Wage‐Hour UpdateSusan Schultz Laluk, Esq.

Scott P. Rogoff, Esq.

January 10, 2014

Agenda

• Permissible Wage Deductions (New NYSRegulations)

• Meal Periods and Breaks• Travel Time• Gap Time• Training Time• Unpaid Interns• Hiring Minors

NY Labor Law §193

Law amended effective September 2012.Regulations effective October 9, 2013.• Deductions pursuant to law (e.g. taxes,

FICA, garnishments etc.) still permissible.• Expands permissible deductions and

enumerates impermissible deductions.• Rules for recovering overpayments.• Rules for repaying wage advances.

Is It a Permissible Deduction?• Insurance premiums?

Is It a Permissible Deduction?• Employee purchase of tools, equipment, and

clothing required for work?

Is It a Permissible Deduction?

• Health club or gym memberships?

Is It a Permissible Deduction?• Charitable contributions?

Is It a Permissible Deduction?• Repayment of employer losses such as

spoilage, breakage, cash shortages, caused by employee?

• Example: employee breaks a tool or steals from the cash drawer.

Is It a Permissible Deduction?• Cafeteria and vending machine purchases?

Is It a Permissible Deduction?

– Day care expenses?

Is It a Permissible Deduction?• Recoupment of unauthorized expenses?• Example: Employee uses a company credit card

on his personal vacation to pay for meals and entertainment.

Is It a Permissible Deduction?• Fines for tardiness, misconduct, or quitting

without notice?• Example: charging a $25 penalty for each day

an employee comes in late.

Other Acceptable Deductions

• Pension and savings benefits• Labor union dues• Transportation benefits• Food and lodging benefits• “Similar payments for the benefit of the

employee”

Other Prohibited Deductions• Contributions to political campaigns.• Fees, interest, or the administrative costs.

Permissible Deductions• Must be “for the benefit” of the employee, not

just convenience.• Must have employee’s written consent on file.

Permissible Wage Deductions

• Also may make wage deductions to recover an overpayment of wages due to clerical errors, and repayment of advances

Deductions for Inadvertent Overpayments

• Employee consent not required, but…

Deductions for Inadvertent Overpayments

• Employer must notify employee in writing in advance.– 3 days notice if less than or equal to next pay

period’s net wages– 3 weeks notice if greater than next pay period

net wages• Notice must include amounts and dates of

deductions, and procedure to contest.

Deductions for Inadvertent Overpayments

• Employee has right to contest within 7 days of notice (2 days if single deduction).

• Employer must respond within 7 days with its position and reason for position, and written invitation to meet with employee within 7 days to discuss.

• Employer must provide final written determination within 7 days of meeting.

Deductions for Inadvertent Overpayments

• No deductions permitted until 3 weeks after date of final determination.

• Improper deductions must be repaid either immediately or in the next payroll.

• Failure to implement and follow the required dispute resolution process causes all contested wage deductions to be deemed impermissible.

Deductions for Inadvertent Overpayments

• If amount less than or equal to net wages, can make single deduction.

• If greater than net wages, each deduction cannot be greater than 12.5% of gross wages, and not cause the employee’s hourly rate to fall below minimum wage.

Deductions for Inadvertent Overpayments

• Can only recoup overpayments made within 8 weeks prior to the date of notice to employee.

• Payback period is limited to six years from the date of the original overpayment.

• Separate transaction treated the same as a wage deduction.

Wage Advance Repayments• Employer and employee must agree in

writing prior to making the advance.• Must include notice to employee of right to

contest an improper deduction and dispute resolution procedure.

• Deductions suspended if employee contests until dispute has been resolved.

• Probably not possible to deduct advances against PTO/vacation/sick time without violating the regulations.

Rest Periods and Meal Periods• FLSA

– Rest periods of 20 minutes or less are compensable.

– Bona fide meal periods of 30 minutes or more are not compensable if employee is completely relieved from all duties.

• NYS Law– Rest periods not mandated

by law, but must comply with CBA and company policies.

Meal Periods

• New York State Labor Law• If employee works a 6 hour shift extending over the

lunch period (11 a.m.-2 p.m.), must be given a lunch break of at least 30 minutes.

• If employee works a shift beginning before 11 a.m. and continuing later than 7 p.m., must be given an additional 20 minute meal period between 5 and 7 p.m.

• If employee works a shift of more than 6 hours between 1 p.m. and 6 a.m., must be given a meal break of at least 30 minutes midway.

Meal Periods

• New York State Labor Law• One employee shift – if only one person in the job

function, and the employee volunteers, employee may eat on the job.

• Employee MUST be given a meal period if the employee requests it.

Travel Time

• Commuting time between home and usual workplace is not compensable

• Time traveling to another city for a one day assignment is compensable (employer may deduct normal commuting time)

• Time traveling from job site to job site during the work day is compensable

Travel Time - Overnight

• Travel time during normal working hours is compensable including corresponding hours on typical non-work days.

• For example, if an employee usually works 9 a.m.-5 p.m. M-F, and travels on Sunday from noon until 8 p.m., 5 hours (noon-5 p.m.) are compensable.

• Time actually worked while travelling is compensable.

“Gap” Time

Uncompensated time worked

• Breaks and meal periodsIf predominantly for employer’s benefit

“Gap” Time

Uncompensated time worked

• Time before and after shifts• If integral and indispensable to

performance of the job and not de minimis

“Gap” Time - TrainingTraining time, orientation, lectures, meetings, etc. unless:

Outside normal work hoursTruly voluntaryNot directly related to the employee's current jobNo work is performed during the training

Must meet all four criteria, or the employee must be paid.

