File #: Int 1182-2025    Version: * Name: Tip Theft Prevention Act.
Type: Introduction Status: Committee
Committee: Committee on Consumer and Worker Protection
On agenda: 2/13/2025
Enactment date: Law number:
Title: A Local Law to amend the administrative code of the city of New York, in relation to gratuities for tipped employees and providing options for conferring cashless gratuities at fast-food establishments and food service establishments
Sponsors: Shahana K. Hanif, Sandy Nurse, Carmen N. De La Rosa, Tiffany Cabán
Council Member Sponsors: 4
Summary: This bill adds protections for tipped workers against tip-based wage theft by their employers. Pursuant to this bill, employers would be required to disclose the daily amount of total compensation, amount of wages, amount of gratuities, aggregate amount of gratuities earned through cashless payments, and total amount of gratuities in the tip pool if the worker is part of a tip pool. The bill also creates additional administrative remedies and a private right of action. This bill also requires fast food and food service establishments to allow customers the option to confer a gratuity in same the manner that they paid for their food. Finally, this bill adds new terms and definitions to the Administrative Code’s Fair Work Practices subchapter.
Attachments: 1. Summary of Int. No. 1182, 2. Int. No. 1182, 3. February 13, 2025 - Stated Meeting Agenda

Int. No. 1182

 

By Council Members Hanif, Nurse, De La Rosa and Cabán

 

A Local Law to amend the administrative code of the city of New York, in relation to gratuities for tipped employees and providing options for conferring cashless gratuities at fast-food establishments and food service establishments

 

Be it enacted by the Council as follows:

 

Section 1. Section 20-1201 of the administrative code of the city of New York is amended by adding new definitions of “food service establishment,” “gratuity,” and “tipped employee” in alphabetical order to read as follows:

Food service establishment. The term “food service establishment” means a place where food is provided for individual portion service directly to the consumer whether such food is provided free of charge or sold, and whether consumption occurs on or off the premises or is provided from a pushcart, stand or vehicle.

Gratuity. The term “gratuity” means money given by a customer to an employee for service provided to the customer. Such term includes money given by cash, check, debit card, credit card, or any other form of payment.

Tipped employee. The term “tipped employee” means an employee engaged in an occupation in which employees customarily receive more than $30 a month in gratuities, regardless of whether the individual employee necessarily receives $30 in gratuities in any given month.  

§ 2. Subdivision a of section 20-1208 of the administrative code of the city of New York, as amended by local law number 2 for the year 2021, is amended to read as follows:

a. For violations of this chapter, the department may grant the following relief to employees or former employees:

1. All compensatory damages and other relief required to make the employee or former employee whole;

2. Any order directing compliance with the notice and posting of rights and recordkeeping requirements set forth in sections 20-1205 and 20-1206; and

3. For each violation of:

(a) Section 20-1204,

(1) Rescission of any discipline issued, reinstatement of any employee terminated and payment of back pay for any loss of pay or benefits resulting from discipline or other action taken in violation of section 20-1204;

(2) $500 for each violation not involving termination; and

(3) $2,500 for each violation involving termination;

(b) Section 20-1221, $200 and an order directing compliance with section 20-1221;

(c) Section 20-1222, payment of schedule change premiums withheld in violation of section 20-1222 and $300;

(d) Section 20-1231, payment as required under section 20-1231, $500 and an order directing compliance with section 20-1231;

(e) Section 20-1241, $300 and an order directing compliance with section 20-1241;

(f) Subdivision a of section 20-1251, the greater of $500 or such employee's actual damages;

(g) Subdivisions a and b of section 20-1252, $300; [and]

(h) Subdivision a or b of section 20-1262, $500 and an order directing compliance with such subdivision, provided, however, that an employer who fails to provide an employee with the written response required by subdivision a of section 20-1262 may cure the violation without a penalty being imposed by presenting proof to the satisfaction of the department that it provided the employee with the required written response within seven days of the department notifying the employer of the opportunity to cure; and

(i) Section 20-1281, an order directing compliance with such section and payment of the greater of $150 or the total amount of undisclosed gratuities earned during the reporting period.

§ 3. Subdivision a of section 20-1211 of the administrative code of the city of New York, as amended by local law number 2 for the year 2021, is amended to read as follows:

                     a. Claims. Any person, including any organization, alleging a violation of the following provisions of this chapter may bring a civil action, in accordance with applicable law, in any court of competent jurisdiction:

                     1. Section 20-1204;

                     2. Section 20-1221;

                     3. Subdivisions a and b of section 20-1222;

                     4. Section 20-1231;

                     5. Subdivisions a, b, d, f and g of section 20-1241;

                     6. Section 20-1251;

                     7. Subdivisions a and b of section 20-1252; [and]

                     8. Section 20-1272[.];

                     9. Section 20-1281; and

                     10. Section 20-1282.

§ 4. Subdivision b of section 20-1211 of the administrative code of the city of New York, as added by local law number 107 for the year 2017, is amended to read as follows:

b. Remedies. Such court may order compensatory, injunctive and declaratory relief, including the following remedies for violations of this chapter:

1. Payment of schedule change premiums withheld in violation of section 20-1222;

2. An order directing compliance with the recordkeeping, information, posting and

consent requirements set forth in sections 20-1205, 20-1206 and 20-1221;

3. Rescission of any discipline issued in violation of section 20-1204;

4. Reinstatement of any employee terminated in violation of section 20-1204;

5. Payment of back pay for any loss of pay or benefits resulting from discipline or other

action taken in violation of section 20-1204;

6. Other compensatory damages and any other relief required to make the employee whole; [and]

 7. Payment of the greater of $150 or the total amount of undisclosed gratuities

earned during each reporting period for a violation of 20-1281;

                        8.  An order directing compliance with the method of payment requirements in section 20-1282; and

9. Reasonable attorney's fees.

§ 5. Chapter 12 of title 20 of the administrative code of the city of New York is amended by adding a new subchapter 8 to read as follows:

SUBCHAPTER 8

GRATUITIES

§ 20-1281 Disclosure of certain gratuities required. a. Each employer of a tipped employee shall provide each such employee with a written or electronic copy of their daily individualized gratuity report for each day on which the tipped employee worked for such employer. The report shall include:

1. The total amount of compensation earned by such tipped employee for the day, disaggregated by wages and gratuities;

2.  The aggregate amount of gratuities for the day earned by such employee that were paid by a customer using cashless payments; and

3. If the tipped employee is part of a tip pooling arrangement, the total amount of gratuities in the tip pool for that day.

b. An employer shall provide a tipped employee with such report no later than the first day in which business operations are conducted after such compensation and gratuities were earned.

§ 20-1282 Method of paying gratuities. Each fast food establishment and food service establishment employing tipped employees shall provide a means to allow customers to provide such employees with a gratuity using the same method of payment the customer used to pay for the food purchased. If a fast food establishment or food service establishment allows customers to pay for food by cashless payment, such establishment must provide customers with preset gratuity options, in amounts to be determined by the fast food establishment or food service establishment but including at least 1 option that is at least 20 percent of the amount paid by the customer.

§ 6. This local law takes effect 120 days after it becomes law.

DPM /RL

LS #9081

1/17/2025 11:54 AM