CALL FOR A FREE CONSULTATION | 877-629-9275

A Complete Guide To New York Overtime & Minimum Wage Laws

New York’s giant workforce turns big profits for employer’s small and large: the state comes in behind only California and Texas as the third largest state economy.

In short, New York makes and sells more than almost any other state. But many of the employees who make this possible remain in low-wage jobs, struggling to get by. Some are the victims of wage theft, inexcusable violations of federal and state law that take money right out of the pockets of those who need it most.

What Are The New York Wage & Hour Laws?

With such a huge low-wage labor market, you’d think New York State would have some of the country’s most progressive wage and hour laws. Thanks to the advocacy of countless low-wage workers, you’d be right.

New York City Skyline

In April of 2016, State Governor Andrew Cuomo signed a law that will raise New York’s state minimum wage to $15 an hour by 2021. That’s nearly double the current federal minimum wage, which is set at an extraordinarily low $7.25 per hour. Five years from now, most workers in New York State will be entitled to at least $15 for every hour of labor. Many employees in New York City will become entitled to $15 even earlier – by 2018.

These changes, however, will take time. In order to give businesses time to adjust, New York’s minimum wage is being increased incrementally, slowly over several years. The minimum wage also changes depending on where you work. In fact, New York has six separate minimum wages right now. Cuomo’s goal is to have these disparate rates converge – on $15 per hour – in 2021, but the rate for workers at large companies in NYC will grow much quicker than it will for employees upstate.

2017 Minimum Wage In New York City

Since living in New York City is most expensive, workers there have been given the largest raises. For 2017, the minimum wage in New York City is $11 per hour, but only if you work for a company with at least 11 employees. This rate will rise relatively quickly, by $2 every year, until it reaches the ultimate goal of $15 in 2018.

Work for a smaller company, one with fewer than 11 employees? Your current minimum wage is $10.50. There’s no guarantee that the minimum wage for workers at small businesses will ever reach $15. The law only provides for an increase to $13.50 by 2018.

Suburbs of New York City have also been set on the fast-track. In Nassau, Westchester and Suffolk Counties, most employees are entitled to a 2017 minimum wage of $11 per hour, although the mandatory rate is higher for workers at fast food restaurants. Wages in suburbs of the city are expected to reach $15 per hour by 2021.

Outside The City

Outside of New York City and its surrounding regions, the state minimum wage is currently set at $10.40. That rate is expected to rise by 70 cents every year, ultimately reaching $12.50 by 2020.

Fast Food Workers

In New York, workers at fast food restaurants (between 164,000 and 200,000 employees) have their own minimum wage. Fast food workers in New York City are entitled to $12 per hour as of January 1, 2017. Workers outside the city should be making at least $10.75 per hour.

McDonalds isn’t the only major company affected by New York State’s drastic changes for fast food employees. In fact, New York’s Labor Board has crafted a broad definition of “fast food establishment,” encompassing any business that:

  • primarily serves food or drinks, including coffee shops, juice bars, donut shops, and ice cream parlors; and
  • offers limited service, where customers order and pay before eating, including restaurants with tables but without full table service, and places that only provide take-out service; and
  • is part of a chain of 30 or more locations, including individually owned establishments associated with a brand that has 30 or more locations nationally

White Castle, Dunkin Donuts, Taco Bell, Subway, Starbucks, Chipotle and Ben & Jerry’s all fit the bill. Most of these businesses, up to 90%, are franchises. To see a full list of businesses that are considered “fast food establishments,” check out the appendix to this report from New York’s Fast Food Wage Board.

Minimum Wage For Tipped Employees

Make tips on a regular basis? Your employer is allowed to “credit” a certain amount of those tips toward their minimum wage obligations. In essence, companies can pay you less than the minimum wage, as long as your regularly-received tips make up the difference. As in other areas, New York’s regulations for tipped employees are extremely complicated, changing based on what you do, who you work for and where you work.

Hospitality Industry

In the table below, you’ll find the minimum wage requirements for tipped employees in New York City’s hospitality industry. The first figure, labeled “Cash Wage,” represents the lowest hourly wage your employer can pay you without breaking the law. Remember, they can only pay you this wage, which is technically below New York’s minimum wage, because you make at least the “Max Tip Credit” in tips on a regular basis.

New York City
Large Employers Small Employers
Service Employees
  • $9.15 (Cash Wage)
  • $1.85 (Max Tip Credit)
  • $8.75 (Cash Wage)
  • $1.75 (Max Tip Credit)
Food Service Workers
  • $7.50 (Cash Wage)
  • $3.50 (Max Tip Credit)
  • $7.50 (Cash Wage)
  • $3.00 (Max Tip Credit)

New York State’s labor regulations divide the hospitality industry into two categories: food service and service. Food service is fairly easy to understand; service is a catch-all term for any service industry job that doesn’t fall under food service. Large employers have at least 11 employees, while small employers have fewer than 11.

Long Island & Westchester County
Large Employers Small Employers
Service Employees
  • $8.35 (Cash Wage)
  • $1.65 (Max Tip Credit)
  • $8.10 (Cash Wage)
  • $1.60 (Max Tip Credit)
Food Service Workers
  • $7.50 (Cash Wage)
  • $2.50 (Max Tip Credit)
  • $7.50 (Cash Wage)
  • $2.20 (Max Tip Credit)

Beyond the suburbs of New York City, business size isn’t taken into account:

Remainder Of New York State
Service Employees
  • $8.10 (Cash Wage)
  • $1.60 (Max Tip Credit)
Food Service Workers
  • $7.50 (Cash Wage)
  • $2.50 (Max Tip Credit)

Tipped Workers In Other Industries

New York State allows employers in almost every other industry to take tip credits, too. In fact, there’s only one industry, Building Service, in which taking a tip credit isn’t allowed.

