Bill Text: NY A11649 | 2009-2010 | General Assembly | Introduced
Bill Title: Relates to enforcement of wage payment laws; provides enhanced enforcement and penalty provision; permits private rights of action; defines independent contractor and permits action for improper classification of employees.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-07-06 - referred to labor [A11649 Detail]
Download: New_York-2009-A11649-Introduced.html
S T A T E O F N E W Y O R K
________________________________________________________________________
11649
I N A S S E M B L Y
July 6, 2010
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Ortiz) --
read once and referred to the Committee on Labor
AN ACT to amend the labor law, in relation to the payment of wages
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Subdivisions 2 and 3 of section 190 of the labor law,
2 subdivision 2 as added by chapter 548 of the laws of 1966 and subdivi-
3 sion 3 as amended by chapter 281 of the laws of 2002, are amended and
4 two new subdivisions 10 and 11 are added to read as follows:
5 2. "Employee" means [any person employed for hire by an employer in
6 any employment] A NATURAL PERSON WHO IS EMPLOYED IN THIS STATE BY AN
7 EMPLOYER, INCLUDING AN INDIVIDUAL WHO IS IN RECEIPT OF OR IS ENTITLED TO
8 ANY COMPENSATION FOR LABOR PERFORMED FOR ANY EMPLOYER. EMPLOYEE ALSO
9 INCLUDES A COMMISSION SALESPERSON WHO TAKES ORDERS OR PERFORMS SERVICES
10 ON BEHALF OF A PRINCIPAL AND WHO IS PAID ON THE BASIS OF COMMISSIONS,
11 BUT DOES NOT INCLUDE PERSONS WHO PURCHASE FOR THEIR OWN ACCOUNT FOR
12 RESALE.
13 3. "Employer" [includes any person, corporation, limited liability
14 company, or association employing any individual in any occupation,
15 industry, trade, business or service] MEANS A PERSON, FIRM OR CORPO-
16 RATION, AGENT, MANAGER, REPRESENTATIVE, CONTRACTOR, SUBCONTRACTOR OR
17 PRINCIPAL, OR OTHER PERSON ACTING DIRECTLY OR INDIRECTLY IN THE INTEREST
18 OF AN EMPLOYER TO SUFFER OR PERMIT ANOTHER PERSON TO WORK; WHETHER A
19 PERSON IS AN INDEPENDENT CONTRACTOR OR AN EMPLOYEE SHALL BE DETERMINED
20 ACCORDING TO THE STANDARDS OF THE FEDERAL FAIR LABOR STANDARDS ACT, 29
21 U.S.C. 201 TO 219, BUT THE BURDEN OF PROOF SHALL BE UPON THE PARTY FOR
22 WHOM THE WORK IS PERFORMED TO SHOW INDEPENDENT CONTRACTOR STATUS BY
23 CLEAR AND CONVINCING EVIDENCE. The term "employer" shall not include a
24 governmental agency.
25 10. "INDEPENDENT CONTRACTOR" MEANS A PERSON WHO:
26 (A) PERFORMS SERVICES FREE FROM DIRECTION AND CONTROL OVER THE MEANS
27 AND MANNER OF PROVIDING THE SERVICES, SUBJECT ONLY TO THE RIGHT OF THE
