Bill Text: NY S07791 | 2011-2012 | General Assembly | Introduced

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Bill Title: Requires notice from employers to customers of service charges and administrative fees that are not distributed to employees as gratuities.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2012-06-18 - REFERRED TO RULES [S07791 Detail]

Download: New_York-2011-S07791-Introduced.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         7791
                                   I N  S E N A T E
                                     June 18, 2012
                                      ___________
       Introduced  by  Sen. MARTINS -- read twice and ordered printed, and when
         printed to be committed to the Committee on Rules
       AN ACT to amend the labor law, in  relation  to  requiring  notice  from
         employers to customers of service charges and administration fees that
         are not distributed to employees as gratuities
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. Section 196-d of the labor law, as added by chapter 1007 of
    2  the laws of 1968, is amended to read as follows:
    3    S 196-d. Gratuities. 1. AN  EMPLOYER  SHALL  NOT  BE  PROHIBITED  FROM
    4  ADDING  A MANDATORY GRATUITY AS LONG AS: (A) THE CHARGE IS CONSPICUOUSLY
    5  DISCLOSED TO THE CUSTOMER BEFORE FOOD OR BEVERAGE IS ORDERED; AND (B) NO
    6  EMPLOYER OR HIS AGENT OR AN OFFICER OR AGENT OF ANY  CORPORATION,  SHALL
    7  RETAIN  ANY  PORTION OF SUCH GRATUITY. THE DISCLOSURE SHALL USE ORDINARY
    8  LANGUAGE READILY UNDERSTOOD AND SHALL APPEAR IN A TYPE SIZE  SIMILAR  TO
    9  SURROUNDING TEXT.
   10    2. No employer or his agent or an officer or agent of any corporation,
   11  or  any other person shall demand or accept, directly or indirectly, any
   12  part of the gratuities, received by an employee, or retain any part of a
   13  gratuity or of any charge purported to be a gratuity  for  an  employee.
   14  This  provision  shall not apply to the checking of hats, coats or other
   15  apparel. Nothing in this subdivision shall be construed as affecting the
   16  allowances from the minimum wage for gratuities in the amount determined
   17  in accordance with the provisions of article nineteen  of  this  chapter
   18  nor as affecting practices in connection with banquets and other special
   19  functions  where  a  fixed  percentage of the patron's bill is added for
   20  gratuities which are distributed to employees, nor  to  the  sharing  of
   21  tips  by  a  waiter with a busboy or similar employee.  AN EMPLOYER THAT
   22  IMPOSES A MANDATORY SERVICE CHARGE, ADMINISTRATIVE  FEE,  OR  ANY  OTHER
   23  SIMILAR  CHARGE WHICH IS NOT DISTRIBUTED TO EMPLOYEES AS GRATUITIES MUST
   24  PROVIDE WRITTEN NOTICE TO CUSTOMERS IN THE  CONTRACT  OR  AGREEMENT  FOR
   25  SERVICES  AND  ON THE CHECK OR INVOICE THAT THE CHARGE IS NOT A GRATUITY
   26  AND WILL NOT BE DISTRIBUTED TO EMPLOYEES WHO PROVIDED SERVICE TO GUESTS,
   27  OR IF ONLY A PORTION OF THE CHARGE IS  DISTRIBUTED  AS  GRATUITIES,  THE
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD14113-20-2
       S. 7791                             2
    1  PORTION  DISTRIBUTED  AS  GRATUITIES  MUST  BE IDENTIFIED.   THE WRITTEN
    2  NOTICE TO CUSTOMERS IN THE CONTRACT  OR  AGREEMENT  FOR  SERVICES  SHALL
    3  APPEAR  IN A TYPE SIZE NO SMALLER THAN TWELVE POINT TYPE. THE STATEMENTS
    4  IN  THE  CHECK OR INVOICE SHALL USE ORDINARY LANGUAGE READILY UNDERSTOOD
    5  AND SHALL APPEAR IN A TYPE SIZE SIMILAR TO SURROUNDING TEXT.
    6    3. NOTWITHSTANDING THE FOREGOING, THERE SHALL BE NO LIABILITY  TO  ANY
    7  ACTION  ALLEGING  THAT  ANY  SERVICE  CHARGE, ADMINISTRATIVE FEE, OR ANY
    8  OTHER SIMILAR CHARGE IMPOSED AS PART OF A BANQUET HELD PRIOR TO  JANUARY
    9  FIRST,  TWO THOUSAND ELEVEN WAS A GRATUITY, IF THE EMPLOYER PROVES AS AN
   10  AFFIRMATIVE DEFENSE THAT ALL OF THE FOLLOWING CONDITIONS WERE  MET:  (A)
   11  THE  EMPLOYER  OR  EMPLOYER'S  AGENT  DID NOT EXPRESSLY REPRESENT TO THE
   12  CUSTOMER THAT THE CHARGE WAS A GRATUITY; (B) THE EMPLOYER CHARGED  SALES
   13  TAX  IN  ACCORDANCE WITH THE APPLICABLE PROVISIONS OF THE TAX LAW ON THE
   14  CHARGE; (C) THE EMPLOYER INCLUDED  THE  CHARGE  AS  PART  OF  ITS  GROSS
   15  RECEIPTS,  UPON  WHICH  INCOME  TAX WAS CALCULATED; AND (D) THE EMPLOYER
   16  PAID FOOD SERVICE WORKERS WAGES SET FORTH IN SECTION SIX HUNDRED  FIFTY-
   17  TWO OF THIS CHAPTER.
   18    S 2. This act shall take effect immediately.