Final New York Hospitality Industry Wage Order Issued; Will Go Into Effect January 1, 2011

On December 15, the New York Department of Labor issued the Final Hospitality Industry Wage Order, which goes into effect on January 1, 2011. The Order is quite detailed, and immediately should be closely reviewed by hospitality (hotel and restaurant) employers to ensure compliance by the new year.

The Final Order sets the basic minimum hourly rate ($7.25 per hour) (146-1.2). It also contains detailed regulations concerning: tip credits for service employees and food service workers (146-1.3); overtime hourly rates for non-tipped and tipped employees (146-1.4); call-in pay (146-1.5); pay for instances where the spread of hours is greater than 10 in restaurants and all-year hotels (146-1.6); uniform maintenance pay (146-1.7); costs of purchasing required uniforms (146-1.8); credits for meals and lodging (146-1.9); employer records (146-2.1); the required written notice of pay rates, tip credit and pay day (including a sample notice) (146-2.2); required pay stub information (146-2.3); posting requirements (146-2.4); a requirement that covered employees other than commissioned salespeople be paid an hourly rate (146-2.5); a requirement of the minimum wage for each week of work (146-2.6); permissible deductions and expenses (146-2.7); credits and requirements concerning meals and lodging (146-2.8); working at tipped and non-tipped occupations on the same day (146-2.9); employment covered by more than one wage order (146-2.10); learner, trainer or apprentice rates (146-2.10); rehabilitation programs (146-2.12); students obtaining vocational experience (146-2.13); tip sharing and tip pooling (146-2.14-2.17); charges presumed and not presumed to be a gratuity or tip (146-2.18-2.19); and tips charged on credit cards (146-2.20). The Order also contains a detailed definitions section (146-3.1-3.11).

This Final Order contains several minor revisions to the October 4, 2010 Proposed Order, which was summarized in the November 2010 issue of the New Jersey eAuthority. The Department of Labor’s Responses to Comments concerning the Proposed Order also have been made public, and shed additional light on the scope and proper interpretation of the regulations.

Although the Order is effective January 1, 2011, by public notice issued on December 16, the Department is allowing employers to implement the minimum wage changes by March 1, 2011 (or their next regularly scheduled pay day following March 1, 2011) provided that (1) all employees covered by this rule are paid any additional wages owed to them on account of this rule computed retroactively to January 1, 2011, (2) proper records are kept of the retroactive payments, and (3) employers post a notice (in a form being prepared by the Department of Labor) regarding the implementation period and the entitlement to retroactive payment of wages.

If you would like to discuss the Wage Order in more detail, please contact the Ogletree Deakins attorney with whom you regularly work.