On February 16, 2023, Manhattan District Attorney Alvin L. Bragg Jr. announced the creation of a special unit to “investigate and prosecute” wage theft, harassment, and exploitation of workers. He also announced the establishment, in partnership with the New York State Department of Labor, of a fund to repay victims of such crimes. D.A. Bragg and his office further declared support for a proposed bill in the New York state legislature that would expand the existing crime of larceny to include wage theft.
The new Worker Protection Unit was created to “pursue criminal charges” against companies across industries that deprive workers of wages or “steal their wages.” The unit was also charged with seeking to recoup potential lost wages. Those convicted may be debarred from city contracts, according to a statement from the Manhattan district attorney’s office. The effort builds off the district attorney’s office’s wage theft prosecutions in the construction and real estate development industries, and expands the focus to other industries where the office believes wage theft may be occurring, including “home healthcare agencies, fast food and restaurants, hotels, and more.” In a statement, D.A. Bragg stated that “low-income and undocumented New Yorkers” are especially vulnerable to wage theft and other abuses.
At the same time, the office is establishing the Stolen Wage Fund for Manhattan, funded through the Manhattan District Attorney’s Criminal Justice Investment Initiative and operated in partnership with the New York State Department of Labor. The fund will be used to repay victims of companies that declare bankruptcy or are otherwise unable to pay back wages. The Manhattan district attorney’s office stated that it will invest $100,000 to establish the fund, and has plans to invest up to $500,000 following evaluation of a pilot program. The fund would only apply to claims for “work performed in Manhattan, reported within one year of a criminal conviction for theft, and filed under penalty of perjury.”
Additionally, D.A. Bragg called for the passage of Senate Bill (SB) S2832, introduced by Assemblymember Catalina Cruz and state Senator Neil Breslin, to include wage theft under the state penal law for “Larceny.” Specifically, the bill would add “wages” to the definition of “property” under the larceny statute and would permit a group of workers to “aggregate takings” into a one larceny count.
The wage theft task force signals an increased focus on allegations of wage theft and could incentivize alleged victims to try to bring criminal claims to recoup wages through the victim fund. Thus, employers in Manhattan could potentially be the targets of criminal prosecution for noncompliance with certain wage and hour laws. Employers may want to consider conducting internal pay audits reviewing their pay practices in light of this increased focus.
Ogletree Deakins’ New York office will continue to monitor developments with wage theft prosecutions and the proposed wage theft bill and will post updates on the New York and Wage and Hour blogs as additional information becomes available. Important information for employers is also available via the firm’s webinar and podcast programs.