New York Governor Andrew Cuomo recently signed legislation enacting a statewide $15 minimum wage plan. The state joins California with the highest minimum wage in the nation. This increase is the second significant increase in wages within three months. As will be seen below, the increases are complicated and may be difficult for employers to implement.
As of December 31, 2015, the Minimum Wage Act (Article 19 of the New York State Labor Law) required that all employees in New York State receive at least $9.00 per hour, including domestic workers.
Wage Orders
Additionally, Regulations known as “Wage Orders” set additional requirements that are industry specific:
As of December 31, 2015, the Minimum Wage for individuals working in the ‘fast food industry’ is $10.50 per hour in New York City, and $9.75 per hour in the rest of the state.
As of December 31, 2015, the Minimum Cash Wage for Tipped Workers in the Hospitality Industry is $7.50 per hour if they earn enough in tips.
As of December 31, 2015, the Minimum Wage for other Tipped Workers is $7.65 per hour if they earn at least $1.35 per hour in tips, or $6.80 per hour if they earn at least $2.20 per hour in tips.
As of December 31, 2015, the Minimum Wage for all other workers is $9.00 per hour.
For workers in New York City employed by large businesses (those with at least 11 employees), the minimum wage would rise to $11 at the end of 2016, then another $2 each year after, reaching $15 on December 31, 2018.
For workers in New York City employed by small businesses (those with 10 employees or fewer), the minimum wage would rise to $10.50 by the end of 2016, then another $1.50 each year after, reaching $15 on December 31, 2019.
For workers in Nassau, Suffolk and Westchester Counties, the minimum wage would increase to $10 at the end of 2016, then $1 each year after, reaching $15 on December 31, 2021.
For workers in the remaining counties of the state, the minimum wage would increase to $9.70 at the end of 2016, then another .70 each year after until reaching $12.50 on 12/31/2020. Thereafter, it will continue to increase to $15 on an indexed schedule to be set by the Director of the Division of Budget (DOB) in consultation with the Department of Labor.
What’s next?
Beginning in 2019, the State DOB Director will conduct an annual analysis of the economy in each region and the effect of the minimum wage increases statewide to determine whether a temporary suspension of the scheduled increases is necessary. That analysis will be submitted to the Department of Labor by the Division of Budget for possible further action.
In addition to the substantial economic burden that these increases pose for NY employers, the layering of rates and scenarios, as well as differing geographic impacts, will add to the complexity of compliance.
What about fast food chains?
The concept of “fast food chain” wage requirements is new. New York provides the following advice concerning the parameters applied to this targeted employer group:
Q: What is a Fast Food Establishment?
A: A Fast Food Establishment is any business that meets the following criteria:
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.
The list above summarizes several definitions that are published in 12 NYCRR § 146-3.13, which should be consulted for the full and complete terms.”
The effects of these increases and whether these increases will truly benefit the workers to receive such increases, remains to be seen. Many employers that operate with thin profit margins may either close or find ways to reduce labor costs. The unfortunate result may be less employment and no net increase in the goal of providing workers with a “living wage.”
Are Stay Interviews the Key to Retaining Top Talent?
Retaining top talent continues to be one of the greatest challenges facing employers today. Even in an employer’s market, the loss of a key employee can disrupt operations and result in significant costs. While compensation plays a role, long-term retention often depends on workplace culture, communication, and employee engagement. One increasingly popular strategy for improving […]
Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]
Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications
Cashing a check marked “paid in full” can be a risky endeavor, particularly if you don’t fully understanding the legal implications. If you are owed more than the amount of the check you accept and deposit, you may waive your right to collect the full disputed amount. That is why you should consider either rejecting […]
Changes to Qualified Small Business Stock Will Benefit Startup Founders and Investors
The One Big Beautiful Bill Act of 2025 (OBBBA) significantly impacts federal taxes, credits, and deductions. A key change relating to Qualified Small Business Stock (QSBS) allows greater tax-free gains for investments in startups and other qualifying small businesses. Company founders and other investors should understand how the enhanced tax strategy works or risk missing […]
Corporate Consolidation and Antitrust Issues in Mergers
Corporate consolidation involves two or more businesses merging to become a single larger entity. The result is often a stronger and more competitive company that can better navigate today’s competitive marketplace. What Is Corporate Consolidation? Corporate consolidation closely resembles a basic merger transaction. The primary difference is that a consolidation creates an entirely new business […]
Business law plays a critical role in nearly every aspect of running a successful enterprise, from negotiating a commercial lease to drafting employee policies to fulfilling corporate disclosure obligations. Understanding what is business law and your legal obligations can help your business run smoothly and build productive relationships with clients, business partners, regulators, and others. […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
