New York Labor and Employment Law Report
New York's Wage Deduction Statute Poised for Amendment
June 21, 2012
By: Andrew D. Bobrek
Yesterday, an amendment to New York’s wage deduction statute – New York Labor Law Section 193 – passed both the New York State Senate and Assembly. The amendment is expected to be signed by Governor Cuomo. This legislation, if enacted, would permit employers to make a wider range of payroll deductions than currently enumerated in Section 193.
As we previously reported, the New York State Department of Labor has over the last couple of years issued several opinion letters which significantly narrow its interpretation of Section 193. To summarize, NYSDOL has taken the position that a wage deduction is not permissible unless it is very similar to those expressly recognized in the statute as lawful (e.g., payments for insurance premiums, pension, or health and welfare benefits). This interpretation varies from the NYSDOL’s historical focus on whether the deduction is for the “benefit of the employee.”
The pending amendment to Section 193 would expand the enumerated list of permissible wage deductions to include, among other things, deductions for: (1) discounted parking costs; (2) certain mass transit costs; (3) gym membership dues; (4) certain cafeteria, vending machine, and gift shop purchases; (5) pharmacy purchases made at the employer’s place of business; (6) tuition, room, and board payments for educational pursuits; and (7) day care costs. Notably for employers, the legislation would also permit the recovery of wage overpayments and wage advances by payroll deduction under certain circumstances and subject to future NYSDOL rulemaking.
We will continue to monitor this development and will provide additional details on our blog if and when the amendment is signed into law.