Tuesday, November 22, 2011

Wage Theft Act: more paperwork for NY businesses

By Bob Confer

Business owners and managers like to spend their time doing productive things that make them, their company, their coworkers, and their clients better. A business and all it affects are never made better by tasks that have absolutely no positive economic benefit; time and money spent on such endeavors can never be recouped and the positive actions that could have been done in their place are either delayed or suspended entirely. That, in a nutshell, is what makes meaningless government regulations so utterly frustrating.

A good many New York businessmen and women are unaware that one of these headaches, something called the Wage Theft Prevention Act (WTPA), will require their undivided attention come January. This law went into effect in April of this year and, going forward, requires employers to provide detailed pay notices to their employees during January of every year and/or within 7 days of a wage adjustment (raise).

The pay notification process isn’t very simple. A document must be provided to the worker that specifically indicates the employer’s name, phone number and mailing address, the employee’s pay rate, the basis of pay (hourly, salary, etc), allowances, and payday. The workers must sign-off, acknowledging their receipt and understanding of the information provided. One signed copy of the document is given to the employee while another copy is held by the employer for 6 years.

Due to the confidential nature of the primary issue being discussed (pay rate), the notification, in most cases, cannot be done collectively. Human resources or another manager will have to take the individual from his or her working duties (and have a reliever assume that person’s role for the interim) and to a private room to go over the details and gain the signature.

For each worker that task could take up to 10 minutes. Now, imagine the hassle that WTPA creates for a company the size of Confer Plastics (200 employees). The HR manager will have to spend 33.3 hours – more than three-quarters of a standard workweek – just conducting the one-on-ones. Look at a company the size of Delphi (1,500 workers). The manager, or a crew of managers, will have to devote 250 hours to this task. Think about that: That’s more than 6 weeks spent on producing paperwork that no one truly benefits from.

If said businesses issue annual raises the whole process will have to be completed all over again in that same calendar year! The process, of course, is also repeated every January.

It’s not as if an employer can opt of this. Compliance is mandatory and the Department of Labor will charge a company $50 per week per employee if they forget to issue the form, $100 per week if the form is incorrect. An affected worker can also sue the employer for damages (what damages?) to a maximum of $2,500 if they have not received a notice or have received an incorrect one.

Businesses requiring assistance in the process can find numerous WTPA templates and forms on the Department of Labor’s website at: www.labor.ny.gov

But does that help? Not really.

If the state truly wanted to make a difference and help employers, they would drop this law, just as has been suggested by a few of the Regional Economic Development Councils empowered by Governor Cuomo to produce solutions that will make New York more business friendly. They’ve made it known that regulations like these – coupled with excessive taxation – account for the economic wasteland that the upstate region has become because, quite frankly, who can make money when the state does everything it can to make sure you don’t?

Bob Confer is a Gasport resident and vice president of Confer Plastics Inc. in North Tonawanda. E-mail him at bobconfer@juno.com.


This column originally ran in the 28 November 2011 Greater Niagara Newspapers

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