28 PERSON OR ENTITY FOR WHOM SERVICES ARE PROVIDED TO SPECIFY THE DESIRED
29 RESULT;
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD17744-01-0
A. 11649 2
1 (B) FURNISHES THE TOOLS AND EQUIPMENT NECESSARY TO PROVIDE THE
2 SERVICE;
3 (C) OPERATES A BUSINESS THAT IS CONSIDERED INSEPARABLE FROM THE INDI-
4 VIDUAL FOR PURPOSES OF TAXES, PROFITS, AND LIABILITIES:
5 (I) IN WHICH THE INDIVIDUAL:
6 (A) OWNS ALL OF THE ASSETS AND PROFITS OF THE BUSINESS; AND
7 (B) HAS SOLE, UNLIMITED, PERSONAL LIABILITY FOR ALL OF THE DEBTS AND
8 LIABILITIES OF THE BUSINESS, UNLESS THE BUSINESS IS ORGANIZED AS A
9 SINGLE-OWNED CORPORATE ENTITY, TO WHICH SOLE, UNLIMITED PERSONAL LIABIL-
10 ITY DOES NOT APPLY; AND
11 (II) FOR WHICH:
12 (A) THE INDIVIDUAL DOES NOT PAY TAXES FOR THE BUSINESS SEPARATELY BUT
13 REPORTS BUSINESS INCOME AND LOSSES ON THE INDIVIDUAL'S PERSONAL TAX
14 RETURN; AND
15 (B) IF THE BUSINESS IS ORGANIZED AS A CORPORATE ENTITY AND THE INDI-
16 VIDUAL OTHERWISE QUALIFIES AS AN EXEMPT PERSON UNDER THIS ARTICLE, THE
17 INDIVIDUAL FILES A SEPARATE FEDERAL INFORMATIONAL TAX RETURN FOR THE
18 ENTITY AS REQUIRED BY LAW;
19 (D) EXERCISES COMPLETE CONTROL OVER THE MANAGEMENT AND OPERATIONS OF
20 THE BUSINESS; AND
21 (E) EXERCISES THE RIGHT AND OPPORTUNITY ON A CONTINUING BASIS TO
22 PERFORM THE SERVICES OF THE BUSINESS FOR MULTIPLE ENTITIES AT THE INDI-
23 VIDUAL'S SOLE CHOICE AND DISCRETION.
24 11. "LIQUIDATED DAMAGES" MEANS THE SUM OF FIVE PERCENT MULTIPLIED BY
25 THE AMOUNT OF ANY WAGES THAT WERE NOT PAID OR OF ANY AUTHORIZED EXPENSES
26 THAT WERE NOT REIMBURSED ON A REGULAR PAYDAY OR ON ANOTHER DAY, MULTI-
27 PLIED BY THE TOTAL NUMBER OF DAYS, EXCLUDING SUNDAYS, LEGAL HOLIDAYS,
28 AND THE FIRST SEVEN DAYS AFTER THE REGULAR PAYDAY ON WHICH WAGES WERE
29 NOT PAID OR EXPENSES WERE NOT REIMBURSED. HOWEVER, SUCH SUM SHALL NOT
30 EXCEED TWICE THE AMOUNT OF THE UNPAID WAGES AND SHALL NOT ACCUMULATE
31 WHEN AN EMPLOYER IS SUBJECT TO A PETITION FILED IN BANKRUPTCY.
32 S 2. Section 198-a of the labor law is amended by adding a new subdi-
33 vision 4 to read as follows:
34 4. ANY WEEK WHERE AN INDIVIDUAL EMPLOYEE WAS NOT PAID THE LEGALLY
35 REQUIRED WAGES UNDER THIS ARTICLE, STATE TAXES WERE NOT WITHHELD, OR IN
36 THE CASE OF RETALIATION AGAINST AN EMPLOYEE, EVERY WEEK AFTER RETALI-
37 ATION HAS OCCURRED UNTIL COMPENSATION IS FINALLY MADE, SHALL CONSTITUTE
38 A SEPARATE VIOLATION OF THE PROVISIONS OF THIS ARTICLE.
39 S 3. Section 195 of the labor law is amended by adding a new subdivi-
40 sion 7 to read as follows:
