Relates to the prompt payment of employees and contractors engaged in private construction projects

Title of bill

An act to amend the labor law and the general business law, in relation to the prompt payment of employees and contractors engaged in private construction projects

Purpose

This bill amends New York's labor law and prompt pay law to ensure greater enforcement mechanisms are available for employees, contractors and subcontractors.

Summary of provisions

This bill amends Section 196-a of the labor law by adding a new subdivision (ii) which allows an employee, contractor or certified collective bargaining agent to complain to the commissioner of Labor regarding a violation or potentially imminent violation of article 6 of the labor law.

This bill also amends 756 section (1) of the general business law by lowering the aggregate cost threshold for private construction projects from two hundred fifty thousand dollars to one hundred fifty thousand dollars; lowering the aggregate size threshold for residential construction projects from 9,000 square feet to 4,500 square feet or less; and lowering the size of applicable residential public housing units from 150 to 75 units.

This bill amends 756-a section (1) by changing the billing cycle to be the calendar month within which the work is performed unless otherwise stipulated by a construction contract.

This bill amends 756-b by allowing contractors the use of arbitration as a permissive remedy for non-payment.

The bill amends 756-b by adding a new section (3) that creates a system of protocols for the use of arbitration in scenarios of non-payment.

This bill amends 757 by adding a new section (3) and (4) relating to the void provisions of construction contracts and adding new language pertaining to the use of arbitration.

Justification

This bill is necessary to ensure that Payments required by construction contracts are made in a timely manner. Failure to pay in a timely manner often jeopardizes the operations of contractors, subcontractors and material suppliers and places the wages, benefits and jobs of employees at risk.

Legislative history

2008 Session: A.11520 - John - Reported to Codes Committee

Fiscal implications

None.

Local fiscal implications

None.

Effective date

Immediately and applies to construction contracts entered into after the bill becomes law and for contract entered into prior to the effective date for which permit or permits have been issued and work has begun.