New York City
Large Employers Small Employers
aasdlfkja;sdkfja;slkdfj
  • $8.30 (Cash Wage) – when tips are at least $2.70 per hour
  • $7.95 (Cash Wage) – when tips are at least $2.55 per hour
  • $9.35 (Cash Wage) – when tips are at least $1.65 per hour, but less than $2.70 per hour
  • $8.90 (Cash Wage) – when tips are at least $1.60 per hour, but less than $2.55 per hour
Long Island & Westchester County Remainder Of New York State
  • $7.55 (Cash Wage) – when tips are at least $2.45 per hour
  • $7.35 (Cash Wage) – when tips are at least $2.35 per hour
  • $8.50 (Cash Wage) – when tips are at least $1.50 per hour, but less than $2.45 per hour
  • $8.25 (Cash Wage) – when tips are at least $1.45 per hour, but less than $2.35 per hour

 

Overtime Wages In New York State

The FLSA entitles most lower-wage employees to premium wages for overtime, as does New York State’s General Industry Minimum Wage Act. Both laws generally take a weekly approach to overtime.

Most employees, including residential workers, who work more than 40 hours in a given workweek are entitled to overtime wages for their extra time. Overtime has to be paid at “time and a half,” one-and-a-half times a worker’s “regular rate,” which is an important concept we’ve covered here.

Are You Being Paid “Daily Overtime”?

Under New York law, covered employees who work a split shift, or more than 10 hours in a day, are entitled to an additional payment of one hour at the state minimum wage. While federal courts have held that this additional payment is not required for workers who make more than minimum wage, few employees who do qualify for the extra money actually receive it. In fact, fewer than 7% of eligible employees receive the “daily overtime” that they are entitled to.

Who Is Exempt From New York’s Wage & Hour Laws?

Some workers aren’t covered by the state’s overtime protections and thus are not entitled to premium wages for any hours worked over 40.

New York’s overtime laws follow most of the exclusions enumerated in the FLSA. For a full discussion of jobs that are actually exempt from the Fair Labor Standards Act’s overtime provisions, read through our guide here.

If it seems like you’re exempt under the FLSA, you’re probably exempt under New York State’s laws, too. But some employees who sound like their exempt according to the FLSA actually are entitled to overtime in New York:

  • Some workers at amusement or recreation establishments that are only open seasonally
  • Some computer systems analysts, programmers and software engineers

These employees, who fall under only New York State’s overtime laws, must be paid for hours worked over 40 at one-and-one-half the state’s minimum wage, regardless of their actual regular rate.

State Minimum Wage Exemptions

Other workers aren’t entitled to New York’s minimum wage:

  • employees who can be properly classified as “executives or “administrators” and make more than $600 per week. For an explanation of executives and administrators, click here.
  • Anyone who can be accurately classified a “professional.”
  • Outside salespeople
  • Cab drivers
  • The majority of government employees
  • Members of a religious order
  • Volunteers and students at a non-profit
  • Babysitters who work part-time

Do New York’s Wage & Hour Laws Apply To Undocumented Workers?

Absolutely.

In terms of the minimum wage and your right to overtime pay, New York doesn’t care whether or not you’re a documented worker. This goes for workers who are paid hourly, daily or weekly, employees who are paid by cash or check and even workers paid off the books, too.

You have a right to fair pay.

How Common Is Wage Theft?

In 2011, between 4% and 6% of all wage earners in New York were being paid lower than the minimum wage. That’s illegal and, if the Department of Labor’s study is correct, surprisingly widespread.

Using data from the US Census Bureau, the DOL estimated that employers were stealing $20.1 million from their workers’ paychecks every week. And that only includes minimum wage violations. Those workers were losing 47.5% of their total income to wage theft.

Obviously, this is unacceptable. We think it’s immoral. But it’s only the tip of the iceberg.

“A World In Which America’s Core Labor Laws Are Failing”

In 2008, the National Employment Law Project sent a survey to low-wage workers in New York City, including many undocumented workers who are usually overlooked by this sort of poll.

The questions were simple. How many hours did you work last week? how much were you paid? Did your employer deduct anything from your wages? Did you work off the clock?

But the results were stunning:

  • 21% of workers in the sample were paid less than minimum wage
  • 77% of the employees who worked more than 40 hours in a week weren’t paid any overtime
  • 37% of tipped workers made less than the lower minimum wage for tipped employees
  • 93% of eligible workers didn’t receive their daily overtime pay for hours worked over 10
  • 69% didn’t get paid for time worked outside of their normal shift hours, even though the FLSA and state law consider this time compensable hours worked

The researchers wrote that their report had exposed “a world of work in which America’s core labor and employment laws are failing to protect significant numbers of workers in the nation’s largest city.”

Contact Our Wage & Hour Violation Lawyers

If the National Employment Law Project’s findings are any indication, most low-wage workers in New York are being stolen from. A lawyer can help.

To learn more about your rights and legal options, just call 877-629-9275 or fill out our contact form. Laurence Banville, Esq., a lawyer in the WageAdvocates.com alliance, is licensed to practice in the state of New York.