Q: Can a New York Employer Deduct Overpaid Wages From an Employee’s Paycheck?

MoneyA: Currently, deductions from an employee’s wages for money owed to the employer as a result of an overpayment of wages are prohibited in New York even with the employee’s written consent. Recently, both houses of the New York Legislature passed Bill 49 which amends New York state labor laws to allow new deductions from employee paychecks including (among others) deductions for overpayments of wages due to mathematical or clerical errors.  All deductions must be voluntary and authorized in writing by the employee.  Authorization records must be kept during the employee’s term and for six years after employment ends.  Also, employers will have to give prior written notice of any repayment schedule and the employee must be notified in advance of any substantial changes.  Employers will also have to establish a procedure for disputing repayment terms.  Bill 49 is expected to be signed by the Governor.

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