41 7. ON EACH REGULAR PAYDAY, SEND TO EACH EMPLOYEE BY MAIL OR PROVIDE AT
42 THE EMPLOYEE'S NORMAL PLACE OF EMPLOYMENT DURING NORMAL EMPLOYMENT HOURS
43 A STATEMENT SHOWING THE HOURS THE EMPLOYEE WORKED, THE WAGES EARNED BY
44 THE EMPLOYEE, AND DEDUCTIONS MADE FOR THE EMPLOYEE.
45 S 4. Subdivision 1-a of section 198 of the labor law, as amended by
46 chapter 372 of the laws of 2009, is amended to read as follows:
47 1-a. On behalf of any employee paid less than the wage to which he or
48 she is entitled under the provisions of this article, the commissioner
49 may bring any legal action necessary, including administrative action,
50 to collect such claim and as part of such legal action, in addition to
51 any other remedies and penalties otherwise available under this article,
52 the commissioner may assess against the employer an additional amount as
53 liquidated damages [equal to twenty-five percent of the total amount of
54 wages found to be due] AS DEFINED IN SECTION ONE HUNDRED NINETY OF THIS
55 ARTICLE, unless the employer proves a good faith basis for believing
56 that its underpayment of wages was in compliance with the law. In any
A. 11649 3
1 action instituted in the courts upon a wage claim by an employee or the
2 commissioner in which the employee prevails, the court shall allow such
3 employee reasonable attorney's fees and, unless the employer proves a
4 good faith basis to believe that its underpayment of wages was in
5 compliance with the law, an additional amount as liquidated damages
6 [equal to twenty-five percent of the total amount of the wages found to
7 be due] AS DEFINED IN SECTION ONE HUNDRED NINETY OF THIS ARTICLE.
8 S 5. The labor law is amended by adding a new section 191-d to read as
9 follows:
10 S 191-D. PRIVATE RIGHT OF ACTION BY MISCLASSIFIED EMPLOYEES. 1.
11 NOTWITHSTANDING ANY REMEDY AVAILABLE UNDER THIS ARTICLE, AN INDIVIDUAL
12 WHO HAS NOT BEEN PROPERLY CLASSIFIED AS AN EMPLOYEE MAY BRING A CIVIL
13 ACTION FOR DAMAGES AGAINST THE EMPLOYER FOR ANY VIOLATION OF THIS ARTI-
14 CLE.
15 2. AN ACTION FILED UNDER THIS SECTION SHALL BE FILED WITHIN THREE
16 YEARS AFTER THE DATE THE CAUSE OF ACTION ACCRUES.
17 3. IF THE COURT DETERMINES THAT AN INDIVIDUAL OR CLASS OF INDIVIDUALS
18 IS ENTITLED TO JUDGMENT IN AN ACTION AGAINST AN EMPLOYER FILED IN
19 ACCORDANCE WITH THIS SECTION, THE COURT MAY AWARD EACH INDIVIDUAL:
20 (A) ANY DAMAGES TO WHICH THE INDIVIDUAL MAY BE ENTITLED UNDER THIS
21 ARTICLE;
22 (B) AN ADDITIONAL AMOUNT UP TO THREE TIMES THE AMOUNT OF ANY SUCH
23 DAMAGES, IF THE EMPLOYER KNOWINGLY FAILED TO PROPERLY CLASSIFY THE INDI-
24 VIDUAL;
25 (C) REASONABLE COUNSEL FEES AND OTHER COSTS OF THE ACTION; AND
26 (D) ANY OTHER APPROPRIATE RELIEF.
27 S 6. Subdivision 2 of section 196 of the labor law, as added by chap-
28 ter 548 of the laws of 1966, is amended to read as follows:
29 2. THE COMMISSIONER MAY HOLD HEARINGS AND INVESTIGATE CHARGES OF
30 VIOLATIONS OF THIS ARTICLE.
31 3. THE COMMISSIONER MAY, CONSISTENT WITH DUE PROCESS OF LAW, ENTER ANY
32 PLACE OF EMPLOYMENT TO INSPECT RECORDS CONCERNING WAGES AND PAYROLLS, TO
33 QUESTION THE EMPLOYER AND EMPLOYEES, AND TO INVESTIGATE SUCH FACTS,
34 CONDITIONS OR MATTERS AS ARE DEEMED APPROPRIATE IN DETERMINING WHETHER
35 ANY PERSON HAS VIOLATED THE PROVISIONS OF THIS ARTICLE. THE NAME OF ANY
36 EMPLOYEE IDENTIFIED IN A COMPLAINT TO THE DEPARTMENT SHALL BE KEPT
37 CONFIDENTIAL AS LONG AS POSSIBLE. WHERE THE DEPARTMENT DETERMINES THAT
38 AN EMPLOYEE'S NAME MUST BE DISCLOSED IN ORDER TO INVESTIGATE A COMPLAINT
39 FURTHER, IT MAY DO SO ONLY WITH THE EMPLOYEE'S CONSENT.
40 4. Nothing in this section shall be construed as requiring the commis-
41 sioner in every instance to investigate and attempt to adjust controver-
42 sies, or to take assignments of wage claims, or to institute criminal
43 prosecutions for any violation under this article, but he shall be
44 deemed vested with discretion in such matters.
