Introduction to the Federal and New York State Wage and Hour Laws

By Clifford Tucker

The Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL) are important labor laws that establish the minimum standards for wages, working hours, overtime pay, and other labor practices. The FLSA is a federal law that applies throughout the United States and the NYLL is a state law that applies in the state of New York. Although the two laws share some similarities, there are several practical differences between them. Counsel can help employees recover damages and help employers avoid litigation by understanding the requirements.

The identification of the employers to be named as defendants is a critical first step for plaintiffs. The FLSA and NYLL define terms like “employee” and “employer” broadly, covering some parties who might not qualify as such under traditional agency law principles. Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 326 (1992). “Employer” is defined similarly in the FLSA and NYLL, and “employee” is defined nearly identically. Hart v. Rick’s Cabaret Int’l, Inc., 967 F. Supp. 2d 901, 922 (S.D.N.Y. 2013) (citing 29 U.S.C. § 203; N.Y. Lab. Law § 190). To identify “employers,” courts are directed to the “economic reality” rather than “technical concepts” and usually consider four nonexclusive and overlapping factors: (1) the power to hire and fire employees, (2) supervision and control over employee work schedules or conditions of employment, (3) determination of the rate and method of payment, and (4) maintenance of employment records. Irizarry v. Catsimatidis, 722 F.3d 99, 104 (2d Cir. 2013). Employer-defendants can include owners, principals, and managers in their individual capacity, and an emplyee may simultaneously have multiple “employers” for the purposes of the FLSA and NYLL. Martin v. Sprint United Mgmt. Co., 273 F. Supp. 3d 404, 421 (S.D.N.Y. 2017).

Jurisdiction is another important consideration wage and hour cases. The FLSA covers employees who are either “engaged in commerce” (individual coverage) or “employed in an enterprise engaged in commerce” (enterprise coverage). 29 U.S.C. § 206; 29 U.S.C. § 207. For individual coverage, a substantial part of the employee’s work must relate to interstate commerce, such as communicating regularly with out-of-state customers, using the telephone and mail to engage in interstate communication, or regularly traveling across state lines while working. 29 C.F.R. § 779.103; Bowrin v. Cath. Guardian Soc., 417 F. Supp. 2d 449 (S.D.N.Y. 2006). For enterprise coverage, the employer must have a gross volume of sales or business done of at least $500,000 and engage in interstate commerce. 29 U.S.C. § 203. Virtually every enterprise in the nation that does the required dollar volume of business is covered by the FLSA. Archie v. Grand Cent. P’ship, Inc., 997 F. Supp. 504, 530 (S.D.N.Y. 1998). If an employee is covered by the FLSA, they may bring both federal and state claims in one federal action. 28 U.S.C. § 1331; 28 U.S.C. § 1367.

Counsel must identify all violations of the FLSA, NYLL, and wage orders. Wage orders are the regulations that set wage rates and labor standards for specific industries in New York. Employers must comply with these orders, which have the force of law. 12 NYCRR § 141 (building services), § 146 (hospitality, i.e., restaurants and hotels), and § 142 (miscellaneous). Where an employee is subject to both state and federal wage laws, the employee is entitled to the greatest benefit available. See Ni v. Bat-Yam Food Servs. Inc., 2016 WL 369681, at *1 (S.D.N.Y. Jan. 27, 2016).

The FLSA has a two-year statute of limitations, which can be extended to three years if the employer’s conduct was willful. 29 U.S.C. § 255. Conversely, the NYLL has a more generous six-year statute of limitations. N.Y. Lab. Law § 663. Most wage violations are not one-time events like a car crash. Wage violations often happen over an extended period—every day or week the employee is not paid lawfully—so it is essential to file claims promptly to cover as much of the employment period as possible.

The NYLL sets the minimum wage rate for New York State, which is higher than the FLSA. The FLSA minimum wage is $7.25 per hour. Conversely, as of January 1, 2024, the minimum wage for many employees in New York State is $16.00 per hour, although there are exceptions for certain industries, jobs, and regions.

