Posts tagged ‘minimum wage’

Levy and Restraint Protocols Impacted by NY’s Minimum Wage

Your faithful blogger has just turned the heat on meaning that fall has officially arrived and it’s a good time to remind you of the impact that New York’s minimum wage law has on your levy and restraint protocols.

In 2016 New York approved Legislation with the ultimate goal of phasing in a $15 state wide minimum wage.  But in order to account for regional differences, different regions of the state, New York City, Long Island and Westchester and Upstate were subject to different wage scales.  In addition, the state was given authority to scale back mandated wage increases depending on their economic impact.  On September 22, the Division of the Budget released the mandated regional assessment and confirmed that the minimum wage will rise to $15 on Long Island and Westchester in 2022, joining New York City which already has a $15 minimum wage.  In contrast, the minimum wage for the “Upstate Area” will be $13.20 for the 2020 calendar year. 

Not only do these changes impact your credit union as a New York State employer, but it has an impact on your levy and restraint practices as well.  Under the Exempt Income Protection Act (EIPA) a minimum amount equal to 240 times of the state minimum hourly wage is exempt from levy and restraint.  As a result, in this 2017 guidance, DFS advised banks and credit unions “…that they should, to the extent practicable, calculate the exempt amount based on the account holder’s address and the size of the employer.  However, if, after reasonable due diligence, this information is unavailable, DFS has advised banks to exempt from collection an amount that corresponds to the highest minimum wage in effect in the State at the time of the calculation”, which is now going to be $15.

On that note, enjoy your weekend.

October 1, 2021 at 9:07 am Leave a comment

New York State Rings in the New Year With a Host of New Mandates

Welcome to the new decade, people.

While much has changed, much remains the same, which means that it is time for my annual blog highlighting some of the recent developments that will impact your credit union operations in the coming year.

NYS Issues LIBOR Preparedness Mandate

On December 23rd, New York’s Department of Financial Services Superintendent Linda Lacewell issued a homework assignment for all financial institutions regulated by the state. With the London Inter-Bank Offered Rate (LIBOR) to be phased out in 2021, DFS wants to make sure that all its regulated entities are preparing to shift away from using this rate. For credit unions, LIBOR would most commonly be used to establish baseline interest rates for floating loans. What makes New York’s guidance somewhat unique is that by February 7th, “the Department requires that each regulated institution submit a response to the Department describing the institution’s plan to address its LIBOR cessation and transition risk. The plan should describe (1) programs that would identify, measure, monitor and manage all financial and non-financial risks of transition, (2) processes for analyzing and assessing alternative rates, and the potential associated benefits and risks of such rates both for the institution and its customers and counterparties, (3) processes for communications with customers and counterparties, (4) a process and plan for operational readiness, including related accounting, tax and reporting aspects of such transition, and (5) the governance framework, including oversight by the board of directors, or the equivalent governing authority, of the regulated institutions.” I will be following up with a more detailed blog on this subject in the coming days.

New Minimum Wage

Speaking of New York State, January 1 also marks the date for further increasing New York’s minimum wage rate. I’ll leave this one to the experts. Here is a link to the Bond Schoeneck & King labor law update. I also like to remind people that because New York’s minimum wage varies by region, it also impacts the amount of money that can be restrained. Here is guidance DFS released on this issue in 2017. Remember that this impacts your credit union whether you are state or federally chartered.

New York Further Complicates Foreclosures

In the closing days of the year, the Governor signed important legislation impacting New York’s byzantine foreclosure process. One bill, S5160, provides that a plaintiff’s lack of standing in a foreclosure action is not waived if the defendant homeowner fails to raise the defense in responding to the initial foreclosure papers. This is a big deal because it means that there will be even more uncertainty and delay when foreclosing on property in New York.

This was not the only bill dealing with foreclosure that the Governor gave his blessing to. He also signed off on a bill which shortens the redemption period for the payment of taxes on vacant and abandoned property. Take a close look at this bill.

Another Important HR Bill

As you can see, the Governor was busy over the holiday season. He also signed another important HR bill designed to ensure equal pay for civil servants  in protected classes. Although this does not apply to your credit union, it  is part of a larger framework in which all NY employers should be taking  a more systemic approach to analyzing wage discrepancies within their own organizations.

January 2, 2020 at 9:24 am 1 comment

Tough Times Continue For NYC Medallions

imagesCAYI602KThese are turbulent times for NYC’s taxi medallion industry .

There were several foreclosures and transfers in May and June with one medallion going for as low as $405,000 and another selling for $610,000.  Remember that  this is an industry where, until a couple of years ago,  foreclosures were as rare as a show of humility by Donald Trump.

