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New York Expands Prevailing Wage Yet Again: What You Need To Know And When You Need To Know It

Written by Gregory J. Spaun on . Posted in Legal Alerts.

In recent years, New York State has steadily expanded the scope and administrative burden of prevailing wage compliance. What was once limited to traditional public works has now crept into private projects receiving public benefits, hauling operations, renewable energy projects, and—most recently—offsite fabrication and concrete and asphalt trucking. Contractors and subcontractors should understand that these changes are not academic. They carry real pricing, payroll, registration, and audit risks, particularly for those operating in or around New York City and its surrounding counties.

Contractors may recall that in 2022 Governor Hochul signed legislation to require contractors and subcontractors bidding or working on prevailing wage projects to register with the Department of Labor as public works contractors, effective December 30, 2024. This legislation also required that effective that same date, contractors working on public works and covered private projects would also have to submit their certified payroll documents electronically to the DOL. The effective date of the certified payroll filing requirement was pushed back a year to give the DOL adequate opportunity to set up a portal to receive such required information. That portal is now online, and the DOL’s user guide to the portal is available here or go to: https://dol.ny.gov/system/files/documents/2025/12/certified-payroll-contractor-user-guide-12-19-2025.pdf. You can also learn more about the specifics of this subject by registering for our upcoming webinar on this subject here or go to: https://wbgllp.com/wbg-event/new-york-expands-prevailing-wage-yet-again-what-you-need-to-know-and-when-you-need-to-know-it.

Contractors that fail to timely register or electronically submit certified payrolls risk payment delays, debarment, and other enforcement actions by the Department of Labor.

While the industry has had some advance warning of the electronic certified payroll filing requirement, what is new is the expansion of prevailing wage to the offsite fabrication of materials to be installed at a public works project awarded after June 16, 2026 (the statute here limits the application of this provision to “traditional ” prevailing wage projects for public entities, and not private projects receiving government benefits). This requirement applies to materials “solely and specifically designed and engineered for installation in the construction, repair or renovation of a building which is the subject of a contract” with a municipal entity. The intent of this statute is to ensure that workers in fabrication shops making, for example, ductwork for inclusion in public works projects get paid prevailing wage (the rate for which is calculated at the worksite, and not at the offsite facility). While some offsite materials (such as, again, ductwork) will clearly fall into this definition because they are manufactured to unique specifications, that line will be blurred with other materials, such as HVAC equipment, that may start as largely “off the shelf” equipment and require little alteration for use in the public works project, but which are still not “plug-and-play”. Other complications are that this law applies not only to New York operations, but also to operations outside of New York State (and, in fact, the United States), and such fabricators have to register with the DOL as public works contractors. Upstream contractors will no doubt have issues with having that window manufacturer in Henan Province register with the DOL (and, even if they can overcome this hurdle, how do you calculate prevailing wage in Chinese Yuan?). However, even if you’re in contract with, for example, a sheetmetal contractor which is already registered as a public works contractor and which has its own fabrication shop, how is that contractor to segregate its work into prevailing wage and non-prevailing wage work? After all, a 10 foot length of 12 inch duct is the same regardless of whether that item goes into a school building or an office building, and for efficiencies of scale these items are routinely made side by side at the same time. Unfortunately, all that we can say at this point is to stay tuned for developments from the DOL has to how they intend to enforce these requirements (which, clearly, are going to be an administrative headache for contractors).

Finally, in building upon the requirement to pay prevailing wage to truckers who are hauling aggregate (which ushered in DOL’s infamous “50 mile radius” rule), the legislature has determined that any trucker hauling concrete and asphalt (which are not covered as “aggregate” in the older statute) to or from any worksite in New York City or Nassau, Suffolk, Westchester, and Putnam Counties pay prevailing wage to its truckers either delivering to or returning from such worksites, and also for their time in loading and unloading. Contractors should expect these requirements to materially impact trucking rates and should address compliance responsibility expressly in their contracts and bid assumptions.  Similarly, it is not yet known whether DOL will impose its 50-mile radius requirement on this new law.