45 S 7. The labor law is amended by adding a new section 196-b to read as
46 follows:
47 S 196-B. RETALIATION AGAINST EMPLOYEES PROHIBITED. NO PERSON OR
48 EMPLOYER SHALL DISCHARGE OR IN ANY OTHER MANNER DISCRIMINATE OR RETALI-
49 ATE AGAINST AN EMPLOYEE OR OTHER PERSON FOR EXERCISING ANY RIGHT UNDER
50 THIS ARTICLE OR ANY REGULATION IMPLEMENTING ITS PROVISIONS, OR AGAINST
51 ANY PERSON FOR PROVIDING ASSISTANCE TO ANY EMPLOYEE OR INFORMATION
52 REGARDING THE SAME, OR FOR TESTIFYING OR PLANNING TO TESTIFY IN ANY
53 INVESTIGATION OR PROCEEDING REGARDING THE SAME. TAKING ADVERSE ACTION
54 AGAINST A PERSON WITHIN NINETY DAYS OF A PERSON'S ENGAGING IN THE FORE-
55 GOING ACTIVITIES SHALL RAISE A PRESUMPTION THAT SUCH ACTION WAS RETALI-
56 ATION, WHICH MAY BE REBUTTED BY CLEAN AND CONVINCING EVIDENCE THAT SUCH
A. 11649 4
1 ACTION WAS TAKEN FOR OTHER PERMISSIBLE REASONS. ANY EMPLOYEE MAY FILE A
2 COMPLAINT WITH THE COMMISSIONER ALLEGING DISCHARGE OR DISCRIMINATION
3 WITHIN THIRTY DAYS AFTER SUCH VIOLATION OCCURS. UPON RECEIPT OF THE
4 COMPLAINT, THE COMMISSIONER SHALL CAUSE AN INVESTIGATION TO BE MADE TO
5 THE EXTENT DEEMED APPROPRIATE. IF THE COMMISSIONER DETERMINES FROM THE
6 INVESTIGATION THAT THE PROVISIONS OF THIS ARTICLE HAVE BEEN VIOLATED,
7 THE COMMISSIONER SHALL BRING AN ACTION IN A COURT OF COMPETENT JURISDIC-
8 TION AGAINST SUCH PERSON. SUCH COURT SHALL ORDER ALL APPROPRIATE RELIEF
9 INCLUDING REHIRING OR REINSTATEMENT OF THE EMPLOYEE TO THE FORMER POSI-
10 TION WITH BACK PAY. A CIVIL ACTION TO ENFORCE THIS ARTICLE MAY ALSO BE
11 MAINTAINED IN ANY COURT OF COMPETENT JURISDICTION BY THE STATE OR BY ANY
12 PARTY INURED BY A VIOLATION OF THIS ARTICLE. ANY EMPLOYER WHO RETALIATES
13 AGAINST AN EMPLOYEE OR OTHER PERSON IN VIOLATION OF THIS ARTICLE SHALL
14 BE REQUIRED TO PAY THE PERSON AN AMOUNT SET BY THE DEPARTMENT OR A COURT
15 SUFFICIENT TO COMPENSATE THE EMPLOYEE AND DETER FUTURE VIOLATIONS, BUT
16 NOT LESS THAN ONE HUNDRED DOLLARS FOR EACH DAY THAT THE VIOLATIONS
17 CONTINUED, OR UNTIL LEGAL JUDGMENT IS FINAL.
18 S 8. Subdivision 1 of section 198-a of the labor law, as amended by
19 chapter 241 of the laws of 2002, is amended to read as follows:
20 1. Every employer who does not pay the wages of all of his employees
21 in accordance with the provisions of this chapter, and the officers and
22 agents of any corporation [who knowingly permit the corporation to
23 violate] WHICH VIOLATES this chapter by failing to pay the wages of any
24 of its employees in accordance with the provisions thereof, shall be
25 guilty of a misdemeanor for the first offense and upon conviction there-
26 for shall be fined not less than five hundred nor more than twenty thou-
27 sand dollars or imprisoned for not more than one year, and, in the event
28 that any second or subsequent offense occurs within six years of the
29 date of conviction for a prior offense, shall be guilty of a felony for
30 the second or subsequent offense, and upon conviction therefor, shall be
31 fined not less than five hundred nor more than twenty thousand dollars
32 or imprisoned for not more than one year plus one day, or punished by
33 both such fine and imprisonment, for each such offense. ADDITIONALLY,
34 THE TEN LARGEST SHAREHOLDERS, AS DETERMINED BY THE FAIR VALUE OF THEIR
35 BENEFICIAL INTEREST AS OF THE BEGINNING OF THE PERIOD DURING WHICH THE
36 UNPAID SERVICES REFERRED TO IN THIS ARTICLE ARE PERFORMED, OF EVERY
37 CORPORATION (OTHER THAN AN INVESTMENT COMPANY REGISTERED AS SUCH UNDER
38 AN ACT OF CONGRESS ENTITLED "INVESTMENT COMPANY ACT OF 1940"), NO SHARES
39 OF WHICH ARE LISTED ON A NATIONAL SECURITIES EXCHANGE OR REGULARLY QUOT-
40 ED IN AN OVER-THE-COUNTER MARKET BY ONE OR MORE MEMBERS OF A NATIONAL OR
41 AN AFFILIATED SECURITIES ASSOCIATION, SHALL JOINTLY AND SEVERALLY BE
42 PERSONALLY LIABLE FOR ALL DEBTS, WAGES OR SALARIES DUE AND OWING TO ANY
43 OF ITS EMPLOYEES FOR SERVICES PERFORMED BY THEM FOR SUCH CORPORATION. A
44 CIVIL ACTION MAY BE BROUGHT AGAINST A SHAREHOLDER LIABLE FOR WAGES DUE
45 UNDER THIS CHAPTER INSTEAD OF AND IN ADDITION TO THE EMPLOYER. An
46 indictment of a person or corporation operating a steam surface railroad
47 for an offense specified in this section may be found and tried in any
48 county within the state in which such railroad ran at the time of such
49 offense.
50 S 9. The labor law is amended by adding a new section 191-e to read as
51 follows:
