(Yes, You Read That Correctly), and Subject to Damages for Failing to Do So

Section 191(1)(a) of New York’s Labor Law requires that, except for not-for-profits and employers that have obtained approval from the Department of Labor, employers must pay their manual workers at least once per week.  Notwithstanding this rule, many have paid employees susceptible of being classified as “manual workers” only semi-monthly — the minimum frequency employers are required to pay all others, except bonafide executive, administrative or professional employees earning at least $900 per week (typically overtime-exempt employees), commission sales persons, and railroad workers.  Now, a recent First Department decision makes it clear that there are real consequences for misclassifying employees and failing to pay manual workers once per week.

In Vega v. C.M & Associates Construction Management, LLC, 107 N.Y.S.3d 286 (1^st Dep’t. 2019), the Court recognized an employee’s private right of action against her employer, pursuant to Section 198(1-a) of the Labor Law, for a failure to pay wages at the legally required frequency.  Prior to Vega, an employee’s only recourse for untimely payments was to report a claimed violation to the Department of Labor.  If, upon investigation, a claimed violation was verified — the Department could then order the offending employer to pay its manual workers at the proper frequency and further impose a fine.  But, an employee had no means of bringing an action or recovering damages.

The Appellate Division’s Vega decision not only gave employees a private right of action, but also it further recognized an employee’s right to recover liquidated damages of up to 100% of the shortfall or underpayment of wages.  A shortfall or underpayment was interpreted to include late payments – even if only by one-week.  In addition, a late-paid employee may recover reasonable attorney’s fees, costs and interest.  To be clear, an employer’s late (but complete) payment of wages exposes it to real and substantial liability.

The liability to which the Vega decision exposes employers highlights the critical need for employers to properly evaluate whether they are, in fact, employing manual workers.  Though the classification of the plaintiff employee in the Vega case as a “manual worker” was not in dispute, Section 190(4) of the Labor Law defines a “manual worker” as a mechanic, workingman or laborer.  This classification has been interpreted by the Department to include employees who spend more than 25% of their time engaged in “physical labor.”  The Department has further interpreted “physical labor” to include innumerable physical tasks performed by employees.

Ultimately, whether an employee is a “manual worker” is determined by his/her job duties, and not a job title.  Such a determination is made on a case-by-case basis, but the Department has, for example, written that, based upon the duties typically associated with pizzeria workers and hairdressers, they could be classified as “manual workers.”  Given the Department’s apparent expansive interpretation, manual workers have the potential to be far more ubiquitous than many employers might have imagined.  In light of the recent increase in wage and hour claims nationwide, and the now increased lability to which New York employers are exposed, please consult us if you are not sure about whether you are employing a “manual worker” or have any questions concerning the payment of wages.