At present, these statutes leave significant unanswered questions regarding enforcement, valuation, and segregation of covered work. Additional guidance from the DOL, or the courts, is expected, but contractors should assume aggressive enforcement. Accordingly, contractors should review their subcontract terms, supplier agreements, and bid pricing now to allocate prevailing wage risk appropriately before these provisions take effect.

For a deeper discussion of these changes and practical compliance strategies, we invite you to attend our upcoming webinar on this topic on Wednesday, January 14, 2026 at 11:00 a.m. While contractors were aware of the registration requirement since 2024, and the follow-on requirement to submit certified payrolls on prevailing wage projects directly to the Department of Labor in electronic format coming into effect with the New Year, the State Legislature has been busy adding to that burden in the form of imposing additional prevailing wage requirements on the hauling of concrete and asphalt in the Downstate region, and on the off-site custom fabrication of materials for installation on a prevailing wage project. The Department of Labor has also been busy setting up, and finally opening, the portal where these certified payrolls are to be submitted. Sign up for this informative webinar so that you’re up to date on the latest developments. Please register here or go to https://wbgllp.com/wbg-event/new-york-expands-prevailing-wage-yet-again-what-you-need-to-know-and-when-you-need-to-know-it. In the interim, please contact Gregory J. Spaun, Esq. at gspaun@wbgllp.com or (914) 607-6425 with any questions.

If you would like more information regarding this topic please contact Gregory J. Spaun at gspaun@wbgllp.com or call (914) 607-6425

New York State Implements “Gender-Based Violence and the Workplace” Certification Requirement for Bidders

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

Beginning November 5, 2025, all entities submitting competitive bids to New York State, including bids to any state department, agency, or public authority, must certify that they have adopted and implemented a written “Gender-Based Violence and the Workplace” policy.

This requirement stems from the addition of Section 139-m to the New York State Finance Law, enacted as part of the FY 2025–2026 State Budget, and cross-references Executive Law §575(11), which directs the Office for the Prevention of Domestic Violence (OPDV) to publish model policies and guidance for employers.

Who Must Comply

The certification requirement applies to:

  • Any competitive procurement issued on or after November 5, 2025; and
  • All bidders seeking to perform work, provide services, or sell goods to the State or any public department or agency.

It does not apply to existing contracts or to procurements issued before November 5, 2025.

Certification Requirement

Each bidder must include in its proposal the following affirmed statement, subscribed under penalty of perjury:

“By submission of this bid, each bidder and each person signing on behalf of any bidder certifies … that the bidder has and has implemented a written policy addressing gender-based violence and the workplace and has provided such policy to all of its employees, directors and board members. Such policy shall, at a minimum, meet the requirements of subdivision 11 of section 575 of the executive law.”
— N.Y. State Finance Law §139-m(1)(a)

Failure to provide this certification will render a bid ineligible for award.

Minimum Policy Requirements

To comply, an employer’s written policy must include, at minimum:

  1. Employee Information & Awareness
    • Provide employees with information about gender-based violence and available resources.
    • Display the New York State Domestic and Sexual Violence Hotline number and the official workplace poster.
  2. Referral to Support Services
    • Require referral of employees who disclose current or past victimization to the State Hotline or, for out-of-state employers, to a comparable local provider.
    • Hotline: 1-800-942-6906 | Text: 844-997-2121 | Chat: opdv.ny.gov
  3. Non-Discrimination & Non-Retaliation
    • Prohibit discrimination or retaliation against employees who identify as victims or survivors of gender-based violence.
  4. Compliance with Applicable Law
    • Ensure alignment with other New York laws, including the New York State Human Rights Law and all related labor and employment statutes.
  5. Implementation Support
    • Inform Human Resources and supervisory staff of implementation resources and training available from the Office for the Prevention of Domestic Violence (OPDV).

Practical Next Steps for Employers

  • Draft or adopt a compliant policy. Employers may develop their own written policy or adapt the forthcoming OPDV model policy once issued.
  • Distribute and post the policy. It must be provided to all employees, directors, and board members and prominently displayed at worksites.
  • Integrate certification into bid procedures. Procurement departments and compliance officers should update internal checklists to ensure the certification accompanies every State bid submitted on or after November 5, 2025.
  • Train HR and supervisory staff. Ensure familiarity with the referral process and OPDV guidance.

