Monthly Reminders

May 2013

Shut off any electric heat tapes, line elimination devices or other equipment designed to prevent freezing during the winter..... save on electricity!

Yard cleanup; leaf and debris pickup, rake and fertilize any grass areas, mulch and prepare flower beds for planting.

Order flowers they are a cost effective way to dress up any location. Tired of planting every year? Plant annuals they come back on their own year after year.

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Tip: Have you started your saftey binder?.... check out the blog CarWash Safety 101 for more details

News | NYSCWA Legislative Update

NYSCWA Legislative Update - Fall 2012

Compliance is the Law!

By William Y. Crowell, III

In 2008, the New York State Department of Labor (DOL), under then-Commissioner Patricia Smith, conducted investigations targeting the New York State carwash industry. Eighty-four carwashes were subject to unannounced investigations and 431 carwash employees were interviewed. In New York City, more than 78 percent of the carwashes inspected were determined to be in violation of minimum wage and overtime laws. The DOL estimated that there were more than $6.5 million in estimated underpayments to employees.

The DOL followed up with these investigations, requiring offending carwash operators to pay wages owed, liquidated damages and interest to employees who were identified to have been undercompensated, and civil penalties to DOL. In a case resolved in the fall of 2010, a carwash located in upper Manhattan paid a total settlement amount of $1,960,611. The carwash industry continues to receive regulatory and media attention.

In reported cases, a consistent theme emerged — an absence of adequate payroll records. Without adequate payroll records, DOL may use the best available evidence to calculate back wages due. Weekly payroll records are required to be maintained for six years with all the following required information for each employee: name and address; social security number; wage rate; number of hours worked daily and weekly; amount of gross wages; deductions from gross wages; allowances, if any, claimed as part of minimum wages; and net wages paid. In addition, there must be careful adherence to tip credit rules. Recordkeeping needs to be a priority, not an afterthought.

The Department’s actions brought against carwash operators focused on restitution and penalties. The Attorney General, however, announced on July 16, 2012, that his office secured a jail sentence and probation for a carwash operator in the Bronx. The sentence requires the operator to serve four months of weekends in jail and three years of probation. The court further ordered a $150,000 payment in restitution to workers as a condition of probation.

Under the New York State Labor Law, an employer who fails to pay the minimum wage is guilty of a misdemeanor punishable by up to one year in jail. In addition, the Bronx carwash operator did not have workers’ compensation insurance. There was also a failure to pay certain required unemployment insurance taxes. The failure to secure workers’ compensation insurance for more than five employees within a 12-month period constitutes a felony. Criminal prosecution by the Attorney General sends a clear message to those carwash operators not complying with the law.

The co-Executive Director of Make the Road New York, which is supporting the pending NYC Council legislation (Int. 0852-2012, licensing of carwashes), and also the President of the New York State AFL-CIO were included in the Attorney General’s press release on this case with supportive comments.

The message can’t be any clearer for carwash operators — if you have not already, immediately take action to ensure that you are in compliance with all labor law, workers’ compensation and unemployment insurance requirements. Your records need to be detailed, meticulous and available for inspection. Poor recordkeeping makes your business a target. The New York State Car Wash Association (NYSCWA) just conducted a seminar on Long Island to ensure carwash operators are aware of all the legal requirements to operate their businesses and what market solutions are available to help you maintain compliance with the requirements.

Please seek assistance from the NYSCWA to resolve any compliance problems. The association will also provide assistance to carwash operators who are not members. It is critical to make compliance a priority for the entire industry in New York State. Carwash operators who are not in compliance jeopardize their livelihood, and adversely impact the majority of operators who abide by the regulatory requirements, by damaging the industry’s reputation. Compliance and recordkeeping are not only required by law, but also constitute good business practice.

William Y. Crowell is a partner with the Albany-based law firm of Whiteman Osterman & Hanna LLP. You can reach him at 518/487-7677. or via email.

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Monthly Reminders

May 2013

NYSCWA Legislative Update - Fall 2012

Compliance is the Law!

By William Y. Crowell, III