NYS Trying to Make the Hospitality Industry More Hospitable to Workers
While waiting on tables may seem straight forward (customer orders food, server brings food), the regulations governing compensation for that server, and others in the hospitality industry, are among the most complex. New York employers who’ve mastered the old regulations, with all their exceptions and special rules for tipped employees, will have to go back to school.
A new “Hospitality Wage Order" went into effect January 1, 2011, changing many of the rules, although hospitality employers had until March 1 to implement the new rules (and compensate their employees accordingly retroactive to January 1).
Now that the new requirements are in effect, employers need to comply with a myriad of compensation-related topics, such as—
• Tip pooling—employers may still not appropriate tips meant for employees and may mandate tip pooling provided written notices of the employer’s policies are provided.
• Tip credit—the amount that may be taken as a credit against minimum wage has decreased, and the amount that must be paid in wages has increased.
• Spread of hours and call-in pay—this additional compensation is also due all nonexempt employees in this industry, at any pay rate.
• Putting all nonexempt employees on an hourly wage basis—nonexempt employees in this industry can no longer be paid on a salary basis, or by weekly, daily, or piece rates.
• Overtime pay over 40 hours for all employees—no longer is the rule that residential em
ployees receive overtime pay after 44 hours worked.
• Uniform maintenance pay—such pay is now due all nonexempt employees at any pay rate (not just the lowest paid).
• Employee meals—if the work shift is long enough that a meal break is required, employees must either be able to bring a meal or be provided a meal for the no more than the meal credit amount of $2.50.
A bit of good news—minimum wage is still $7.25/hour and was not increased, and overtime pay is still time-and-one-half after 40 hours/week, with no regulatory requirements for double-time or daily overtime in New York.
Over the next few blogs, we’ll discuss the different key areas of this new wage order, and hospitality industry businesses should be sure that their practices are in compliance.