“Gap” Time

• For example, an employee may work 39 hours in a week but be paid for only 35, in which case she has four hours of gap time.

• If she works 42 hours in a week but is paid for only 38, she has two hours of gap time (hours 39 and 40) and two hours of unpaid overtime (hours 41 and 42).

“Gap” Time

• Lundy v. Catholic Health System of Long Island, Inc. (2d Circuit, 2013)

• Three non-exempt employees were not paid for time worked during meal breaks, before and after scheduled shifts, and during required training sessions.

“Gap” Time

• FLSA requires payment of minimum wage and time and a half over 40 hours a week

• Court held if employee works under 40 hours a week, gap time claim is not actionable under the FLSA

• Employees may have a claim under state law for gap time

Unpaid Interns• Must meet all of the following factors:

– Similar to training in an educational environment.– Benefit the intern.– Intern does not displace regular employees, and

works under close supervision of existing staff.– Intern does not perform productive work that

benefits the employer.– Intern is not entitled to a job at the conclusion of

the internship and can take another job.– Writing acknowledging intern is not an employee

and not entitled to wages.

Unpaid Interns

• Clinical training under supervision of those knowledgeable in the field

• No employee benefits• Training is general and not designed

specifically for job with employer• Screening process different from

employment screening • Ads for internship discuss education and

training purpose, not employment

Unpaid Interns• The rules are not new, but the Dept. of Labor is cracking down.• Many interns are suing:

– Fox Searchlight Pictures: two unpaid production interns for the 2010 movie Black Swan had performed basic chores such as manning phones, fetching coffee, and taking out the trash. NY Federal District Court held they should be paid.

– Other claims against Conde Nast, Warner Music Group, Hearst, Donna Karan, others

Minors – Working Papers

• In NYS, anyone under 18 (minors) must show an employment certificate before they may begin work, including: – High school graduates– Minors who work for their parents– Minors who do industrial homework

• Employer must post scheduled hours of work each week for minor.

Minors – Working HoursAge Maximum Daily Hours Maximum 

Weekly HoursMaximum Days PerWeek

Permitted Hours

When school is in session

14‐15 3 hours school days8 hours other days

18 hours (23 if work‐study)

6 days 7 a.m.‐7 p.m.

16‐17 4 hours MTWTh (6 if coop)8 hours Fri., Sat., Sun. & Holidays

28 hours 6 days 6 a.m.‐10 p.m.Until midnight with written parental and school consent on day preceding a school day and until midnight on day preceding a non‐school day with written parental consent.

When school is not in session

14‐15 8 hours 40 hours 6 days 7 a.m.‐4 p.m.June 21‐Labor Day

16‐17 8 hours 48 hours 6 days 6 a.m.‐midnight

Not attending school

16‐17 8 hours 48 hours 6 days 6 a.m.‐midnight

Minors – Prohibited Work Under 18• Construction work including the painting or exterior cleaning• Operation of circular saws, band saws, and guillotine shears• In a slaughtering, meat-packing or rendering plant• Involving the operation of power-driven woodworking, metal-

forming, metal-punching, metal-shearing, bakery and paper products machines

• Involving the operation of power-driven hoisting apparatus• Involving the manufacture of brick, tile, and like products• Involving exposure to radioactive substances or ionizing

radiation, or exposure to silica or other harmful dust• Loggin occupations and occupations in the operation of any

sawmill• In mining or in connection with a mine or quarry

Minors – Prohibited Work Under 18• As a helper on a motor vehicle• In the care or operation of anelevator, except that minor over

16 may operate automatic, push-button control elevators• In manufacturing, packing, storing use or delivery of

explosives• Operating or using any abrasive polishing or buffing wheel,

where articles of the baser metals or iridium are manufactured• Adjusting belts to machinery or cleaning, oiling, or wiping

machinery• Packing paints, dry colors, or red or white leads• Preparing any composition in which dangerous or poisonous

acids are used• Operating steam boilers• In penal or correctional institutions, if the job relates to the

custody or care of prisoners or inmates

Not Applicable To:• Workers younger than 18 who are apprentices

individually registered in DOL registered apprenticeship programs

• Student-learners enrolled in recognized cooperative vocational training programs,

• Trainees in approved on-the-job training programs• Workers 16 or 17 years old who have completed training

as a student learner or trainee in an approved on-the-job training program

• Workers 16 or 17 years old who have completed a training program given by a public school or a non-profit institution that includes DOL approved safety instruction

Minors Prohibited Work Under 16

• Any factory work• Operating or assisting in operating any machinery unless all

moving parts other than keys, levers, or handles are so guarded as to prevent any part of the person or clothing for the operator from touching them

• Painting or exterior cleaning in connection with the maintenance of a building or structure

• Operating washing, grinding, cutting, slicing, pressing, or mixing machinery

• Work at institutions in the Department of Mental Health• Industrial homework• Places of entertainment as a rope or wirewalker or gymnast• Peddling; drug traffic; or any practice, exhibition, or place

dangerous or injurious to life, limb, or morals.• Dangerous farm jobs

Questions?

Sue Lalukslaluk@hblaw.com585‐295‐4461

Scott Rogoffsrogoff@hblaw.com

585‐295‐4418