Failure to have and certify a compliant policy will disqualify a bid from consideration. Entities seeking to do business with New York State must act promptly to implement and document compliance before submitting any bid after November 5, 2025.

Welby, Brady & Greenblatt, LLP can assist with drafting, implementing, and certifying a Gender-Based Violence and the Workplace Policy consistent with these new statutory requirements.

If you would like more information regarding this topic please contact Thomas S. Tripodianos at ttripodianos@wbgllp.com or call (914) 607-6440

Supreme Court Rules that Mechanic’s Lien is Void Due to Willful Exaggeration and Homeowners are Entitled to Damages

Written by WB&G on . Posted in Legal Alerts.

The lien law affords contractors a safeguard for payment in connection with the improvement of real property in the form of a mechanic’s lien, which can ultimately be foreclosed like a mortgage. This is separate from, and in addition to, any breach of contract or other claims that may be asserted against the non-paying owner or contractor in connection with the project. In the recent case of Gregory Allan Cramer & Co. Inc. v. Robert Edward Rescoe and Erin Stacy Rescoe, the Court also reminds us that the amount stated in the lien must not be willfully exaggerated. If a lien is found to have been willfully exaggerated, courts have authority to, among other things, void the lien and award statutory damages to property owners. Cramer also stands for the principle that a construction contract for a home improvement project can be deemed unenforceable if the contract is not compliant with applicable consumer protection statutes, or is ambiguous with respect to key provisions—such as the project completion date.

In Cramer, the Rescoes hired Cramer & Co. an interior designer and contractor, to renovate and furnish their home in Westchester County. The contract entitled Cramer & Co. to a 25% commission on the total net budget, and required them to provide detailed documentation for all goods and services. The Rescoes ultimately paid Cramer & Co. over $780,000, though the certificate of occupancy (CO) was never procured. A dispute arose over the final balance, which Cramer & Co. claimed to be $152,924.90. This was substantially more than the previously discussed remaining balance of $43,000.

The Rescoes alleged that the mechanic’s lien filed by Cramer & Co. was willfully exaggerated. In doing so, they cited discrepancies such as inflated invoices, missing receipts, and goods that did not constitute permanent improvements. The court noted that some items listed as “gifts” or “free of charge” were later included in the lien claim. The Rescoes also argued Cramer & Co.  failed to perform agreed work including, but not limited to, obtaining the CO. (The Rescoes also claimed that Cramer & Co. took affirmative steps with the village to impede the CO procurement process.)

The court found that Cramer & Co.’s testimony was not credible, and it determined that the lien was willfully exaggerated. The court also found that Cramer & Co. acted in bad faith and breached the contract by failing to complete the work, and by obstructing the CO process. Specifically, the record showed that the lien included items explicitly waived, or never agreed upon by and between the parties.

The court further rejected Cramer & Co.’s breach of contract claims due to its non-compliance with Section 771 of the General Business Law (which provides for certain requirements in home improvement contracts), lack of performance, and absence of agreed pricing or documentation. As a result, the court (i) declared Cramer & Co.’s  mechanic’s lien void due to its willful exaggeration; (ii) awarded the Rescoes  $109,924.77 in statutory damages (the difference between the lien amount and the previously agreed-upon balance), plus costs and prejudgment interest at 9%; and (iii) ordered Cramer & Co. to pay the Rescoes’ attorneys’ fees as the non-prevailing party under the contract.

This case underscores the importance of correctly identifying the amounts to be included in a mechanic’s lien filing, and the grave consequences of failing to do so. Additionally, the case reminds us that it is critical for home improvement contractors and owners to only enter into contracts that are compliant with Section 771 of the General Business Law, as well any local requirements.

If you would like more information regarding this topic please contact Andrew E. Zeyer at azeyer@wbgllp.com or call (914) 607-6485

New York City Enacts FARE Act: Landlords to Shoulder Broker Fees Starting June 2025

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

In a major shift for the New York City rental market, the City Council passed the Fairness in Apartment Rental Expenses Act (FARE Act) on November 13, 2024. This legislation, effective mid-June 2025, significantly alters who bears the cost of broker fees in residential leasing transactions.

