Penalties

An employer that willfully violates the Fair Play Act by failing to properly classify its employees will be subject to civil penalties of up to a $2,500 fine per misclassified employee for a first violation and up to $5,000 per misclassified employee for a second violation within a five-year period [Labor Law § 861-e(3)].

Employers also may be subject to criminal prosecution (a misdemeanor) for violations of the act with a penalty of up to 30 days in jail, up to a $25,000 fine and debarment from Public Work for up to one year for a first offense. Subsequent misdemeanor offenses would be punishable by up to 60 days in jail, up to a $50,000 fine and debarment from performing Public Work for up to five years [Labor Law § 861-e(4)].

Employers also remain subject to all of the existing penalties, contributions, and restitution for Labor Law, Workers’ Compensation Law, and Tax Law violations that result from the worker misclassification [Labor Law § 861-e(6)].

Corporate officers and certain shareholders may be personally liable for the fines and penalties under the Act, where they knowingly permit the violations to occur [Labor Law § 861-e(5)].