New York: General Contractors are Jointly Liable for Construction Worker Wages

APPLIES TO

All New York General Contractors

EFFECTIVE

January 4, 2022

QUESTIONS?

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New York general contractors take heed: new legislation that becomes effective next year makes general contractors jointly and severally liable for wages, benefits, or wage supplements owed by subcontractors to construction workers, even if the general contractor is not ordinarily the employer or joint employer of the worker. The new law becomes effective January 4, 2022 and applies to new contracts as well as already-existing contracts that are extended or amended after January 4, 2022.

Construction workers will be able to bring civil or administrative actions to recover unpaid wages, liquidated damages, and attorneys’ fees from general contractors within three years of the alleged non-payment, without having to prove that the general contractor employed or jointly employed the complainant. Instead, joint employer status is automatically conferred upon the general contractor for the purpose of recovering any unpaid wages.

To facilitate compliant pay practices and allow general contractors to monitor subcontractors, general contractors will be granted the authority to demand subcontractors produce certified copies of all payroll records normally required to be kept under New York labor law, as information about subcontracted workers and contract assignments. Further, general contractors may withhold payments to any subcontractor that refuses or is unable to provide such information in a timely manner.

Finally, the legislation prohibits contractors from taking actions in attempt to evade the requirements of the law, such as requiring workers to sign an agreement waiving their right to sue the general contractor.

Action Items

Have contracts with subcontractors reviewed by legal counsel to minimize exposure.
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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.