A Change to the Law Regarding Prevailing Wages for Public Work
If you have been following the buzz regarding the proposed changes to existing New York State Labor Law, then you’re probably interested to know what exactly those changes are.
First, a procedural note as to the status of the proposed legislation. Bill A5498-A passed in the Assembly on May 1, 2018, and S2975-A (which is the Senate’s version of the same bill) is currently being considered by the Senate Finance Committee before it moves to the Senate floor for a vote. If the bill passes in the Senate, it will then go to the Governor for signature and become the law in New York State.
The proposed legislation amends the current Labor Law to clarify what constitutes “public work,” what it means to be paid “in whole or in part out of public funds,” and what qualifies as a “public entity.” As currently written, the law limits labor on public works projects to eight (8) hours a day, five (5) days a week and requires that any work performed over this amount (i.e., over forty (40) hours in one week) be paid at the prevailing overtime rate for that particular trade/work in the locality.
The bills’ sponsors, which include Democrats and Republicans, justify these amendments as protection for local labor that may be undermined by the use of cheaper, outside labor on publicly financed projects. Currently, laborers on publicly financed projects may be receiving prevailing wages but only pursuant to case law that has increasingly narrowed and eroded the situations in which prevailing wages must be paid. These bills seek to codify the requirement to pay prevailing overtime wages on all “public work,” which is defined in the bills as:
- Construction work paid for in whole or in part out of public funds;
- Construction work performed on property owned by a public entity in whole or in part or that will be owned or maintained by a public entity in whole or in part upon completion of the project; or
- Construction work performed under private contract on private property but only when the property subject to the construction contract is leased or will be leased to the state or a public entity either through a lease that was entered into before the construction began or where the construction is done per the specifications of the state or public entity and the lease is entered into with the state or public entity during construction or after the project is completed.
The bills specifically exclude certain construction from the definition of “public work”:
- Construction on one- or two- family homes where the property is the owner’s primary residence or where the property owner owns no more than four (4) homes;
- Construction work performed under a contract with a non-profit where $100,000.00 or less of public funds are used for the project and the non-profit has gross annual revenue of less than one million dollars; and
- Construction work on projects that include 75% or more of affordable housing as defined in the bill and in the Real Property Tax Law.
The proposed legislation also allows the Commissioner of Labor to issue a stop work order to a non-complying project but only after the Commissioner has provided notice of the intent to do so. The notice must be served according to the procedure found in the Civil Practice Laws and Rules, must inform the subject of his/her right to a hearing, and must provide the subject with all documents, reports, or information that form the basis for the decision to issue a stop work order. The bills further provide that the Commissioner may release a stop work order upon a finding that there has been a meaningful and good faith attempt to comply with the law.
If these bills become law and you are unsure if your construction project qualifies as a “public work,” then you should contact an attorney to be sure that you are complying with the law.
This is not intended to be legal advice. You should contact an attorney for advice regarding your specific situation.
Jennifer S. Echevarria is an Associate with the firm and practices Immigration and Employment Law including U-Visas and wage violations. She is bilingual in Spanish and can be reached by phone at 866-303-9595 toll free or 845-764-9656 and by email.