Wage and Hour Defense Blog

On May 9, 2025, Governor Hochul signed a budget bill into law that includes an amendment (“the Amendment”) to the New York Labor Law (NYLL). This Amendment took immediate effect, applies to pending and future actions, and dramatically changes the relief employees can seek for first-time violations the pay frequency provisions for “manual workers” found in NYLL Section 191.

The Amendment substantially reduces potential damages from 100% liquidated damages to lost interest on delayed payments for first-time violations of the NYLL’s frequency of pay requirements where employers otherwise paid manual workers’ wages on regular pay days, no less frequently than semi-monthly. For future violations, liquidated damages will only be available for a second or subsequent violation if there is a finding and order by the New York State Department of Labor (“NYS DOL”) or court of competent jurisdiction of a prior violation for employees performing the same work.  

On May 1, 2025, the U.S. Department of Labor’s (DOL) Wage and Hour Division (Division) issued Field Assistance Bulletin (FAB) No. 2025-1 (“FAB 2025-1”), announcing that it is currently working to reformulate the test as to how independent contractor status is determined under the Fair Labor Standards Act (“FLSA”).  Although it is unclear what contours the revised rule will eventually take, FAB 2025-1 signals a clear intention to make it easier for businesses to classify workers as independent contractors. 

The rulemaking process will take time.  FAB 2025-1 accordingly provides that, during the interim, the DOL will no longer enforce a 2024 rule established under the Biden administration.  The 2024 rule, which consisted of a non-exhaustive multi-factor test, is largely viewed as placing a difficult hurdle with respect to independent contractor classification.

FAB 2025-1 relaxes the DOL enforcement standard by reverting to the “economic reality” framework outlined in Fact Sheet #13 (July 2008), as informed by Opinion Letter FLSA2019-6. The “economic reality” framework asks whether the worker is an independent contractor in business for themselves, or an employee economically dependent on the business they serve. While this does not involve a single rule or test, significant factors include:

The complex web of federal and state wage and hour laws create potentially devastating risk of exposure for employers.  Years of possible liability for yet unknown claims, liquidated damages, shifting attorneys’ fees, not to mention the risk of class or collective suit, can quickly transform seemingly minor and technical irregularities into expensive complications.  And for companies that partner with other entities to meet their staffing needs, resolving this risk of liability is a critical piece of their business operations.

Quite often, the quick solution for this concern is through a traditional business arrangement: contractual indemnification.  Shifting risk of loss via contract is fairly standard, especially as courts generally enforce the unambiguous terms of the parties’ agreement.  Yet employers should take note of a concerning trend among courts across the country, which have in some cases refused to enforce indemnification agreements in Fair Labor Standards Act (“FLSA”) matters on public policy grounds.

In a surprisingly employer-friendly decision, the California Court of Appeal recently held that voluntary, prospective written meal waivers for shorter shifts, i.e., those that are more than five but no more than six hours in total, are valid and enforceable.  In Bradsbery v. Vicar Operating, Inc., the Court of Appeal held that revocable, prospective meal waivers for shorter shifts are enforceable in the absence of any evidence the waivers are unconscionable or unduly coercive.

Case Background

Plaintiffs, former veterinary assistants and technicians, filed a putative class action in July 2014 against their former employer, Vicar Operating.  Plaintiffs alleged in part that Vicar Operating had violated Labor Code section 512(a) by requiring Plaintiffs and putative class members to work shifts between five and six hours without a meal period and without waiving their right to a meal period by mutual consent.  Plaintiffs argued that as a result, Vicar owed Plaintiffs and the putative class members premiums for missed meal periods.

In a decision with significant implications for employers and employees alike, the New Jersey Supreme Court on March 17, 2025, clarified that commissions constitute wages under the New Jersey Wage Payment Law (“NJWPL”). In Musker v. Suuchi, Inc. et al., the Court reversed the rulings of both the trial court and the Appellate Division, holding that commissions paid for an employee’s labor or services “always constitute a wage under the WPL.”

In drawing its conclusion, the court focused on the NJWPL’s definition of “wages,” which is defined as “direct monetary compensation for labor or services rendered by an employee, where the amount is determined on a time, task, piece, or commission basis.” N.J.S.A. 34:11-4.1(c) (emphasis added).

Wage and hour compliance often presents complex challenges for employers, with unclear regulations and changing enforcement priorities.

Addressing these issues proactively and resolving potential disputes are vital for maintaining compliance and reducing risks.

In this one-on-one interview, Epstein Becker Green (EBG) attorney Paul DeCamp sits down with fellow EBG attorney George Whipple to offer his seasoned perspective on wage and hour matters. Tapping into his experience as the former head of the Wage and Hour Division under President George W. Bush, Paul provides an insider’s view of government enforcement priorities, compliance pitfalls, and the complexities employers face when disputes arise.

Beginning April 9, 2025, Ohio employers will be legally required to give employees access to their paystubs. Citing transparency, accountability, and fairness in the workplace, the Ohio General Assembly unanimously passed the the Paystub Protection Act (PPA),  which requires Ohio employers to issue paystubs, either electronically or via hard copy, to all employees on regular paydays that include the:

• Names of the employee and employer;
• Employee’s address;
• Employee’s total gross wages during the pay period;
• Employee’s total net wages during the pay period;
• Amount and purpose of each addition or deduction to wages; and
• Dates of the pay period.

For hourly employees, the following three additional items are required:

• Total hours worked;
• Hourly rate; and
• Hours worked in excess of 40 hours in one workweek.

While California employers may be generally aware of the nine requirements for wage statements, a careful review of the nuances of each of those requirements is necessary to ensure compliance under Labor Code section 226. But the inquiry does not end there. When, how, and what to do to maintain these records is equally important in maintaining compliance and thereby protecting the company against wage statement penalties.  

Required Contents—the Basics

We previously covered what California employers need to include on wage statements pursuant to Labor Code section 226(a):

1. Gross wages earned;
2. Total hours worked;
3. Certain information for employees paid on a piece-rate basis;
4. All deductions;
5. Net wages earned;
6. Pay period;
7. Employee’s name and either (a) the last four digits of the social security number or (b) employee identification number;
8. Name and address of the legal entity that is the employer; and
9. All applicable hourly rates.

More than a decade ago, Epstein Becker Green (EBG) created its complimentary wage-hour app, putting federal, state, and local wage-hour laws at employers’ fingertips.

The app provides important information about overtime, overtime exemptions, minimum wages, meal periods, rest periods, on-call time, and travel time, as well as tips that employers can use to remain compliant with the law and, hopefully, avoid class action, representative action, and collective action lawsuits and government investigations. 

As the laws have changed over the years, so too has EBG’s free wage-hour app, which is regularly updated to reflect those developments.

Section 3(m)(2)(B) of the FLSA prohibits employers, including managers or supervisors, from keeping any portion of an employee’s tips.  Accordingly, the law has been clear that a manager or supervisor cannot participate in a general employee tip pool, since tip pools including tips of other employees. 

Although this appears clear at first blush, the blurred lines of restaurant staffing creates ambiguity as to who is exactly a manager or supervisor.  Non-exempt employees often work in a certain supervisory capacity as team or shift leads.  Conversely, it is also common for managers and supervisors in restaurants to perform a certain amount of non-supervisory duties.  So, when are employees with minor supervisory responsibilities treated as managers for tip pooling?  And can managers participate in tip pools when they perform non-supervisory duties?