ALBANY – Gov. Kathy Hochul’s plan to close a costly loophole in state law that requires businesses to pay manual laborers weekly has been met with some stiff resistance — while budget talks remain at an impasse.
The bill hasn’t gotten much attention amid the jostling between Hochul and the Legislature over several policy changes she wants tacked onto the stalled spending plan, though business groups are pushing Albany leaders to fix a decades-old labor law that requires manual laborers to be uniquely paid on a weekly basis.
Hochul’s proposal looks to specifically clarify that the damages a business would be liable for if they’re found in violation of the law amount to the interest on their employee’s pay over that time — not a 100% match of the wages.
“Here’s a common sense measure that would help businesses that are being unfairly targeted by trial lawyers for nothing more than an honest mistake by a business,” Paul Zuber, executive vice president of the Business Council of New York told The Post.
“This is a prime example of a system gone awry and why people are fed up,” Zuber added.
Since a court ruled in 2019 that businesses are now on the hook for back wages for the entire time they’re not paying a manual laborer weekly, companies have been facing the prospect of possibly millions of dollars in penalties.
The Post reported about a lawsuit last year exploiting the labor law loophole that cost a pair of sisters, who own a Dairy Queen in Suffolk County, $780,000 and left them in financial ruin.
“This is something that I think people are worried that if we don’t address it, there’s going to be more of these lawsuits and more of the unintended consequences,” state Sen. Jeremey Cooney (D-Monroe) told The Post.
But sources said the proposal is being held up by state Sen. Jessica Ramos (D-Queens), chair of the chamber’s Labor Committee.
The budget is already nearly two weeks past its April 1 deadline.
“Ignorance of the law is no excuse for violating workers’ right to timely pay. When corporations call it a ‘mistake,’ it’s just a way to sidestep accountability after getting caught,” New York State Trial Lawyers Association President Victoria Wickman said in a statement.
“This isn’t about mom-and-pop shops—it’s about corporate giants deliberately withholding pay from people who can’t afford to wait. It’s the employer’s responsibility to know the law—and follow it,” she continued.
Rank and file lawmakers left Albany Thursday to observe Passover. The group is expected back on Tuesday, when they are likely to vote on key legislation to keep the state running through the week.
The governor took questions from reporters on Thursday — for the first time in a week — where she defended holding up the state budget.
“I’m not going to compromise my principles over a date,” Hochul said.
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