New York’s Spread of Hours: What Employers Need to Know

When managing a business in New York, compliance with state-specific labor laws is crucial. One rule that employers often overlook is the “Spread of Hours”. This law is unique to New York and mandates additional compensation for employees under specific circumstances that we will review in this post.

For businesses aiming to stay compliant, you’ll learn everything you need to know about this important wage and hour rule.

What is the Spread of Hour Rule?

The New York State Spread of Hours (or split shift) rule applies to non-exempt employees whose workday stretches over ten hours, from the start of their first shift to the end of their last.

This timeframe includes all hours worked, as well as any breaks or off-duty time between shifts. If an employee’s workday exceeds 10 hours in total, they are entitled to one extra hour of pay at the local minimum wage rate, regardless of their regular hourly rate.

Let’s break this down: Your employee works from 9:00am to 1:00pm (4 hours), takes a break (4 hours), and then resumes work from 5:00pm to 8:00pm (3 hours), their workday is a total of 11 hours. Under the Spread of Hours rule, they must receive an additional hour of pay at the minimum wage*. If their day was 12 hours, they'd receive two hours of pay at minimum wage.

*In New York, the minimum wage is $15/hours in the majority of the state.

What You Should Keep in Mind

Spread of Hours vs. Overtime Pay
The Spread of Hours rule is different from overtime laws. It’s not tied to the total number of hours worked, but rather to the span of the workday. Employers must pay this additional compensation even if the employee’s total hours worked for the day do not exceed eight.

The Hospitality Industry
The rule is particularly common in the hospitality sector, where split shifts happen based on dining schedules. Restaurants, hotels, and catering businesses often require employees to work a breakfast or lunch shift, take a break, and return for dinner service. Employers in these industries should be proactive about tracking hours to ensure compliance.

This is where a timekeeping software can help!

Minimum Wage Basis
The additional hour of pay is calculated at the applicable minimum wage for the jurisdiction where the employee works.  Please note - even if an employee earns above the minimum wage, the Spread of Hours payment is based solely on the minimum rate.

Recordkeeping is Essential
Employers must maintain accurate records of hours worked, including breaks and split shifts. Detailed documentation is critical for proving compliance during audits or in the event of legal disputes. Timekeeping software, like Megapay, can simplify this process by automatically tracking hours.

Consequences of Non-Compliance
Violating the Spread of Hours law can result in costly fines, penalties, or even class-action lawsuits. In Long Island, a family owning 6 restaurants paid $1.2 million in damages after failing to compensate employees for extended workdays.

Simplify Compliance with Megapay

Navigating New York’s unique labor laws can be challenging, but compliance is non-negotiable. Investing in timekeeping and payroll solutions can save businesses significant time, money, and stress. MegaPay’s timekeeping tools and payroll software are designed to help New York businesses stay ahead of labor law requirements.

Introducing Megapay’s Fractional HR Service

For small teams needing expert guidance without the cost of a full-time HR department, Megapay now offers Fractional HR Services. This solution provides personalized support with unlimited HR expertise to help you navigate the questions of your employees and to help keep you compliant!

Let us handle the complexities so you can focus on growing your business!

Stay compliant, protect your business, and keep your team happy with Megapay’s comprehensive payroll and HR solutions.

Ready to get started? Contact us today to learn more.