A 5000: Clarifies that the statutory damages available for certain wage violations are not punitive in nature and are designed to be liquidated damages rather than penalties or to compensate workers for the employer's failure to prevent wage theft and for the harm to employees that results from such failure.

  
  STATE OF NEW YORK ________________________________________________________________________ 5000 2025-2026 Regular Sessions  IN ASSEMBLY February 10, 2025 ___________ Introduced by M. of A. BRONSON, SIMON, McMAHON, RAGA -- read once and referred to the Committee on Labor AN ACT to amend the labor law, in relation to liquidated damages for labor law violations The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short Title. This act shall be known and may be cited as 2 the "labor law enforcement parity act". 3 § 2. Legislative Findings. 1. The legislature finds and declares that 4 it has always been its intention that the remedies provided under the 5 labor law be fully and equally enforceable in both state and federal 6 court. However, some state courts have misconstrued the liquidated 7 damages available for violations of the labor law as penalties, despite 8 the fact that the legislature amended the labor law's liquidated damages 9 provision in 2009 and 2010 to bring it in line with the compensatory 10 purposes of the Fair Labor Standards Act's liquidated damages provision. 11 As a result, while employees have been able to recover the full amount 12 of compensatory liquidated damages owed to them in federal court 13 actions, they are not always able to do so in state court actions. 14 Accordingly, the first purpose of this bill is to clarify that all 15 liquidated damages available for violations of the labor law, which are 16 generally an amount equal to the unpaid or underpaid wages, are compen- 17 satory in nature and not penalties. 18 2. The legislature further finds and declares that both federal and 19 state courts have recently misconstrued the purposes of New York Labor 20 Law § 195. Despite allowing claims for violations of the labor law's 21 wage notice and wage statement provisions to proceed for years, and 22 allowing workers to recover the full statutory damages provided under 23 the labor law for these violations, some federal courts have begun 24 dismissing these claims for lack of Article III standing, claiming that 25 these violations do not cause workers any concrete injury. Meanwhile, EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD06533-01-5 
 A. 5000 2 1 some state courts have misconstrued the statutory damages available for 2 violations of the wage notice and wage statement provisions as penalties 3 and have thus not allowed workers to recover the statutory damages 4 provided, even though they have been able to do so in many federal 5 courts. Accordingly, the second purpose of this bill is to clarify that 6 the statutory damages available for violations of the wage notice and 7 statement provisions of the law are not punitive in nature, and are 8 instead designed to compensate workers for their employer's failure to 9 prevent wage theft in the first place, and the harms employees suffer as 10 a result, including being unable to discover, identify, and remedy wage 11 theft promptly and possible loss of valid wage theft claims due to the 12 passage of the statute of limitations, the stress and uncertainty caused 13 by unclear pay details, which can significantly impact their ability to 14 make informed employment choices, effectively manage their finances, and 15 plan for personal, familial, or social commitments. 16 § 3. Subdivision 3 of section 198 of the labor law, as amended by 17 chapter 397 of the laws of 2021, is amended to read as follows: 18 3. Notwithstanding any other provision of law, an action to recover 19 upon a liability imposed by this article must be commenced within six 20 years. The statute of limitations shall be tolled from the date an 21 employee files a complaint with the commissioner or the commissioner 22 commences an investigation, whichever is earlier, until an order to 23 comply issued by the commissioner becomes final, or where the commis- 24 sioner does not issue an order, until the date on which the commissioner 25 notifies the complainant that the investigation has concluded. Investi- 26 gation by the commissioner shall not be a prerequisite to nor a bar 27 against a person bringing a civil action under this section. All employ- 28 ees shall have the right to recover full wages, benefits and wage 29 supplements, statutory damages, and liquidated damages accrued during 30 the six years previous to the commencing of such action, whether such 31 action is instituted by the employee or by the commissioner, including 32 in a class action. There is no exception to liability under this 33 section for the unauthorized failure to pay wages, benefits or wage 34 supplements. 35 § 4. Subdivision 1 of section 663 of the labor law, as amended by 36 chapter 564 of the laws of 2010, is amended to read as follows: 37 1. By employee. If any employee is paid by [his or her] such employ- 38 ee's employer less than the wage to which [he or she] such employee is 39 entitled under the provisions of this article, [he or she] such employee 40 shall recover in a civil action the amount of any such underpayments, 41 together with costs all reasonable attorney's fees, prejudgment interest 42 as required under the civil practice law and rules, and unless the 43 employer proves a good faith basis to believe that its underpayment of 44 wages was in compliance with the law, an additional amount as liquidated 45 damages equal to one hundred percent of the total of such underpayments 46 found to be due, including in a class action. Any agreement between the 47 employee, and the employer to work for less than such wage shall be no 48 defense to such action. 49 § 5. This act shall take effect immediately and shall apply to all 50 actions concerning labor law violations that occurred within the six 51 years prior to this act's effective date.