Key Provision: Landlords Pay Broker Fees

The FARE Act mandates that when a landlord hires a broker to market or lease an apartment, the landlord—not the tenant—must pay the associated broker fee. This effectively ends the longstanding (and often criticized) practice of tenants covering broker costs, even when they had no role in engaging the broker.

Historically, these fees have ranged from 10–15% of annual rent. For a typical $3,000/month apartment, this could add more than $5,000 to a tenant’s upfront costs, on top of first month’s rent and security deposit.

Legislative Background

Sponsored by Council Member Chi Ossé, the FARE Act passed by a 42–8 margin, with supporters citing the financial strain broker fees impose on tenants—particularly those in low- and middle-income brackets. The legislation aligns New York City with other major cities, such as San Francisco and Boston, where broker fees are commonly paid by landlords.

Pushback and Litigation

Opposition came swiftly from the real estate industry. The Real Estate Board of New York (REBNY) has filed a federal lawsuit challenging the FARE Act, claiming it infringes on state law and brokers’ First Amendment rights. Industry groups also warn that landlords may recoup costs through higher monthly rents, undercutting the Act’s intended relief for tenants.

Implications for Stakeholders

  • Tenants should see reduced upfront costs when renting apartments where the landlord has retained a broker.
  • Landlords must now budget for broker commissions when using intermediaries, potentially impacting rent-setting strategies.
  • Brokers may need to adjust business models and expectations regarding fee recovery.

What’s Next?

With the law set to take effect in June 2025, landlords, brokers, and tenants should begin reviewing their leasing practices and form agreements. Industry participants are advised to monitor the ongoing litigation, which could impact enforcement or interpretation of the FARE Act.

For further guidance on how the FARE Act may affect your leasing strategy or contractual obligations, please contact us.

FinCEN Eliminates BOI Reporting Requirement for U.S. Companies and U.S. Persons

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

In a sweeping reversal of policy, the Financial Crimes Enforcement Network (FinCEN) announced today that it has issued an interim final rule eliminating the Beneficial Ownership Information (BOI) reporting requirement for all U.S. companies and U.S. persons under the Corporate Transparency Act (CTA).

This unexpected but significant shift aligns with the Department of the Treasury’s March 2, 2025 announcement and is effective immediately, ahead of its formal publication in the Federal Register.

Key Changes Under the Interim Final Rule

No More BOI Reporting for U.S. Entities FinCEN has revised the definition of “reporting company” to include only:

  • Entities formed under the laws of a foreign country, and
  • Registered to do business in any U.S. state or tribal jurisdiction by filing with a secretary of state or similar office (previously referred to as “foreign reporting companies”).

This means:

  • All entities created in the United States are now fully exempt from BOI reporting under the CTA.
  • U.S. persons will no longer be subject to any BOI disclosure obligations as beneficial owners.

New Rules for Foreign Entities

Entities formed outside the U.S. but registered to do business here may still be required to report BOI — but only if they do not qualify for one of the CTA’s existing exemptions. The new rules include the following deadlines:

  • Foreign Entity Status
  • BOI Filing Deadline
  • Registered before March 26, 2025
  • 30 days from March 26, 2025
  • Registered on or after March 26, 2025

30 days from notice that registration is effective Importantly, even for these foreign entities:

  • No U.S. persons need to report BOI as beneficial owners.
  • No Enforcement for Domestic Entities

FinCEN has clarified that:

  • It will not enforce any BOI-related penalties or fines against U.S. citizens, domestic reporting companies, or their beneficial owners.
  • All exemptions and deadline extensions in this interim final rule are considered effective immediately.

What This Means for You

This is a monumental rollback of the CTA’s original reach. Effective today:

  • U.S.-formed LLCs, corporations, and other domestic entities no longer need to file BOI reports.
  • U.S. individuals will not be treated as beneficial owners for any reporting purpose under the CTA.
  • Only foreign entities registered to do business in the U.S. — and not otherwise exempt — must comply with the CTA’s reporting obligations.

Next Steps:

If you previously began preparing BOI filings for U.S. entities or U.S. persons, those efforts can now be suspended. For clients with foreign entities operating in the U.S., we recommend a fresh review to determine if a reporting obligation still applies under the narrowed rule.

