Wage Theft Protection Act

The Wage Theft Prevention Act is creating new recordkeeping obligations for employers and becomes effective on April 12, 2011.

Notice Obligations for New Hires
Currently, New York Labor Law Section 195(1) mandates that employers inform all new hires in writing of their regular rate of pay, pay day, and overtime rate, if applicable.  Employers must obtain a written acknowledgment from the new hire that this information was provided to them in writing.  Upon the Wage Theft Prevention Act’s April 12, 2011, effective date, the written notice must also include additional information, such as the method of payment, (hour, shift, day, week, salary, piece, or commission), as well as whether any allowances will be claimed as part of the minimum wage (tips, meals or lodging).  Employers will be required to furnish this information in both English and the employee’s primary language.

Annual Notice Obligations for All Employees
The new law also requires that employers provide all current employees with a notice annually, reiterating their pay rate and other mandated information and obtain a written acknowledgment that the notice was received before February 1st of each year.  Being that the law does not go into effect until April 12th of this year, the first time employers will be asked to do this is prior to February 1st of 2012.

Additional Notice Obligations
The new law also requires employers to provide a written notice at least seven days before any changes to the information contained in the employee’s most recent notice are implemented, unless the modifications are reflected in the employee’s wage statement.  Therefore, the wage statement must include the following information: dates of work covered by the payment, employee name, employer name, address and telephone number, hours worked, rates paid and basis thereof (e.g., hour, day, or week), gross wages, credits/allowances claimed (e.g., tips, meals and lodging), deductions, and net wages.

Recordkeeping Requirements
Remaining consistent with current requirements for payroll records, all required notices, statements, and acknowledgments must be maintained for six years.