Keith Leggett predicted in his Credit Union Watch blog that   “These transactions indicate that credit unions with New York City taxi medallion loans will likely see an increase in delinquencies, troubled debt restructured loans, and charge-offs.”     We really won’t know the full extent of the damage until we know whether or not  medallion prices are at their nadir.  Stay tuned

NY Fine tunes Direct deposits  You may want HR to take a look at regulations proposed by NYS’s Department of Labor addressing , among other things, the use of Direct Deposit by employers

Fed OK’s KeyCorp\First Niagara Merger

The inevitable consolidation of the financial services industry is on track to continue as the Federal Reserve Board approved the merger of Buffalo based  First Niagara into Ohio based KeyCorp.

Two days ago Bloomberg news reported that Senator  Schumer,  who had expressed reservations about the merger, signaled he was no longer opposed after KeyCorp  agreed  to cut no more than 250 jobs and to hire at least 500 people in the next three years.   The deal will make KeyCorp the 26th largest bank in the US and will have a direct impact on New York.  The Albany Times Union reported that the merger will result in the closure of  30 branches  with 18 closing as early as  October .

By the way, in reviewing the impact that the merger would have on financial services in the Buffalo area the Fed noted that “nine credit unions exert a competitive influence in the Buffalo market. Each institution offers a wide range of consumer banking products, operates street-level branches, and has broad membership criteria that include almost all of the residents in the market.”

So let me get this straight. According to the Banking industry, Credit union competition is a  bad thing which is why, for instance, NY municipalities shouldn’t be allowed to  place taxpayer money in credit unions;  but if it  helps banks become larger, credit union competition is  a good thing. Got it.

Just how much money will those 250 new  employees be making? JP Morgan CEO Jamie Dimon announced Tuesday that the bank  would be raising the minimum salary of its employees from $12 to $16.50 an hour depending on where they  work.  Dimon explained that “Wages for many Americans have gone nowhere for too long.”  What a guy!

Score on for Bernie Sanders on this one.

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July 13, 2016 at 9:14 am Leave a comment

How New York’s Minimum Wage Law Affects Your Credit Union

On December 31st, New York’s minimum wage increased to $8.00 an hour. Even if you pay your employees more than this minimum, your credit union’s operations have been directly affected by this increase whether or not you realize it.

New York law exempts an amount equal to 240 times the state or federal minimum wage — whichever is higher — from levy and restraint. Remember, this is a baseline number for those members who don’t have exempted funds electronically deposited into their account. That number is adjusted for inflation every three years. This means that as of December 31st, members have at least $1,920 exempt from a restraining or levy notice.

I haven’t seen any official notice on this increase from the Department of Financial Services, but something tells me that you will have impacted members cognizant of this increase irrespective of whether or not New York State gets the word out. As I have said in previous blogs, New York’s levy and restraint exemptions are very often the subject of compliance inquiries. This is, in part, a reflection of the fact that they impact both state and federal credit unions, but mainly because, as a review of the statute will indicate, there are different trip wires for your credit union to keep in mind whenever the collector comes calling.

On that note, your faithful blogger, who stayed up a little too late watching the Auburn-Florida State Game last night, wishes you all a pleasant day.

January 7, 2014 at 7:31 am Leave a comment

How Much Do You Pay Your Tellers?

Don’t be surprised if someone asks you that question in the coming days. The Washington Post reports that the Berkeley Labor Center will release a study today critical of the wages paid to bank tellers. According to the report, nearly a third of the country’s half million bank tellers rely on some kind of financial assistance to get by to the tune of nearly $900 million a year in public benefits including food stamps, the earned income tax credit and Medicaid/Child Health Insurance Program. The report is going to have particular prominence here in New York where it will be used by labor groups pushing for higher wages.

The minimum wage is getting a lot of attention lately. For instance, our good friends on the opposite coast in Seattle are actually arguing for a $15 minimum wage. Economists have spent years debating what effect, if any, increases in the minimum wage have on the economy and the debate won’t end any time soon. But the simplest solutions are rarely the best ones. No matter what the economists argue, it is foolishly simplistic to think that the key to helping people make a living is to have government determine a living wage. There are just too many moving pieces when it comes to figuring out how much people need to make ends meet.

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Did I ever mention that Jocoby Ellsbury was my favorite Red Sox player?

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Here’s one for your hard-core compliance people: Yesterday, FinCEN released regulations finalizing the definitions of transmittal of funds and fund transfers in the Bank Secrecy Act. The regulations were required by amendments to the Electronic Funds Transfer Act related to protections for consumers who send remittance transfers. The final regulations clarify that the new remittance transfer requirements do not require expanded record keeping requirements under the BSA.

December 4, 2013 at 8:23 am Leave a comment


Authored By:

Henry Meier, Esq., Senior Vice President, General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association. In addition, although Henry strives to give his readers useful and accurate information on a broad range of subjects, many of which involve legal disputes, his views are not a substitute for legal advise from retained counsel.

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