52 S 191-E. PRIVATE ATTORNEYS GENERAL PROVISION FOR ENFORCEMENT. 1. (A)
53 NOTWITHSTANDING ANY OTHER PROVISION OF LAW, ANY PROVISION OF THIS ARTI-
54 CLE THAT PROVIDES FOR A CIVIL PENALTY TO BE ASSESSED AND COLLECTED BY
55 THE COMMISSIONER MAY, AS AN ALTERNATIVE, BE RECOVERED THROUGH A CIVIL
A. 11649 5
1 ACTION BROUGHT BY AN AGGRIEVED EMPLOYEE ON BEHALF OF HIMSELF OR HERSELF
2 AND OTHER CURRENT OR FORMER EMPLOYEES.
3 (B) NO ACTION MAY BE BROUGHT UNDER THIS SECTION BY AN AGGRIEVED
4 EMPLOYEE IF THE COMMISSIONER ON THE SAME FACTS AND THEORIES, CITES A
5 PERSON WITHIN THE TIMEFRAMES SET FORTH IN THIS ARTICLE FOR A VIOLATION
6 OF THE SAME SECTION OR SECTIONS OF LAW UNDER WHICH THE AGGRIEVED EMPLOY-
7 EE IS ATTEMPTING TO RECOVER A CIVIL PENALTY ON BEHALF OF HIMSELF OR
8 HERSELF OR OTHERS.
9 (C) CIVIL PENALTIES RECOVERED BY AGGRIEVED EMPLOYEES SHALL BE DISTRIB-
10 UTED AS FOLLOWS: SEVENTY-FIVE PERCENT TO THE COMMISSION FOR ENFORCEMENT
11 OF LABOR LAWS AND EDUCATION OF EMPLOYERS AND EMPLOYEES ABOUT THEIR
12 RIGHTS AND RESPONSIBILITIES UNDER THIS ARTICLE, TO BE CONTINUOUSLY
13 APPROPRIATED TO SUPPLEMENT AND NOT SUPPLANT THE FUNDING TO THE AGENCY
14 FOR THOSE PURPOSES; AND TWENTY-FIVE PERCENT TO THE AGGRIEVED EMPLOYEES.
15 (D) COURTS SHALL REVIEW AND APPROVE ANY PENALTIES SOUGHT AS PART OF A
16 PROPOSED SETTLEMENT AGREEMENT PURSUANT TO THIS SECTION.
17 2. (A) A CIVIL ACTION BY AN AGGRIEVED EMPLOYEE SEEKING CIVIL PENALTIES
18 PURSUANT TO THIS SECTION ALLEGING A VIOLATION OF ANY PROVISION SHALL
19 COMMENCE ONLY AFTER THE FOLLOWING REQUIREMENTS HAVE BEEN MET:
20 (I) THE AGGRIEVED EMPLOYEE OR REPRESENTATIVE SHALL GIVE WRITTEN NOTICE
21 BY CERTIFIED MAIL TO THE DEPARTMENT AND THE EMPLOYER OF THE SPECIFIC
22 PROVISIONS OF THIS ARTICLE ALLEGED TO HAVE BEEN VIOLATED, INCLUDING THE
