New York Governor Vetoes “Wage Theft” Lien Bill, Promises Replacement
Concluding that it too broadly defined “employer” and raised a myriad of due process concerns that subjected it to risks of unconstitutionality, on December 31, 2019, Governor Andrew Cuomo Governor Cuomo vetoed a bill that would have allowed a current or former employee (or the New York State Department of Labor), alleging “wage theft” by an employer, to place a lien on the employer’s interest in real or personal property for the value of the wage claim plus liquidated damages. “Wage theft” is defined to include such claims as minimum wage violations, failing to pay overtime, and not paying tipped workers the difference between their tips and the legal minimum wage. The bill was passed by the New York legislature last summer and was discussed in detail in a Jackson Lewis article here: New York Legislature Passes Bill Allowing Liens on Employers For Alleged Wage Claims.
Although the veto comes as a relief to employers operating in New York, the reprieve may be brief. In his memorandum vetoing the bill, Governor Cuomo made it clear that he intends to propose replacement legislation in 2020 to allow victims of wage theft to use “any and all assets, even personal assets, of the bad actor” to satisfy a judgment. The Governor noted that his administration has been very aggressive when it comes to providing wage theft protections for vulnerable employees but was concerned that the due process issues inherent in the current bill might lead a court to find it unconstitutional.