Responsibilities of New York Employers
Disclaimer
This guide addresses some of the responsibilities of employers in New York State and City. It does not include every responsibility and there are many more resources on the topics listed. This guide does not cover all the related laws and regulations. This guide was last updated on January 10, 2023 and some of the information may have since changed. The information in this guide is not legal advice and is not intended to be relied upon as legal advice. If you have a legal issue, you should not rely on this information and instead speak to an attorney.
This guide includes links to third party websites for access to information and resources. We do not control these websites. We have not reviewed all the content that appears on these websites, and are not responsible for the legality, accuracy, or appropriateness of their content. Content on these websites may change at any time, including after we decide to share their links on this site. For legal advice about your specific situation, you should consult with a qualified attorney.
Introduction
Employers in New York must be aware of many federal, state, and local laws and regulations. It’s important to understand these rules and the responsibilities they establish. Establishing clear policies and procedures, and updating them regularly, can make legal compliance easier and more efficient. Speaking with an experienced advisor to establish your policies and procedures is strongly encouraged.
EMPLOYEE v. INDEPENDENT CONTRACTOR
The determination of whether an individual is an employee or an independent contractor of a business can have significant ramifications on legal risks and liability, civil rights, taxes, benefits like unemployment insurance, and more. Some of the attributes of the relationship to consider are whether the individual performs their work without direction or control from the business (in the contract and in reality), performs the services in their own name or the business’s name, offers and delivers their services to the general public or business community regularly and free of the business’s input, and pays for their own licenses, supplies, and administrative costs. Business owners are encouraged to speak with an experienced attorney to assess whether individuals should be treated as employees or independent contractors.
Also, check out our guide, Independent Contractor or Employee? Tips for Small Businesses in New York for more information.
WAGES AND BENEFITS
Wages
Employers in New York State are required to pay employees the state minimum wage (currently $15.00) or more. As of April 1, 2022, the Living Wage Rate in New York City is $15.00 and the Health Benefit Supplement is $2.05 (it will be $2.15 starting April 1, 2023).
Overtime, Rest, Etc.
Eligible employees who work more than 40 hours in a calendar week are entitled to 1.5 times their base hourly rate for overtime. Most employees are eligible for overtime. The New York Attorney General provides information about overtime, rest time, and more here.
Interns
An intern is exempt from minimum wage rules if the intern is not an employee. To learn more about how to determine if an intern qualifies as an employee, see the New York State Department of Labor’s guide, Wage Requirements for Interns in For-Profit Businesses.
Taxes
Employers must deduct and pay the correct amount of income taxes from their employees’ wages, calculate and pay the employer’s share of taxes, and file timely returns with the IRS, the New York Department of Taxation and Finance, and their local tax agency.
Employers must report information about each newly-hired or rehired employee who will work in New York State within 20 days from their first day of work to New York DTF.
Employers are required to withhold and deposit an employee’s payroll taxes - including FICA (for Social Security and Medicare), federal, state, and local employment taxes - depending on the specific employee’s earnings. You can learn more about tax withholdings in New York on the New York Department of Taxation and Finance’s website here.
Employers have certain employment tax responsibilities, including the Federal Unemployment Tax discussed further below. They may also have responsibilities based on their location, for instance the Metropolitan Commuter Transportation Mobility Tax (MCTMT) for employers in New York City and the counties of Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester. You can learn more on the IRS’s website here.
Health Insurance
Employers with 50 or more full-time or full-time equivalent employees must offer health insurance that is affordable to full-time employees and their children up to age 26. Employers with fewer than 50 full-time employees can offer health insurance through the small group market or healthcare reimbursement plans.
Sick and Safe Leave
If an employer has 4 or fewer employees, and their net income is $1 million or less, they must provide 1 hour of unpaid sick leave for every 30 hours of work (up to 40 hours) to each employee each year. If their net income is greater than $1 million, they must provide up to 40 hours of paid sick leave. If the employer has 5-99 employees, they must provide each employee 1 hour of paid sick leave for every 30 hours of work (up to 40 hours) each year. You can find more information on the New York State’s Paid Sick Leave Overview page.
Employers in New York City must provide both sick and safe leave. Safe leave is leave for the care and treatment of an employee or a family member and to seek legal and social services assistance or take other safety measures if the employee or a family member may be the victim of any act or threat of domestic violence or unwanted sexual contact, stalking, or human trafficking. Employers must provide written notice of safe and sick leave rights to employees when they begin employment or when their rights change.
Paid Family Leave
New York employers must provide up to 12 weeks Paid Family Leave to eligible employees to bond with a newly born, adopted, or fostered child, care for a family member with a serious health condition or assist loved ones when a family member is deployed abroad on active military service.
New York State Paid Family Leave is insurance that may be funded by employees through payroll deductions.
More guidance for employers can be found in New York State’s “Employer Resources: Model Language for Employee Materials.”
