Section 193 of the NYS Labor Law prohibits employers from making any deductions from an employee's wages except as expressly authorized by law or as both "expressly authorized in writing" by the employee and "for the benefit of the employee," and also prohibits employers from requiring employees to make payments by separate transactions if such payments would not be permitted as wage deductions. Section 193 limits deductions that may be authorized by employees to "payments for insurance premiums, pension or health and welfare benefits, contributions to charitable organizations, payments for United States bonds, payments for dues or assessments to a labor organization, and similar payments for the benefit of the employee." As discussed in our June 2010 Alert, the NYS Department of Labor (NYS DOL) had opined that employers in New York could not make deductions for repayments of salary advances, overpayments, loans, advances of unearned vacation pay, tuition assistance repayments and the like from employee wages, even if the employees had authorized such deductions in writing.
Section 193 has now been amended, effective November 8, 2012, to permit employers to make deductions authorized by employees for, among other things, advances of salary or wages, overpayment of wages due to mathematical or clerical errors, tuition, parking, gym membership dues, cafeteria purchases and day care. Deductions for the repayment of advances and for overpayments must comply with regulations to be promulgated by the Commissioner of the NYS DOL and which must include, but not be limited to, provisions governing: timing, frequency, duration, and method of repayment; limitations on periodic amount of repayment; requirement of notice to employees prior to the commencement of such repayment; and procedures for disputes regarding the repayment.
Section 193, as amended, imposes additional obligations on employers that apply to all wage deductions authorized by employees including, but not limited to, requiring written notice of the details of the manner in which deductions will be made, requiring advance notice of any substantial change to such deductions and requiring employers to keep the authorization on file for six years after the employee's employment ends. In addition, Section 193, as amended, provides that employees may revoke, in writing, their authorization for such deductions at any time. The amendments to Section 193 expire in three years unless renewed.
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