New York Regulations on Wage Payment Methods Declared Invalid

As we previously reported, on September 7, 2016, the New York State Department of Labor ("NYSDOL") published final regulations on the methods by which employees must be paid, including with respect to direct deposit of wages and payroll debit cards.  These regulations–to be codified in 12 NYCRR Part 192–were scheduled to take effect on March 7, 2017.

On February 16, 2017, the New York State Industrial Board of Appeals (the "IBA")–an independent agency charged with reviewing the validity and reasonableness of NYSDOL rules, regulations, and orders–revoked the regulations, determining that they were "invalid because they exceed [the NYSDOL's] rulemaking authority."

The IBA focused on two provisions in the regulations–(1) the requirement that employers provide access to one or more ATMs that offer withdrawals at no cost to employees, and (2) the prohibition on charging employees certain fees related to the use of a payroll debit card.  The IBA held that rulemaking