accounting and clerical errors that can be easily remedied. These violations may be on the state level, or they may be federal wage and hour laws. Being aware of these various restrictions and laws can help employers continue to do business in a positive environment.

Unpaid or Withheld Wages

Neglecting to pay employees the wages they are owed, which is occasionally called wage theft, is unsurprisingly illegal in New York. Failure to provide proper payment to employees within thirty days of the expected date may be considered a misdemeanor, and the second offense within six years may be classified as a felony. The charges for these kinds of wage and hour violations can be severe.

Misclassifying Employees as Contractors

Another highly prevalent violation is the misclassification of employees. Different protections and requirements are held for employees and independent contractors, and therefore it is important to ensure that every worker is classified correctly.

If an employee is misclassified as a contractor, they may miss out on the benefits and protections that are owed to them. Over one million workers have been misclassified in New York from 2008 to 2022, and the lack of protection afforded to contract workers may lead to disputes and legal action.

Minimum Wage Disputes

According to the New York State Department of Labor, the minimum wage in New York ranges from $16 to $15 for hourly employees and $10.65 to $10 plus additional tip credit for tipped workers. By remaining aware of the most current minimum wage, employers can ensure there are no disputes or risks to the company’s reputation.

Employers may also note that the minimum wage does not stay fixed. As of January 1st, 2024, the minimum wage threshold increased statewide. In addition to that, rates may vary depending on the city, county, or metropolitan area the business operates out of. For example, New York City has a higher minimum wage than the rest of New York State.

Child Labor

In addition to monitoring for wage and hour violations, New York also has strict child labor guidelines. These guidelines may prohibit children from working entirely, limit the jobs available to minors, and otherwise provide protections and favorable working conditions for minors under eighteen years of age.

For more detailed information on the various wage and hour laws in New York, consider speaking with a skilled employer defense attorney from Schwab & Gasparini.

Most Common Overtime Violations

The Fair Labor Standards Act (FLSA) also includes provisions for overtime and paid leave. Employers who fail to provide these leave and overtime benefits may violate wage and hour standards and may therefore be subject to legal action. Most employees are entitled to 1.5 times their standard wage for any hours worked over 40 in a standard work week. However, listed below are several other violations that may be common in New York.

Family and Medical Leave Act (FMLA)

Employees are entitled to up to twelve weeks of unpaid leave in the event of a medical emergency, the birth or adoption of a child, or the care of an ailing family member. In addition, the law also requires that upon their return they are returned to their original position or one comparable to it.

New York State Paid Family Leave Act

Under certain circumstances, employees may be eligible for the benefits of the New York State Paid Family Leave Act. This is similar to FMLA, except that employees are entitled to pay while they are on leave. This may apply to new parents, family caregivers, and active-duty military families.

Consequences for Violation of Wage and Hour Laws

Each of these various wage and hour violations can harm the company by damaging morale, breaking trust with employees, and tarnishing the reputation of the business. However, there are also legal and monetary consequences that may be incurred if the offended party chooses to take legal action.

Repayment

If a business is found by the court to be in violation of wage and hour laws, it may be subject to repayment of damages. This may look like full compensation for wages missed or withheld, but it may include repaying beyond that for additional damages incurred. Depending on the offense, companies may need to pay fines of up to $20,000 or more.

Criminal Penalties

New York also classifies certain wage and hour violations as criminal violations, specifically if the owner or company is aware of or actively engaged in the violation. A first offense is generally considered a misdemeanor, which may be punishable by up to one year and one day in jail. This consequence may even extend to shareholders if the violation was intentional, and the courts may hold them personally liable.

Whistleblower Protection

New York also has several laws in place to protect those who report wage and hour violations to the relevant authorities. If a whistleblower is fired or otherwise penalized for drawing attention to a violation of the law, there may be additional consequences for the company responsible. These employees may also be entitled to lost pay, benefits, and seniority rights.

Corporate Responsibility for Wage and Hour Violations

Understanding these various wage and hour violations and the consequences of such, corporations may consider looking into the next steps to protect and promote effective wage and hour compliance strategies. By implementing proper recordkeeping protocols, internal audits, and a corporate culture of legal compliance, business owners can help protect their enterprises from legal action.

Contact a New York Employer Defense Attorney

Ensuring that businesses are consistently complying with wage and hour regulations can be a difficult challenge, especially when large companies and corporations are involved. However, promoting a culture of respect and integrity can help a business flourish and boost morale among employees. When it comes to the fine details of wage and hour violations, an experienced employer defense attorney from Schwab & Gasparini can help to advise protocol and protect against violations. Consider reaching out to the relevant office for a consultation by calling (315) 422-1333 in Syracuse, (518) 591-4664 in Albany, (914) 304-4353 in White Plains, or (914) 304-4353 in Hudson Valley for more information.

Sun Oct 6 2024, 12:00am