N.Y. Comp. Codes R. & Regs. Tit. 12 §§ 195-5.2

Current through Register Vol. 46, No. 45, November 2, 2024

Section 195-5.2 - Deductions for advances

Section 193, subdivision 1(d), of the New York State Labor Law permits an employer to make deductions from an employee's wages for repayment of advances of salary or wages made by the employer to the employee. An advance is the provision of money by the employer to the employee based on the anticipation of the earning of future wages. Any provision of money which is accompanied by interest, fee(s) or a repayment amount consisting of anything other than the strict amount provided, is not an advance, and may not be reclaimed through the deduction of wages. Deductions made in repayment of an advance are only permitted as follows:

(a) Timing and duration. The employer and employee must agree to the timing and duration of the repayment deduction in writing before the advance is given. Once an advance is given, no further advance may be given or deducted until any existing advance has been repaid in full. Any money given by the employer to the employee in excess of the amounts and durations permitted to be deducted pursuant this Part shall not be recoverable through wage deductions.

(b) Frequency. The employer shall recover advances by wage deduction no more than each wage payment, provided that such deduction complies with this Part.

(c) Method of recovery. Advances may be recovered through wage deduction or by separate transaction, as long as the procedures of subdivisions (a) and (d) through (i) of this section are followed. For purposes of this section, payments referenced as wage deductions shall include separate transactions.

(d) Limitations on the periodic amount of recovery. The amount recovered through deduction per wage payment shall be determined by the written terms of the advance authorization, and may include total reclamation through deduction of the last wage payment should employment end prior to the expiration of the other terms of the written advance authorization.

(e) Authorization. Prior to the advance being given to the employee the employee shall give written authorization for the deduction(s) to be made to repay the advance. Such authorization shall contain the amount to be advanced, the amount to be deducted to repay the advance in total and per wage payment and the date(s) when each such deduction shall be taken. This authorization may only be revoked prior to the actual provision of the advance by the employer. The authorization shall also include notice to the employee that he or she may contest any deduction that is not in accordance with the terms of the written advance authorization.

(f) The employer shall implement a procedure by which the employee, after receiving the advance, may dispute the amount and frequency of deductions that are not in accordance with the terms of the written advance authorization. An employee receiving such an advance shall be given written notice of this procedure. Dispute resolution provisions in collective bargaining agreements existing at the time of issuance of these regulations which provide at least as much protection to the employee shall be deemed to be in compliance with this section. Dispute resolution provisions in collective bargaining agreements executed after the issuance of these regulations which provide at least as much protection to the employee and which specifically reference this section shall also be deemed to be in compliance with this section.

(1) The employee shall be able to provide written notice of the employee's objection to the deduction.

(2) The employer shall reply in writing to the employee's objection as soon as practical. Such reply shall address the issues raised by the employee's objection, and contain a clear statement indicating the employer's position with regard to the deduction, including whether the employer agrees with the employee's position(s) regarding the deduction or disagrees with the employee's position(s) and provide a reason why the employer agrees or disagrees.

(g) Should an employee avail themselves to the procedure set forth in subdivision (f) of this section, the employer shall cease deductions until such reply has been given and any appropriate adjustments made. Any delay in repayment caused by this procedure shall extend the authorized time frame within which the employer may recover the advance though deductions.

(h) The failure of an employer to afford this process to the employee will create the presumption that the contested deduction was impermissible.

(i) Any provision of money by the employer to the employee that does not comply with section 193 of the Labor Law and this Part shall not be considered an "advance" and may not be reclaimed through wage deductions.

(j) Nothing in this section shall be construed as abridging the rights of the employer or employee to seek redress in any other forum, including with the Department of Labor.

N.Y. Comp. Codes R. & Regs. Tit. 12 §§ 195-5.2