As an employer, have you ever wondered if a wage deduction you made was legal? New York Labor Law establishes what is legal and what is not for wage deductions. If you have questions, it is always wise to seek legal counsel from an experienced employment law defense attorney.
The NY legislature passed an amendment to NY Labor Law 193 Deductions from Wages in October 2015. The amendment went into effect on November 6, 2015 and expires on November 6, 2018, unless the legislature renews it. Two main features of the amendment are allowing employers to deduct for over payments and salary advances.
Overpayments
The amendment permits employers to make wage deductions for accidental overpayments. Overpayments refer to payments made due to a mathematical or clerical error by the employer. Note that the employer must provide the employee with a notice of the overpayment deduction prior to commencing the recovery.
Also, regulations govern how the deduction is made based on the size of overpayment along with the timing, frequency, duration and method of recovery. In addition, the employer must provide a procedure for the employee to dispute overpayment amounts and the procedure for recovering it.
Salary Advances
The employer must abide by rules the Commissioner has established for the timing, frequency, duration and method of deduction of a salary advance. There are also limitations on the periodic amount of repayment of the advance. Employers must provide employees with a notice before commencing repayment and also provide a procedure for the employee to dispute the amount or to seek delay of repayment.
In addition to wage advances and overpayments, some of the other allowed deductions include:
- Insurance premiums
- Prepaid legal plans
- Pension or health and welfare benefits
- Dues or assessments to a labor organization
- Discounted parking or discounted passes, tokens, fare cards, vouchers or other items that entitle the employee to use mass transit
Do You Have Questions about Wage Deductions?
Our attorneys are glad to answer your questions and address your concerns.
Stephen Hans & Associates provides decades of experience to business owners regarding employment related issues.