New York City (NYC) Employee Wage & Tipped Pooling Attorney

New York City attorneys providing legal representation in employee wage & tip issues for workers at bars and restaurants in Manhattan, Brooklyn, Queens, and the Bronx.

New York State’s minimum wage is $7.25 per hour** [See Note Below].  This is technically the same for both tipped and non-tipped employees.  Employers are permitted, however to take a credit against a portion of their employees’ earned tips up to $2.25 per hour for food service workers and $1.60 per hour for non-food servicer workers.  In other words employers must pay tipped food service employees (so long they make at least $2.25 per hour in tips) a minimum wage of at least $5.00 per hour, or $5.65 per hour in the case of a non-food service employee. 

Employees must be paid for their overtime hours (anything over 40 hours per week, or 10 hours per day) at the rate of 1 ½ times their normal rate of pay for each hour worked.  Tipped employees must be paid time-and-a-half for the full minimum wage of $7.25 per hour less the $2.25 per hour tip credit. 

NYC Bars & Restaurants Unlawful Withholding of Wages & Tips

Tip pooling is permitted in New York State, however, employers are prohibited from taking an employee’s tips or using them in any manner other than as a tip credit described above.  Likewise, an employer is not permitted to force a tipped employee to share his or her tips with non-tipped employees.

  1. In calculating the number of employee hours worked, do you consider the hours when an employee stays late or works through lunch? [Note:  All hours worked, regardless of whether those hours were worked at the request of the employer, must be considered for overtime purposes.]
  2. If you employ undocumented workers, do you pay them at the same rate as documented workers? [Note:  Undocumented workers have practically the same rights as documented workers with respect to wages and they are entitled to the same minimum wage and overtime pay rates.]
  3. Do you keep and maintain records of every hour worked by your employees? [Note:  The Department of Labor requires all employers to keep a record of the hours worked by their employees.  If you fail to do so you can be fined by the Department of Labor and be found liable in a wage and hour lawsuit.]
  4. How do you handle an employee who complains that he/she is not receiving minimum wage or overtime pay? [Note:  Federal, State and City law prohibit employers from firing or disciplining employees who voice pay rate complaints, and if an employer is found to have violated wage and hour laws, they can be fined and even forced to pay the employees’ attorneys’ fees.]
  5. In calculating the number of employee hours worked, do you include time spent by your employees when they are running errands or performing work related tasks for you (such as putting on their uniforms) on the way to or from work? [Note:  Employees must be compensated for all time ‘worked’ which can include those tasks taken or performed immediately before clocking in, or just after clocking out.]
  6. Before taking a tip credit, do you advise your employees of: (a) their rate of pay; (b) the amount you will claim as a tip credit; (c) that the tip credit claimed cannot exceed the amount of tips received by the employees; (d) that employee tips are the property of the employee (subject to valid tip pooling arrangements) and not management or non-tipped employees; and (e) that the tip credit cannot be taken unless the employee is informed of these notice requirements?

In addition to fines and penalties imposed by the Department of Labor, employers who intentionally fail to pay appropriate wages can be sued or even criminally prosecuted. 

NoteNew York recently agreed increase the minimum wage to $9 per hour, to be phased in over three years, as follows: 

  • $8.00 on and after December 31, 2013; 
  • $8.75 after December 31, 2014; 
  • $9.00 after December 31, 2015.

For the time being, the Tip Wage for food service workers will remain at the current $5 when an employee's tips meet or exceed the increased minimum wage.  Eventually, the Tip Credit issue will have to be dealt with by a Wage Board that may be appointed by the Department of Labor near the end of 2013.  The Wage Board will be responsible for drafting a Wage Order in response to the minimum wage increase and  has the ability to  modify or otherwise change the tip credit and other allowances an employer may take. 

If you are in need of legal representation to fight an employee wage & tip issue claim, call DiPasquale & Summers
for a free consultation at (646) 343-4607.

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