The NYLL and FLSA require most employers to pay overtime at a rate of one and one-half times the regular rate of pay for any hours worked over 40 in a workweek. 29 U.S.C. § 207; 12 NYCRR § 141-1.4, 142-2.2, 146-1.4. In certain industries and jobs, New York also requires employers to pay employees an additional hour of pay for any day when the first shift starts and last shift ends over 10 hours apart, i.e., “spread of hours.” 12 NYCRR § 142-2.4, 146-1.6.

Under the FLSA and NYLL, employers must keep accurate records of their employees’ hours worked, wages earned, and other labor-related data. 29 U.S.C. § 211; 12 NYCRR § 141-2.1, 142-2.6, 142-3.6, 146-2.1. Failure to do so may allow employees to prove violations through testimony of estimated work hours and wages based on recollection alone. Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687–88 (1946); Kuebel v. Black & Decker Inc., 643 F.3d 352, 362 (2d Cir. 2011). The burden then shifts to the employer. Under the FLSA, the employer must then prove the precise amount of work performed or show the unreasonableness of the inference from the employee’s testimony. Id. Under the NYLL, the employer without payroll records must bear a more stringent burden of proving that the employee received all wages, benefits, and supplements. N.Y. Lab. Law § 196-a; Gamero v. Koodo Sushi Corp., 272 F. Supp. 3d 481, 498 (S.D.N.Y. 2017), aff’d, 752 F. App’x 33 (2d Cir. 2018).

The New York Wage Theft Prevention Act (WTPA) requires employers to provide employees with a notice, in both English and the employee’s primary language, at the time of hiring. The notice should provide information on the rate and basis of pay, regular pay day, employer’s name, address, phone number, and other relevant details. N.Y. Lab. Law § 195(1). Employers must also provide a pay stub with every payment of wages, listing dates of work, hours worked, employee and employer names, rates of pay, gross and net wages, and deductions, among other information. N.Y. Lab. Law § 195(3). Violations of the WTPA can result in up to $10,000 in damages and liability for attorney’s fees and costs. N.Y. Lab. Law § 198.

Employers who violate minimum wage, overtime, and spread of hours requirements are liable for unpaid wages, attorney’s fees, costs, interest, and 100% liquidated damages. 29 U.S.C. § 216; N.Y. Lab. Law § 198, 663; C.P.L.R. 5004. To avoid liquidated damages, an employer may present an affirmative defense that it acted in good faith and with reasonable grounds to believe its actions were not violations. 29 U.S.C. § 260; N.Y. Lab. Law § 198(1-a). However, the burden is difficult to meet, and double damages are the norm. Barfield v. New York City Health & Hosps. Corp., 537 F.3d 132, 150 (2d Cir. 2008); Reich v. S. New England Telecommunications Corp., 121 F.3d 58, 71 (2d Cir. 1997).

In conclusion, while the FLSA and NYLL share some similarities, there are practical differences between them. It is important to stay up to date on any changes to these laws as they can have a significant impact on employees’ rights and remedies and employers’ exposure to liability.

Author Biography

Clifford Tucker, Esq., is a trial attorney licensed in New York and New Jersey. He practices employment and personal injury law at the Law Office of Sacco & Fillas LLP. Mr. Tucker focuses on representing clients in matters related to minimum wage, overtime, spread-of-hours, the Wage Theft Protection Act, and retaliation under the federal Fair Labor Standards Act, New York Labor Law, and the implementing regulations of federal and state wage and hour laws. Additionally, he handles discrimination and harassment actions and provides representation for civil servants in administrative proceedings. Mr. Tucker serves clients from various industries, including hospitality, restaurants, construction, retail business, and civil service. His representation extends to the United States District Courts for the Southern and Eastern District of New York, the New York State Supreme Court, the New York State Division of Human Rights, the New York City Commission on Human Rights, the New York State Department of Labor, and administrative proceedings. Mr. Tucker also represents clients who have been injured in accidents such as construction injuries, motor vehicle accidents, pedestrian knockdowns, and premise cases involving slips, trips, and falls. Mr. Tucker has taught Continuing Legal Education classes on case preparation, investigation, negotiation, and discovery. Mr. Tucker also taught the “Basic Wage & Hour Rules: Spotting Red Flags” Continuing Legal Education class at the Injured Workers Bar Association 2024 Winter CLE.

Mr. Tucker can be reached at 929-405-6764 and [email protected].

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