Please contact us with any questions or to reassess your CTA compliance strategy.

If you would like more information regarding this topic please contact Thomas S. Tripodianos at ttripodianos@wbgllp.com or call (914) 607-6440

New Law Expands Business Interruption Insurance Coverage and Accessibility

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

On May 17, 2024, the New York State Assembly passed Bill A10342, amending the state’s insurance law to authorize standalone business interruption insurance. On Sept. 27, 2024, Governor Kathy Hochul approved A.B. 10342.

This significant legislative change enhances the availability and scope of coverage for New York businesses, providing additional protection against unforeseen closures.

Key Provisions of the New Law

  1. Expanded Definition of Business Interruption Insurance
    • The law defines business interruption insurance to include coverage for losses arising from:
      • Property damage affecting insured or neighboring property.
      • Acts or threats of violence occurring on the business premises.
      • Government orders mandating closure.
  2. Standalone Policies Now Available
    • Previously, business interruption insurance was typically bundled with property insurance. Under the new law, businesses can now purchase standalone policies tailored specifically to their needs.
  3. Access to Excess Line Insurers
    • Licensed excess line brokers can now procure business interruption insurance from insurers not authorized to transact business in New York. This change broadens the market and increases options for businesses struggling to find coverage from in-state insurers.
  4. New Financial Requirements for Insurers
    • The law imposes minimum capital and surplus requirements for insurers offering standalone business interruption coverage, ensuring they have sufficient financial reserves to cover claims.

Implications for New York Businesses

  • Greater Access to Coverage: Businesses now have the flexibility to obtain business interruption insurance as a separate policy, allowing for more customized protection.
  • Enhanced Protection: The explicit inclusion of government-mandated closures and threats of violence as covered events resolves prior ambiguities that led to coverage disputes.
  • Potential Cost Adjustments: Insurers may increase premiums due to new financial requirements, and businesses should carefully evaluate coverage terms before purchasing policies.
  • Increased Availability: Businesses unable to secure coverage from traditional insurers may now obtain it from excess line insurers through licensed brokers.

Next Steps for Businesses

We recommend that New York businesses:

  • Review existing business interruption coverage to determine if standalone coverage provides additional benefits.
  • Consult with their insurance broker to explore policy options from both admitted and excess line insurers.
  • Assess risk exposure to ensure adequate protection against potential interruptions due to property damage, violence, or government-mandated closures.

If you would like more information regarding this topic please contact Thomas S. Tripodianos at ttripodianos@wbgllp.com or call (914) 607-6440

Stopping a Disloyal Employee: Temporary Restraining Orders and Injunctions

Written by Austin S. Brown on . Posted in Legal Alerts.

Introduction

Construction businesses rely on employee trust, but disloyal insiders can misuse confidential information to cause significant harm. When this happens, immediate action is crucial. This alert explains how contractors can use Temporary Restraining Orders (TROs) and Preliminary Injunctions to prevent further damage.

Obtaining a TRO and Preliminary Injunction

While lawsuits typically take time, TROs and Preliminary Injunctions provide swift relief by temporarily halting harmful actions. To secure this relief, courts require the following:

  1. Likelihood of Success: Strong evidence supporting your claims.
  2. Irreparable Harm: Damage beyond monetary loss, such as harm to reputation or trade secrets.
  3. Balance of Hardships: The harm to you outweighs the harm to the defendant.
  4. Public Policy: No broader societal harm results from the relief.

A TRO freezes harmful actions until a hearing, where the court decides on issuing a Preliminary Injunction. If granted, this remains in place until the lawsuit is resolved, potentially becoming permanent.

A Real-World Case

A construction manager discovered a project manager colluding with a subcontractor to manipulate bids. Evidence included suspiciously similar errors in competing bids and sudden email deletions by the project manager. The manager demonstrated irreparable harm, including potential reputational damage and liability for price-fixing. The court granted a TRO and later a Preliminary Injunction, stopping further misuse of insider information. The case resolved with a Permanent Injunction, avoiding prolonged litigation.

