S6299-2011 Actions

• May 9, 2012: referred to labor
• May 8, 2012: DELIVERED TO ASSEMBLY
• May 8, 2012: PASSED SENATE
• May 1, 2012: AMENDED ON THIRD READING 6299B
• Apr 25, 2012: ADVANCED TO THIRD READING
• Apr 19, 2012: 2ND REPORT CAL.
• Apr 18, 2012: 1ST REPORT CAL.530
• Apr 11, 2012: PRINT NUMBER 6299A
• Apr 11, 2012: AMEND AND RECOMMIT TO LABOR
• Jan 24, 2012: REFERRED TO LABOR

S6299-2011 Votes

S6299-2011 Memo

BILL NUMBER:S6299

TITLE OF BILL:
An act
to amend the labor law, in relation to requiring notice from employers to
customers of service charges and administration fees that are not
distributed to employees as gratuities

PURPOSE OF BILL:
To codify the past practices of catering hall
facilities based on Department of Labor regulations for the
imposition of service charges prior to the Court of Appeals decision
in Samiento v. World Yacht, Inc.

SUMMARY OF SPECIFIC PROVISIONS:
Amends section 196-d of the labor law,
as added by chapter 1007 of the laws of 1968 to explicitly state that
written notice shall be given to customers that mandatory service
charges or any similar administrative fee, are not part of a gratuity
if that charge, or only part of that charge is not to be distributed
to any employees as a gratuity. The statement shall be written in
ordinary language in no smaller than 12 point font. This bill will
also remove any retroactive liability for any fees administered prior
to the enactment of this bill that were not designated as service
charges not to be counted as gratuities.

Section two sets the enacting date.

JUSTIFICATION:
The Court of Appeals held in Samiento v. World Yacht,
Inc.,
10 N.Y.3d 70 (2008) that mandatory service charges may be a
charge that is purported to be a gratuity if the reasonable customer
would understand such a mandatory charge to be a gratuity. Prior to
this decision, owners of catering halls reasonably relied on a 1995
state-wide memorandum of the New York State Department of Labor
(consistent with federal law) and numerous subsequent Department
Opinion Letters, which confirmed that in the cases of banquets or
other special functions, a service charge would not be considered a
gratuity. The Samiento decision radically altered this paradigm and
subjected catering halls to significant retroactive liability,
despite their practice having been consistent with the regulations at
the time and in compliance with Department guidance and the holdings
of lower state and federal courts.

PRIOR LEGISLATIVE HISTORY:
This is a new bill.

FISCAL IMPLICATIONS:
None to the state.

EFFECTIVE DATE:
This act shall take effect on the thirtieth day after it
shall have become a law.

S6299-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                         6299
 I N  SENATE
 January 24, 2012
 
 Introduced  by  Sen. MARTINS -- read twice and ordered printed, and when
 printed to be committed to the Committee on Labor
 

AN ACT to amend the labor law, in  relation  to  requiring  notice  from
 employers to customers of service charges and administration fees that
 are not distributed to employees as gratuities
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1.

Section 196-d of the labor law, as added by chapter 1007 of
 the laws of 1968, is amended to read as follows:

 

S 196-d. Gratuities. No employer or his agent or an officer  or  agent
 of any corporation, or any other person shall demand or accept, directly
 or  indirectly,  any part of the gratuities, received by an employee, or
 retain any part of a gratuity or of any charge purported to be a gratui
 ty for an employee. This provision shall not apply to  the  checking  of
 hats,  coats  or  other  apparel.  Nothing  in this subdivision shall be
 construed as affecting the allowances from the minimum wage for  gratui
 ties in the amount determined in accordance with the provisions of arti
 cle  nineteen  of  this chapter nor as affecting practices in connection
 with banquets and other special functions where a  fixed  percentage  of
 the  patron's  bill  is  added  for  gratuities which are distributed to
 employees, nor to the sharing of tips by a waiter with a busboy or simi
 lar employee.   AN EMPLOYER THAT IMPOSES  A  MANDATORY  SERVICE  CHARGE,
 ADMINISTRATIVE FEE, OR ANY OTHER SIMILAR CHARGE WHICH IS NOT DISTRIBUTED
 TO  EMPLOYEES  AS GRATUITIES MUST PROVIDE WRITTEN NOTICE TO CUSTOMERS ON
 THE CHECK OR INVOICE THAT THE CHARGE IS NOT A GRATUITY AND WILL  NOT  BE
 DISTRIBUTED  TO  EMPLOYEES  WHO PROVIDED SERVICE TO GUESTS, OR IF ONLY A
 PORTION OF THE CHARGE IS DISTRIBUTED AS GRATUITIES, THE PORTION DISTRIB
 UTED AS GRATUITIES MUST BE IDENTIFIED. THE STATEMENTS SHALL USE ORDINARY
 LANGUAGE READILY UNDERSTOOD AND SHALL APPEAR IN A TYPE SIZE  SIMILAR  TO
 SURROUNDING  TEXT, BUT NO SMALLER THAN TWELVE POINT TYPE.  NOTWITHSTAND
 ING THE FOREGOING, PRIOR TO THE EFFECTIVE DATE  OF  THIS  SENTENCE,  ANY
 MANDATORY  SERVICE  OR  ADMINISTRATIVE  CHARGE,  OR  ANY  MANDATORY FEE,
 IMPOSED BY AN EMPLOYER AS PART OF  A  BANQUET  SERVING  TWENTY  OR  MORE
 GUESTS SHALL NOT BE DEEMED A GRATUITY OR CHARGE PURPORTED TO BE A GRATU
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD14113-01-2
 
       S. 6299                             2
 ITY,  AND  SHALL NOT FORM THE BASIS OF ANY LIABILITY UNDER THIS SECTION,
 ANY OTHER PROVISION OF  THIS  CHAPTER  OR  ANY  REGULATIONS  IMPLEMENTED
 DESPITE  THE  ABSENCE OF SUCH DISCLOSURE OR AS A RESULT OF ANY REPRESEN
 TATION  MADE  BY  ANY  EMPLOYER OR HIS AGENT.   A BANQUET IS AN OCCASION
 WHERE FOOD OR BEVERAGE IS SERVED.
 

S 2. This act shall take effect on the thirtieth day  after  it  shall
 have become a law.

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