A Guide to Understanding New York Wage & Overtime Requirements

As an employer, it’s so important to know where your employees are performing their work as this has many compliance and tax impacts. While this may seem obvious, it’s trickier to track as businesses shift towards remote and hybrid work. So if you’ve got employees working in New York, you’re going to want to pay attention to the specific laws governing pay requirements for these folks. These laws specify minimum wage, overtime pay, and meal breaks, among other laws.

To add another layer of complexity beyond state law, it’s also going to depend on the locality in New York in which your employees are working, as the requirements can differ between cities and counties.When hiring new employees in New York, or when auditing your pay practices, keep these basics top of mind. In this article, we'll provide an overview of some key New York wage and hour laws (not including paid leave requirements) and some compliance tips to help make things as smooth as possible.

Minimum Wage in New York

New York has minimum wage and overtime requirements that are applicable to most employees and exceed federal requirements. You can find the most up-to-date minimum wage requirements from the New York State Department of Labor. Effective December 31, 2022, the minimum wage rate in NYC, Long Island and Westchester remains $15/hour. For everywhere else in the state, it is $14.20/hour.If you have employees who split their time working between two localities due to a hybrid schedule, you might consider what pay rate will comply with both jurisdictions.

Overtime Laws in New York

The Fair Labor Standards Act (FLSA) is the federal wage and hour law that regulates, among other things, minimum wage and overtime. The FLSA exempts certain kinds of employees from the federal minimum wage and overtime requirements. Non-exempt employees are those that are subject to the minimum wage and overtime requirements under the FLSA.New York has exemption regulations that differ in some ways from the FLSA, so some occupations may be exempt from overtime under the FLSA but are still entitled to overtime under New York’s overtime requirements.

It’s a good idea to review the New York State Department of Labor (NY DOL) overtime FAQs when determining whether an employee is exempt from overtime requirements. For example, NY currently has a higher salary threshold for exempt employees, as well as different descriptions for the types of job duties that qualify employees as exempt. The NY DOL also has even more FAQs specifically for the administrative, professional and executive exemptions, which are some of the more common classifications for office workers. You can find these by searching on the NY DOL website.If an employee is not considered exempt from overtime requirements, they will be entitled to additional pay for all hours that qualify as overtime. This is true regardless of whether or not the overtime hours were authorized or approved. In New York, most employees must receive overtime pay at the rate of 1.5x their regular rate of pay for all hours worked in excess of 40 in a workweek.There are a few exceptions to this general rule depending on certain types of workers, including residential workers and farm workers. This NY DOL wages and hours page covers more detail on those requirements.

Meal & Rest Breaks in New York

In addition to overtime laws, New York also has meal break requirements for employees. These requirements are designed to protect employee health and safety by ensuring that workers have time to take breaks during their shifts. While meal breaks may generally be unpaid, shorter rest breaks are compensable and count towards working hours.

Generally speaking, most nonexempt office employees working a traditional 9-5 must be given an uninterrupted 30 minute meal break between the hours of 11am - 2pm. If they work later and/or longer hours, there can be additional meal break requirements. These details can be found on a NY DOL’s FAQ. These requirements are subject to limited exceptions, such as certain situations where there is only one employee present and must take a meal while on the job. In this case, the employer must receive an explicit acknowledgement of this expectation from the employee and they must be paid for this meal time.While NY does not require employers to provide rest breaks of short duration, if you do provide short breaks (less than 20 minutes), these breaks must be paid and count toward hours worked. Finally, New York employees are also allowed reasonable breaks to nurse or express breast milk.

Pay Transparency

With New York joining the wave of pay transparency laws sweeping the country, it’s extra important to pay attention to your pay practices, both for internal equity and competitive hiring. The compensation information on your job posts will be available to candidates and current employees alike, and the simplest way to maintain fairness and consistency will be to establish compensation bands that are anchored in job type, job level and market data.

While certain candidate factors could influence where an individual falls within that band, your band itself won’t change based on any candidate traits or competencies; an important distinction for pay equity purposes and beyond. While thoughtful bands take more time to prepare, it will help you avoid ad-hoc decisions that could become headaches to manage down the line.

Ensuring Compliance with NY Wage Laws

As a business owner, it's important to ensure that you are complying with pay requirements and overtime laws. If you fail to comply with overtime laws, you may be subject to litigation, regulatory scrutiny, fines and other penalties.Here are some other tips to help you stay compliant:

• Stay up to date on these laws. You might want to bookmark some of the NY DOL web pages that provide guidance on the topics we covered, including the Minimum Wage FAQ and Overtime FAQ. It’s a good idea to audit your practices every time there is a change in the requirements, and at least annually. You can also review if anyone’s exemption status has changed based on a promotion or job transfer.

• Keep accurate records of your employees’ schedules and hours worked. This includes any time spent on work-related tasks, even if they are outside of a regular shift such as events, training sessions and sometimes travel time. A great way to help stay on top of this is to use a software system that makes it easy to track and record hours. Find a trusted software solution that can support this in a seamless and compliant way for your employees.

• Have a written policy outlining your pay policies. This includes information on overtime deductions, meal and rest breaks, and timekeeping requirements. This will help ensure that employees are aware of their rights and responsibilities, and it will provide a reference point if there are any questions.

• Seek legal advice. To ensure compliance with applicable wage and hour requirements, it’s best to consult an employment attorney.

A Helping Hand for Compliance

New York’s wage laws are designed to protect employees and ensure they are fairly compensated. As a business owner, it's essential to understand the laws and make sure you are compliant. If you have any questions, you should consult with an experienced employment law attorney.If you're looking for an all-in-one solution to help with compliance, payroll support, and time tracking software, check out Justworks' PEO. Whether you have employees in New York or any other state, our tool can help you run your business with confidence.