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LABOR LAW 198-B, WHICH PROHIBITS WAGE KICKBACKS, DOES NOT PROVIDE A FREESTANDING PRIVATE RIGHT OF ACTION (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Garcia, over an extensive two-judge dissent, determined Labor Law 198-b, which prohibits wage kickbacks, does not provide a freestanding private right of action:

Labor Law § 198-b prohibits “kickbacks” by making it unlawful for any person to “request, demand, or receive” part of an employee’s wages or salary on the condition that “failure to comply with such request or demand will prevent such employee from procuring or retaining employment.” Violation of the statute is a misdemeanor offense (see Labor Law § 198-b [5]). Labor Law § 218 also provides for administrative enforcement of section 198-b by the Commissioner of the Department of Labor. The statute empowers the Commissioner to grant affected employees restitution and liquidated damages in addition to imposing civil penalties. * * *

… [W]e apply a three-factor test to determine whether the legislative intent favors an implied right: “‘(1) whether the plaintiff is one of the class for whose particular benefit the statute was enacted; (2) whether recognition of a private right of action would promote the legislative purpose; and (3) whether creation of such a right would be consistent with the legislative scheme'” … . * * *

The statutory scheme … expressly provides two robust enforcement mechanisms, “indicating that the legislature considered how best to effectuate its intent and provided the avenues for relief it deemed warranted” … . Konkur v Utica Academy of Science Charter Sch., 2022 NY Slip Op 00911, CtApp 2-10-22

 

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