New York Hospitality Employers Face Host of Wage Payment Changes
As 2015 draws to a close, restaurants, hotels, and other businesses in the hospitality industry should be aware of several important changes to their wage payment obligations that may affect their New York employees.
First, as of December 31, 2015, the New York State minimum wage will rise to $9.00 per hour from $8.75 per hour. This change affects most New York employers, including businesses outside the hospitality industry.
Second, the minimum base wage for all tipped food workers and tipped service employees in New York will rise to $7.50 per hour, which means the maximum tip credit that hospitality employers may take will be reduced to $1.50 per hour. As a reminder, hospitality employers may take a tip credit against the minimum wage only if, among other things, the tips actually received by the employee bring his or her rate to at least $9.00 per hour in 2016.
Finally, pursuant to the New York Hospitality Wage Order, employers will be required to provide in writing a new Pay Notice to each hospitality employee whose wage payment information will change in any way, even if such change is a result of the increase in the minimum wage or the decrease in the maximum permitted tip credit. A sample Pay Notice prepared by the New York State Department of Labor can be found here (although the language should be updated in accordance with this Employment Note): https://www.labor.ny.gov/.
Complying with the wage and hour requirements in the hospitality industry can be challenging – and the penalties for violations of the law can be staggering. 2015 witnessed a continued explosion of employee wage lawsuits and governmental investigations and audits. Accordingly, New York employers would be well served to carefully review their payroll practices and consult with their advisors to ensure compliance with their legal obligations.
For more information on the topic discussed, contact:
Employment Notes, a newsletter produced by Tannenbaum Helpern Syracuse & Hirschtritt LLP’s Employment Law practice, provides insights on recent employment caselaw, legislation and other legal developments impacting employer policies, human resource strategies and related best practices. To subscribe to the newsletter, email email@example.com.