Best Practices

Confidentiality agreements can strengthen your case, as they simplify proving breaches of sensitive information. Contractors should consult experienced legal counsel to address such issues promptly and effectively.

If you would like more information regarding this topic please contact Austin S. Brown at abrown@wbgllp.com or call (914) 607-6435

Updated Beneficial Ownership Reporting Deadlines Following December 26, 2024 Court Decision

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

Fifth Circuit Lifts Suspension of District Court Injunction – CTA Reporting Requirements Not Currently Enforceable

The U.S. Court of Appeals for the Fifth Circuit has reinstated the district court’s preliminary injunction that temporarily halts the enforcement of the Corporate Transparency Act (CTA) reporting requirements. This decision reverses the Fifth Circuit’s earlier ruling on December 23, 2024, which had stayed the district court’s injunction and reinstated the CTA’s reporting requirements. The CTA’s obligations are, therefore, currently unenforceable pending further legal proceedings.

Key Developments

1. Nationwide Injunction Reinstated:

  • On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction in Texas Top Cop Shop, Inc. v. Garland, enjoining the nationwide enforcement of the CTA.
  • On December 23, 2024, the Fifth Circuit had stayed this injunction, briefly allowing the CTA’s reporting requirements to be enforced.
  • As of December 26, 2024, the Fifth Circuit has removed its stay, reinstating the district court’s injunction and rendering the CTA’s reporting requirements currently unenforceable.

2. Legal Context and Ongoing Challenges:

  • Several federal cases continue to challenge the constitutionality of the CTA. The Department of the Treasury and Department of Justice assert the CTA’s constitutionality, citing supporting decisions from other jurisdictions, such as the Eastern District of Virginia and the District of Oregon.
  • The National Small Business United v. Yellen litigation exempts specific plaintiffs from the CTA’s reporting requirements, including:
  • Isaac Winkles and entities where he is a beneficial owner.
  • Members of the National Small Business Association as of March 1, 2024.

3. Impact on Revised Deadlines:

  • The Department of the Treasury had previously extended reporting deadlines to January 13, 2025, and beyond for entities affected by the earlier stay. These deadlines are now subject to further uncertainty due to the reinstated injunction.

Action Items for Affected Entities

While the CTA’s enforcement is currently suspended, reporting companies should remain prepared for potential reinstatement of the reporting requirements. Consider the following steps:

  • Monitor Developments: Stay informed of updates from the courts and the Department of the Treasury regarding the CTA’s enforcement status.
  • Prepare Documentation: Continue gathering and verifying beneficial ownership information to ensure readiness for compliance should the injunction be lifted again.
  • Consult Legal Counsel: Seek guidance on how the reinstated injunction impacts your specific reporting obligations and deadlines.

Conclusion

The legal landscape surrounding the CTA remains fluid, with significant implications for reporting companies. Entities are encouraged to review their compliance strategies and remain vigilant for further developments. For assistance navigating the CTA’s requirements or understanding your reporting obligations, please contact our office.

If you would like more information regarding this topic please contact Thomas S. Tripodianos at ttripodianos@wbgllp.com or call (914) 607-6440

Updated Beneficial Ownership Reporting Deadlines Following December 23, 2024 Court Decision

Written by Thomas S. Tripodianos on . Posted in Legal Alerts.

On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit issued a decision that reinstates the Corporate Transparency Act (CTA) reporting requirements for most entities, following a stay of the preliminary injunction granted earlier this month. This decision has significant implications for reporting companies subject to the CTA’s beneficial ownership information (BOI) reporting requirements.

To accommodate reporting companies impacted by the legal uncertainties during the injunction period, the Department of the Treasury has announced revised deadlines for compliance. Below are the updated deadlines and key details.

Revised Reporting Deadlines

1. Entities Created or Registered Prior to January 1, 2024:

  • Deadline to file initial BOI reports extended to January 13, 2025 (previously January 1, 2025).

2. Entities Created or Registered Between September 4, 2024, and December 23, 2024:

  • If the filing deadline fell between December 3, 2024, and December 23, 2024, the deadline is extended to January 13, 2025.

3. Entities Created or Registered Between December 3, 2024, and December 23, 2024:

  • Entities have an additional 21 days from their original filing deadline to submit their initial BOI reports.

