My Company Performs Work For New York City. What Living Wage Must My Company Pay To Its Employees?

Under the Fair Wages for New Yorkers Act,  N.Y. City Admin. Code § 6-134 (the “New York City Fair Wages Act,” the “Fair Wages Act,” the “Act,” or the “NYCFWA”) and then-New York City Mayor Bill de Blasio’s Executive Order No. 7 dated September 30, 2014 (“Executive Order No. 7”), companies or individuals who receive, from New York City or from a City economic development entity, financial assistance of one million dollars or more (to improve or develop real property, to develop economically, to retain or create jobs, or for other similar purposes) and who enter into a project agreement with New York City or a City economic development entity must pay their workers the “living wage” for each hour worked.  This living wage includes both an hourly wage rate, known as the living wage rate, and an hourly health benefits supplement rate.

As of January 1, 2024, the living wage rate and the health benefit supplement rate are as follows:

• Living Wage Rate: $16.00 per hour
• Health Benefit Supplement Rate: $2.15 per hour

As of April 1, 2024, the living wage rate and the health benefit supplement rate are as follows:

• Living Wage Rate: $16.00 per hour
• Health Benefit Supplement Rate: $2.15 per hour

The living wage rate is well in excess of the federal minimum wage of $7.25 per hour.  However, the New York State minimum wage for the borough of Manhattan and for the remainder of New York City, which effective January 1, 2024 increased from $15.00 to $16.00 per hour, is equal to the living wage rate.

The Fair Wages Act applies not only to companies or individuals who receive, from New York City or from a City economic development entity, financial assistance of $1 million or more and who enter into a project agreement with New York City or a City economic development entity, but also to any entity or person who contracts or subcontracts with such a financial assistance recipient to perform, for the financial assistance recipient, work for a period of more than 90 days on the recipient’s premises or on the premises of property improved or developed with $1 million or more of the City’s financial assistance.

Under the Act, the workers, to whom companies or persons (who receive, from New York City, financial assistance of $1 million or more and who enter into a project agreement with New York City) must pay the living wage rate of $16.00 per hour plus an hourly health benefits supplement rate of $2.15 per hour, include employees, independent contractors, and contingent or contracted workers, including individuals made available to work through a temporary staffing agency.

Further, the Act entitles such workers to the living wage rate of $16.00 per hour plus the hourly health benefits supplement rate of $2.15 per hour whether those workers perform work on a full-time, part-time, temporary, or seasonal basis.

Executive Order No. 7 exempts, among other employers, “[s]mall [b]usiness[es],” which Executive Order No. 7 defines as entities which have annual gross revenues of less than three million dollars.

However, unlike the federal Fair Labor Standards Act and the implementing regulations establishing the federal minimum wage, and unlike the New York Labor Law and the implementing regulations setting the New York State minimum wage, the Fair Wages Act sets forth no exemptions from its living wage for employees employed as bona fide executive, administrative, professional and outside sales employees.

The NYCFWA confers, on any worker whom a covered employer pays less than the living wage rate of $16.00 per hour or the health benefit supplement rate of $2.15 per hour, a cause of action against the employer for compensatory and punitive damages, appropriate injunctive relief and, if the worker wins his lawsuit, reasonable attorneys’ fees and costs. Under the Act, the limitation period for workers’ unpaid wages claims is three years.

Further, the Comptroller of the City of New York (the “City Comptroller”) may audit covered employers in the borough of Manhattan and in the remainder of New York City to determine whether the employers are paying their workers the living wage.

If the City Comptroller determines that a covered employer in Manhattan or elsewhere in New York City has violated the Fair Wages Act, the City Comptroller, among other remedies, may direct that employer to pay wages and/or the monetary equivalent of benefits wrongly denied and also may direct the employer to pay liquidated damages of up to 200% of the wages and benefits found to be owing.

In other words, if the City Comptroller determines that a covered employer in the borough of Manhattan or elsewhere in New York City has failed to pay its workers the living wage, the City Comptroller, among other relief, may direct the employer to pay treble (that is, triple) monetary damages.

Call Manhattan Unpaid Wages Lawyer David S. Rich at (347) 970-5550 to speak with a knowledgeable labor and employment lawyer about ensuring that your company complies with overtime pay and other wage and hour laws, or to retain a skilled overtime attorney to defend your company in unpaid overtime lawsuits or other wage and hour litigation.