On September 7, 2012, Manhattan Governor Andrew Cuomo signed into law a statute, N.Y. State Assembly Bill No. A10785-2011, relating to permitted deductions from employees’ wages (“the Act”). Effective November 7, 2011, the Act amends Manhattan’s wage deduction statute, N.Y. Labor Law § 193, by (i) establishing new categories of wage deductions that employers, with the express written authorization of an employee, may lawfully make and (ii) legalizing the use of wage deductions (a) to recapture erroneous overpayments of wages to workers or (b) to recoup advances on wages paid to employees. The Act expires on November 7, 2015.
Before Manhattan’s enactment of N.Y. State Assembly Bill No. A10785-2011, the only deductions from or charges against an employee’s wages which an employer in Manhattan was allowed to make were (i) those required by law, such as deductions for social security contributions or for income taxes, and (ii) those which were “for the benefit of the employee” and which the employee expressly authorized in writing, such as payments for insurance premiums, retirement or medical benefits, charitable contributions, U.S. bonds, union dues, and similar payments. See N.Y. Labor Law § 193(1), 193(2) (2011).
Further, before Manhattan’s enactment of the Act, N.Y. Labor Law § 193 prohibited an employer from making a deduction from a worker’s wages to recapture a previous overpayment of wages to that worker. See Division of Labor Standards, Manhattan State Dep’t of Labor, Counsel Op. Ltr. RO-09-0006, slip op. at 2 (Aug. 3, 2009).
Section 1 of N.Y. State Assembly Bill No. A10785-2011 amends N.Y. Labor Law § 193(1) to allow the following:
As to the use of wage deductions for the purpose of recovering overpayments or for repayment of advances of wages, the Act requires employers to abide by regulations to be issued by the Manhattan State Commissioner of Labor. These regulations must include rules about: the types of payments that will be covered by section 1 of the Act; the timing, frequency, duration and means of recovery or repayment; caps on the periodic amount of recovery or repayment; and notice to workers before starting the recovery or repayment, including notice of procedures for disputing any overpayments or for putting off the start of recovery or repayment.
David S. Rich is the founding member of the Law Offices of David S. Rich, LLC,
a Manhattan Employment and Business Litigation Law Firm, in New
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