4.Entities Qualifying for Disaster Relief:

  • These entities may have further extended deadlines beyond January 13, 2025, as applicable.

5.Entities Created or Registered On or After January 1, 2025:

  • These entities must file initial BOI reports within 30 days of receiving actual or public notice of their creation or registration.

Exemptions for Specific Plaintiffs

Entities and individuals involved in the ongoing litigation in National Small Business United v. Yellen are not currently required to report BOI information. This includes:

  • Isaac Winkles and reporting companies where he is a beneficial owner.
  • Members of the National Small Business Association as of March 1, 2024.

1. Nationwide Injunction: On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction in Texas Top Cop Shop, Inc. v. Garland enjoining the enforcement of the CTA nationwide. This decision created significant uncertainty for reporting companies.

2. Reinstatement of the CTA: On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit stayed the district court’s injunction, allowing the CTA and its reporting requirements to be enforced once again.

3. Ongoing Legal Challenges:

  • Several cases challenging the constitutionality of the CTA remain pending in federal courts.
  • The Department of the Treasury and Department of Justice maintain that the CTA is constitutional, as supported by decisions in other jurisdictions, including the Eastern District of Virginia and District of Oregon.

Action Items for Reporting Companies

  • Review Deadlines: Ensure compliance with the revised reporting deadlines outlined above.
  • Verify Exemptions: Determine if your company qualifies for an exemption based on involvement in specific litigation or disaster relief.
  • Prepare BOI Reports: Use this additional time to gather and verify beneficial ownership information to avoid penalties for non-compliance.
  • Monitor Developments: Stay informed of further legal updates as additional rulings may impact the enforcement and requirements of the CTA.

If you would like more information regarding this topic please contact Thomas S. Tripodianos at ttripodianos@wbgllp.com or call (914) 607-6440

New York’s New Contractor Registration Scheme: What You Need To Know, And When You Need To Know It

Written by Gregory J. Spaun on . Posted in Legal Alerts.

Once upon a time, working on a prevailing wage project was easy. Contractors knew when the project was prevailing wage (the project was a public project), and they knew that they had to submit certified payrolls showing that they paid their employees the prevailing wage in the area (and actually pay those employees that wage). Now, between the expansion of prevailing wage to cover not only public projects but also private projects which receive a public benefit, and the new contractor registration scheme—which is now only days away—taking and working on prevailing wage projects just got more complicated.

Contractors may recall that over the past four years, the New York State Legislature has been busy enacting amendments to the various Labor Law statutes dealing with prevailing wage. Specifically, the legislature has expanded prevailing wage to cover: transportation of aggregate to and from a public works project site (Labor Law §220 [3-a(f)]); renewable energy projects with a generation capacity of more than one megawatt, thermal energy projects, offshore wind farms, and electric transmission facilities (Labor Law §224-d); broadband projects (Labor Law §224-e); climate risk/energy transmission projects (Labor Law §224-f[1]); and roadway excavation projects (Labor Law §224-f[2]). The legislature has also required that private1 projects “paid for in whole or in part out of public funds”, where the public funds constitute more than 30% of total costs and where the project costs more than $5 million, also be subject to prevailing wage (Labor Law §224-a). The legislature has determined that payments not subject to repayment, savings in the forms of tax credits, reduced fees, PILOTs (payments in lieu of taxes), reduced insurance rates, savings from waived fees, forgiven costs, contingent loans, and credits applied against the repayment of financing be considered “public funds”. While there is debate about whether some of the foregoing, particularly PILOTs (which are tax incentives given to jump start a project which otherwise wouldn’t happen because the ordinary tax burden would be too high to make the project profitable), are actually payments from public funds, that debate was resolved when Governor Hochul signed the legislation into law.