Retirement Plans
Employers of 10 or more employees (full or part-time) in New York who have been in business for at least 2 years must offer employees a qualified retirement plan or the New York State Secure Choice Savings.
While a small business is generally not required to offer retirement benefits, the Setting Every Community Up for Retirement Enhancement Act (SECURE Act) makes it easier for small businesses to provide 401(k) and other retirement options to employees by reducing the cost of administering retirement plans. Eligible employers may be able to claim a tax credit of up to $5,000, for three years, for the ordinary and necessary costs of starting a SEP, SIMPLE IRA or qualified plan (like a 401(k) plan).
You can learn more about 401(k) Plans for Small Businesses on the Department of Labor’s page here and learn more about the SECURE Act on the US Chamber of Commerce’s page here.
Notices to Employees and Postings
New York State employers must provide written notice to employees concerning your policies on vacation, sick leave, personal leave, holidays, and hours of work, as well as regular and overtime rates of pay.
Employers must also post or provide notice to employees about a variety of other legal protections and rights.
All NYC employers must provide current and newly hired employees with a physical or electronic copy of the Department of Consumer and Worker Protection (DCWP) Workers’ Bill of Rights beginning July 1, 2024 and, if they have physical location, post the “Know Your Rights at Work Poster” in the workplace.
NYC law requires that job postings include a good faith salary range.
The DCWP maintains a list of workplace laws for employers.
INSURANCES
Unemployment Insurance
The federal-state unemployment insurance program provides benefits to eligible individuals who have lost their job. Employers must contribute to the fund at a rate set by the U.S. Department of Labor each March.
The New York State Department of Labor (NYSDOL) decides if a business must pay unemployment insurance. Most employers must pay unemployment insurance. Employers can call the NYSDOL hotline with questions about liability and registering for unemployment insurance at 888-899-8810.
Workers Compensation Insurance
Workers’ Compensation insurance covers on-the-job injuries and is required for almost all employers and those who have direct control over contractors in New York.
The New York State Workers’ Compensation Board’s Employer’s Guide to Worker’s Compensation states:
“If people are under your direct control, you probably have employees, regardless of their tax status; the person providing direction and control at the moment of compensable injury is the employer. For these purposes, the term employee generally includes day labor, leased employees, borrowed employees, part-time employees, unpaid volunteers (including family members) and most subcontractors.”
Their classification of independent contractors can be found in their Identifying an Independent Contractor guide (scroll to “All Other Industries”).
Employers can obtain Workers' Compensation Insurance from private insurance carriers, the New York State Insurance Fund or through self-insurance approved by the New York State Workers' Compensation Board (individual or group).
The Worker’s Compensation Board shares tips for reducing the cost here.
State Disability Insurance
Disability insurance covers off-the-job injuries and is required for almost all employers in New York if you have employees more than 30 days in a calendar year.
Employers can obtain Disability Insurance from private insurance carriers, the New York State Insurance Fund or through self-insurance approved by the New York State Workers' Compensation Board.
Other Business Insurance
Managing risk is very important so employers should research the different types of available insurance. Some insurances are needed for permits and licenses, and some protect you from loss, fines, and lawsuits.
ADDITIONAL LEGAL REQUIREMENTS
Reporting Requirements
Employers must verify the identity and employment eligibility of employees, have employees complete a W-4, and report information about new hires to the State.
Sexual Harassment Policies and Trainings
The New York State Human Rights Law protects employees and others against sexual harassment in the workplace. Employers must adopt a sexual harassment prevention policy and training that meet or exceed the law’s minimum standards. You can find more information on New York State’s Combatting Sexual Harassment in the Workplace page.
New York City also has training requirements for all employers. The New York City Commission on Human Rights has developed an online training that satisfies both the New York State and New York City sexual harassment prevention training requirements that is available here.
Discrimination
Federal, state, and local laws protect most workers from discrimination, bias, and/or harassment based on certain protected characteristics. New York State law protects most workers against discrimination or harassment based on their age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, status as a victim of domestic violence, arrest record or conviction record, or sincerely held practice of religion.
New York City provides protection to all the above-listed characteristics as well as on the basis of arrest or conviction record, caregiver, credit history, pre-employment marijuana testing, unemployment status, sexual and reproductive health decisions, salary history, and status as a victim of domestic violence, stalking, and sex offenses.
Reasonable Accommodations
Federal, State, and local laws require most employers to provide certain reasonable accommodations to allow employees to perform their job.
Health and Safety in the Workplace
Federal, State, and local laws requires employers to provide employees with a safe workplace. The US Department of Labor Occupational Safety and Health Administration (OSHA) has information about their requirements on their website here and in their Small Business Safety and Health Handbook.
In New York the Department of Labor, the Department of Health and local health departments have additional requirements for workplace safety. You can find more information on their websites here: Department of Labor and Department of Health (includes links to local health departments).
Consult a Small Business Attorney
An experienced attorney can determine your business’s specific responsibilities and advise you about how to efficiently meet them. Contact Pepitone Law for a consultation.
