The New York Fiscal Year 2026 Budget introduces significant changes that will impact employers across the state, particularly those employing minors or navigating wage and discrimination claims. The budget is usually enacted by April 1 each year.
Below are key updates and what they may mean for your business:
- Digitization of Youth Working Papers. New York is modernizing the employment process for minors with a new online system that serves as a centralized portal for young workers, caregivers, employers, and school administrators. This system will streamline the issuance and management of employment certificates for minors, which will now be maintained electronically within a secure database.
The bill will not take effect immediately; instead, there is a two-year implementation period, allowing employers time to adapt to the new requirements.
Once available, employers will need to:
- Register with the Department of Labor: Provide details about your business and any minors you employ.
- Certify Compliance: Ensure they are meeting all child labor law requirements.
- Maintain Electronic Records: Keep employment certificates accessible within the new database.
- Increased Penalties for Child Labor Violations. The Budget includes legislation raising the maximum civil penalties and includes felony-level charges for violations that result in serious injury to minors, including:
- Higher fines: Up to $10,000 for a first offense, $30,000 for a second, and $75,000 for subsequent violations.
- Steeper penalties for injuries: Fines ranging from $3,000 to $225,000 if a minor is injured or dies due to illegal employment.
- Criminal penalties: Knowingly violating child labor laws can now lead to imprisonment and increased fines.
- New felony offenses: Including “Criminally Negligent Homicide of a Child Worker” and “Endangering the Welfare of a Child Worker.”
Implications for Employers
- Increased compliance costs.
- Enhanced record-keeping to demonstrate compliance.
- Greater liability for injuries to minors.
- Training may need to be conducted to ensure compliance.
- Stricter enforcement of child labor laws.
- Expanded Wage Theft Enforcement
The Department of Labor (DOL) now has expanded powers to address wage theft, including:
- Liquidated damages: Up to 100 percent for underpayment, or 300 percent for willful violations.
- Attorney fees: Employers may have to pay the employee’s attorney’s fees in successful wage claims.
- Changes to damages for late payment: Penalties for late wage payments, even if made on time, are introduced.
Impact on Employers
- Increased financial risk for wage and hour violations.
- Greater emphasis on compliance.
- Potential increase in wage and hour litigation.
- Importance of demonstrating “good faith” efforts to comply.
- Bolstering the State’s Ability to Eliminate Discrimination
The budget increases funding for the Division of Human Rights (DHR) to better address discrimination complaints:
- Increased Staffing: The agency may be able to more effectively and efficiently process discrimination complaints.
- Discrimination Complaints Escrow Fund: Established to hold settlement funds and awards for complainants.
- Clarified DHR authority: DHR’s power to manage the escrow fund is explicitly stated.
- Removal of “administrative convenience” dismissal: Ensures all complaints are investigated.
Implications for Employers
- Increased liability exposure for past discriminatory actions.
- Greater scrutiny of settlements and pressure to ensure complainants receive due compensation.
- Emphasis on conciliation and early dispute resolution.
- Minimum Wage Increase for Human Services Staff
The budget includes a 2.1 percent minimum wage increase for staff at programs licensed or authorized by the Office of People with Developmental Disabilities (OPWDD), the Office of Mental Health (OMH), and the Office of Addiction Services and Support (OASAS).
Impactions for Employers
- Increased funding for eligible programs.
- Focus on staff recruitment and retention, potentially leading to improved wages and benefits.
- Accountability in how the funds are used.
- Limited use of funds for executive compensation.
Next Steps for Employers
Employers are encouraged to review the full details of the Fiscal Year 2026 Budget as there may be additional items that are of interest based on industry. Where applicable, employers should be prepared to update their policies and practices to ensure compliance with the new regulations.
Employers should also consult with legal counsel on the implications of these legislative changes and ensure compliance as needed.
