Guarantee Car Wash Minimum Wage

"Car wash worker" means any employee in a city with a population of one million or more primarily engaged in the washing, vacuuming or general cleaning of motor vehicles. "Car wash worker" shall not include volun- teers engaged in the washing of cars for fund raising or other charita- ble purpose.

§ 2. Section 652 of the labor law is amended by adding a new subdivision 7 to read to follows:

Notwithstanding any provision of this article relating to the inclusion of an allowance for gratuities in the determination of the minimum wage, an employee who is a car wash worker in a city with a population of one million or more shall receive the minimum wage set forth in subdivision one of this section with no such allowance for gratuities.

Existing law

Car wash workers are among the "tipped workers" that have a base pay of less than the minimum wage. Their tipped wage is set under NYS DOL Miscellaneous Industries wage Order Currently, in the City of New York the current minimum wage is $10.50/hour for businesses with 10 workers or less, and $11/hour for 11 workers or more. For car wash workers in NYC, the tipped minimum wage could be either $7.95 or $8.90 for busi- nesses 10 or less workers, and $9.35 or $8.30 for businesses of 11 or more.

Justification

Since the minimum wage has been increased and will continue to increase in NYC to $15 in December of 2018, it is hard to fathom that there are people out there attempting to survive off less than the state's mini- mum, in areas where even minimum wage jobs may cause homelessness and hunger.

These examples from employees of this industry tell the story of why these individuals who need the protection of law:

Eight workers at the Vegas Auto Spa on Seventh Ave. in Park Slope say they were paid less than minimum wage - sometimes as little as $4.50 an hour - and didn't get overtime for working as much as 90 hours a week ( NY Daily News 10/7/14)

"On busy days we wash between 500 and 800 cars," he says. "I used to work 60 to 84 hours a week, seven days a week, at least 12 hours a day. When I first started at Hi-Tek in 2008, I made $5 an hour, flat, plus tips. In 2010, it was raised to $5.50 and in January of this year, it went up to $5.65. Until January, we never got paid overtime. We don't get paid holidays, vacation, or sick days. We rarely get more than a couple of minutes to eat lunch, have coffee or a snack. On a good day I get $30 in tips but most days I get only $10 ( Brooklynrail.org - 09/3/12)

Former Carwasher at Hi-Tek for five years but left this March because he couldn't make ends meet earning $5.25 an hour with little tips. (Nycom- munities.org 06/27/12)

Broadway Bridge Car Wash Some of the workers earned as little as $3.75 an hour when the minimum wage was $6.75 and $4.00 when it was $7.15. They took home as little as $270 a week and were often forced to share tips with non-service employees. http://www.crainsnewyork.com/)

Additionally, according to a 2014 report by the Labor Bureau of Attorney General Schneiderman's office. The Bureau has pursued these wage theft complaints in the cash wash industry, securing $2,425,000 in restitution for 1,018 car wash workers and $1,782,493.84 in restitution and penal- ties for the state. In one egregious case, the car wash owner was sentenced to jail time.

Cases in the car wash industry include:

A settlement of almost $4 million with the Lage and Magalhaes Car Wash chains. These chains, which share overlapping ownership, cheated an estimated 1,000 car wash workers out of their legally owed wages, underreported employees on state unemployment insurance returns and failed to carry required workers' compensation insurance for all employ- ees. Attorney General Schneiderman secured $2.2 million in restitution for the workers, more than $513,000 for the New York State Department of Labor's Unemployment Insurance Division, and nearly $1.2 million in penalties for the New York State Workers' Compensation Board.

Two criminal prosecutions of car wash owners, one in the Bronx and one in Suffolk County. The Bronx owner was sentenced to jail time and ordered to pay $150,000 in restitution to workers, $52,493.34 to the New York State Unemployment Insurance Fund, and $30,000 to the New York State Workers' Compensation Board. The Long Island car wash owner also pled guilty and was ordered to pay $75,000 in restitution to his work- ers.

Legislative history

2017-18: S.2664 / A.10612

Fiscal implications

None

Local fiscal implications

None

Effective date

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