23 FACTS AND THEORIES TO SUPPORT THE ALLEGED VIOLATION.
24 (II) (A) THE DEPARTMENT SHALL NOTIFY THE EMPLOYER AND THE AGGRIEVED
25 EMPLOYEE OR REPRESENTATIVE BY CERTIFIED MAIL THAT IT DOES NOT INTEND TO
26 INVESTIGATE THE ALLEGED VIOLATION WITHIN THIRTY CALENDAR DAYS OF THE
27 POSTMARK DATE OF THE NOTICE RECEIVED PURSUANT TO SUBPARAGRAPH (I) OF
28 THIS PARAGRAPH. UPON RECEIPT OF THAT NOTICE OR IF NO NOTICE IS PROVIDED
29 WITHIN THIRTY-THREE CALENDAR DAYS OF THE POSTMARK DATE OF THE NOTICE
30 GIVEN PURSUANT TO SUCH SUBPARAGRAPH (I), THE AGGRIEVED EMPLOYEE MAY
31 COMMENCE A CIVIL ACTION.
32 (B) IF THE DEPARTMENT INTENDS TO INVESTIGATE THE ALLEGED VIOLATION, IT
33 SHALL NOTIFY THE EMPLOYER AND THE AGGRIEVED EMPLOYEE OR REPRESENTATIVE
34 BY CERTIFIED MAIL OF ITS DECISION WITHIN THIRTY-THREE CALENDAR DAYS OF
35 THE POSTMARK DATE OF THE NOTICE RECEIVED PURSUANT TO SUBPARAGRAPH (I) OF
36 THIS PARAGRAPH. WITHIN ONE HUNDRED TWENTY CALENDAR DAYS OF THAT DECI-
37 SION, THE AGENCY MAY INVESTIGATE THE ALLEGED VIOLATION AND ISSUE ANY
38 APPROPRIATE CITATION. IF THE AGENCY DETERMINES THAT NO CITATION WILL BE
39 ISSUED, IT SHALL NOTIFY THE EMPLOYER AND AGGRIEVED EMPLOYEE OF THAT
40 DECISION WITHIN FIVE BUSINESS DAYS THEREOF BY CERTIFIED MAIL. UPON
41 RECEIPT OF THAT NOTICE OR IF NO CITATION IS ISSUED BY THE AGENCY WITHIN
42 THE ONE HUNDRED FIFTY-EIGHT-DAY PERIOD PRESCRIBED BY THIS PARAGRAPH OR
43 IF THE AGENCY FAILS TO PROVIDE TIMELY OR ANY NOTIFICATION, THE AGGRIEVED
44 EMPLOYEE MAY COMMENCE A CIVIL ACTION.
45 (C) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, A PLAINTIFF MAY AS A
46 MATTER OF RIGHT AMEND AN EXISTING COMPLAINT TO ADD A CAUSE OF ACTION
47 ARISING UNDER THIS SECTION AT ANY TIME WITHIN SIXTY DAYS OF THE TIME
48 PERIODS SPECIFIED IN THIS SECTION.
49 S 10. This act shall take effect immediately.
