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One to Keep An Eye On: S2844B (New York)


As with many employment and labor law related cases (and bills) being litigated around the country, there are always a few that stand out.  This is one to keep an eye on.


Recently, the New York State Legislature passed S2844B, a bill that would enable an employer's current or former employee or the New York State Department of Labor to place a lien on an employer's interest in real or personal property for the face value of a wage claim (plus liquidated damages.)  In New York, a wage claim is defined as a claim for a violation of New York Labor Law Sections 170 (hours for labor for domestic workers), 193 (deductions from wages), 196-d (gratuities), or 652 and 673 (minimum wages), as well as the related regulations and wage orders promulgated by the labor commissioner.  A wage claim also includes a claim for wages due to an employee pursuant to an employment contract that were unpaid in violation of that employment contract as well as a claim for a violation of the Fair Labor Standards Act.

While the lien may be filed at any time, it may not be filed later than three years following the end of the employee's employment giving rise to the wage claim.  As well, the lien may not be placed on an employer's bank account or goods.

However, despite these restrictions, many employers in the state have expressed concern about the reach of the legislation.  As some have argued, if New York Governor Andrew Cuomo signs S2844B into law, it could potentially freeze credit needed by small employers (as a lien might have some banks deciding not to issue credit to these small employers.)  As well, the argument has been made that employees would have unfair leverage, with the ability to file these liens against employers.  It will be interesting to see whether Governor Cuomo puts pen to paper here.  Stay tuned.


For a copy of S2844B:  https://legislation.nysenate.gov/pdf/bills/2019/S2844B

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