Easily manage employment in New York

Payroll management in New York

New York has a diverse economy supported by industries such as finance, healthcare, technology, and entertainment. With state-specific payroll regulations, including one of the highest minimum wages in the U.S., progressive income tax rates, and mandatory paid leave, employers in New York must ensure compliance with both state and federal payroll laws. Understanding these regulations is crucial for smooth payroll operations and compliance.

Payroll breakdown in New York

Employers in New York must adhere to both federal and state payroll regulations regarding wages, taxes, and benefits. Below is an overview of key payroll components:

Minimum wage and overtime

• Minimum wage: New York’s minimum wage varies by location:
• $16.00 per hour in New York City, Long Island, and Westchester County.
• $15.00 per hour in the rest of the state.
• Some industries, such as hospitality and fast food, have higher wage requirements.
• Overtime rules:
• New York follows federal overtime laws, requiring employers to pay 1.5 times an employee’s regular rate for hours worked beyond 40 hours in a workweek.
• Some exemptions apply based on job classification and industry.

State income tax

• New York has a progressive state income tax system, with rates ranging from 4% to 10.9%, depending on income levels.
• New York City also imposes a local income tax ranging from 3.078% to 3.876% for residents.
• Employers must withhold state and local income taxes and remit them to the New York State Department of Taxation and Finance.

Unemployment insurance (UI) tax

• Employers must contribute to New York’s Unemployment Insurance (UI) program, managed by the New York State Department of Labor.
• The UI wage base in New York is $12,500.
• UI tax rates vary based on an employer’s experience rating and range from 2.1% to 9.9%.
• New employers typically pay a 3.4% UI tax rate.

Workers’ compensation

• New York law requires all employers to carry workers’ compensation insurance to cover medical expenses and lost wages for employees injured on the job.
• Some exemptions apply, including certain independent contractors.

Paid family and medical leave

• New York Paid Family Leave (PFL): Employees are eligible for up to 12 weeks of paid leave to care for a family member, bond with a new child, or handle matters related to military service.
• Temporary Disability Insurance (TDI): Employees may receive cash benefits for non-work-related injuries or illnesses.
• Employers must withhold contributions from employee wages and remit payments to the New York State Insurance Fund (NYSIF) or a private insurer.

Payroll tax filing and payment deadlines

• Employers must register for a New York Employer Identification Number (EIN) with the New York State Department of Taxation and Finance.
• State and local withholding tax returns must be filed monthly, quarterly, or annually, depending on employer classification.
• UI tax reports must be submitted quarterly to the New York State Department of Labor.
• Payroll tax payments can be made electronically through the New York State Tax Department’s Online Services Portal.

Quick facts: Important considerations for employers

• State minimum wage compliance: New York’s minimum wage is higher than the federal rate, and employers must comply with state and local laws.
• Final paycheck rules:
• If an employee is terminated or resigns, employers must provide the final paycheck by the next scheduled payday.
• New hire reporting: Employers must report new hires to the New York State Directory of New Hires within 20 days.
• Paid sick leave: New York requires employers to provide one hour of sick leave for every 30 hours worked, up to 40 or 56 hours per year, depending on company size.
• Payroll recordkeeping: Employers must maintain payroll records for at least six years to comply with state and federal laws.
• Right-to-work state: New York is not a right-to-work state, meaning employees may be required to join a union if applicable.

Run payroll in New York with Remote

Managing payroll in New York requires careful attention to state-specific regulations, including minimum wage compliance, UI tax requirements, and workers’ compensation laws. Employers must stay informed about tax rates, wage laws, and reporting deadlines to ensure smooth payroll processing and avoid penalties.

The good news is, you can pay anyone, anywhere — from your team in the office to your team abroad, all with Remote Payroll. To see just how easy global payroll can be, book a demo with Remote today.