As far as where the industry is now, in 2022 Governor Hochul signed legislation to require contractors and subcontractors bidding or working on prevailing wage projects to register with the Department of Labor. This law is effective December 30, 2024, which means that prior to bidding on public work, or prior to commencing work on any prevailing wage project (for those contractors who enter contracts without having to bid pursuant to Section 103 of the General Municipal Law, such as subcontractors on public projects or any contractors on private projects subject to  prevailing wages), a contractor must be registered with the Department of Labor. The registration is undertaken online only, there is no mail-in option. During the registration process, contractors will be required to provide the following information (some of which is somewhat intrusive): i) the name, principal business address and telephone number; ii) the contractor’s form of business entity; iii) the name and address of all those with an ownership interest (with percentage), or, for publicly-traded corporations, the names and addresses of the corporation’s officers; iv) the contractor’s tax ID number, unemployment insurance registration number, and Worker’s Compensation Board employer number; v) whether the contractor has any outstanding wage assessments against it; vi) whether the contractor has been debarred under NY or federal law within the last eight years; vii) whether the contractor has been debarred by any other state within the last eight years; viii) whether the contractor has been determined to have violated any labor or employment tax laws, or failed to have workers’ compensation coverage, or failed to pay workers’ compensation premiums, income taxes, unemployment insurance contributions, or prevailing wage; ix) whether the contractor has been determined to have violated any laws relating to workplace safety (OSHA, etc.); x) whether or not the contractor has an apprenticeship program under Labor Law; and xi) whether or not the contractor is a M/WBE. The contractor must also submit their worker’s compensation insurance policy, upon the DOL’s request. The goal is to weed out contractors with spotty histories of complying with prevailing wage on public work, and prevent them from participating in the new expanded prevailing wage program. Accordingly, the above information will be made public (with personal information redacted) so that the public can assist DOL in monitoring compliance with the program. The registration will be good for two years, and must be renewed 90 days prior to the expiration. The filing fee is $200 ($100 for M/WBE contractors).

Once the contractor submits the registration, the DOL will undertake a review and make a determination as to whether the contractor is fit or unfit to work on prevailing wage projects. Under the regulations promulgated by the DOL for determining fitness, contractors currently debarred from traditional public work for prevailing wage violations, failing to pay union waves/fringe benefits, failing to obtain or pay for workers’ compensation insurance, or misclassification of employees will be determined unfit. (You may have noticed that amongst the information to be collected during the registration process also includes data relating to safety violations. The regulations are currently silent as to whether excessive, or any level of, safety violations can also supply reason for a determination of unfitness. However, it would not be surprising if some sort of safety-related criterion also emerged during this process.) Once a determination of unfitness has been made, the contractor has only 30 days to demand a hearing on the issue. If the contractor does not file its challenge to the determination within that time, the determination becomes final, and the contractor will not be registered and, accordingly, will be effectively debarred from any prevailing wage project.

Once a contractor is on the job, the DOL still has the ability to make a determination of unfitness and cancel a registration if new facts come to light which would have led to an unfitness determination had they been known at the outset. While this would ordinarily be a large monkey wrench thrown into the progress of the job, the statute offers a relief valve. Specifically, a contractor whose registration is cancelled while on the job can continue under the supervision of an accredited monitor to ensure that contractor’s compliance with prevailing wage requirements. (Of course, the issue arises as to who will ultimately pay for this monitor. This is another subject that should be addressed by experienced construction counsel in revising and negotiating your future contracts.) Similarly, if a contractor’s registration lapses while it is on the project, it can continue its work on that project (but it may not bid or take on new work without renewing its registration). Continuing work under a lapsed registration, as opposed to a canceled registration, does not require the appointment of a special monitor.

The net effect of this new requirement is that contractors cannot bid or start work on prevailing wage projects without being registered. The owner has the responsibility to verify the registration status of all contractors and subcontractors; similarly, upstream contractors have the responsibility to verify the registration status of all of their subcontractors before they commence work on the project. Having an unregistered contractor or subcontractor on the project will result in a $1,000 civil penalty being imposed (which will also likely be an obstacle to a future registration). The DOL’s website (https://dol.ny.gov/contractor-and-subcontractor-landing) is now live, and contractors need to use their NY.GOV credentials to process their registration. The DOL also has a FAQ page for questions about the registration process, and advises that registrations will be processed in three to four weeks. Given how quickly the impending deadline is approaching, and given the volume of traffic that the DOL will inevitably experience, contractors would be well advised to register immediately so that if there are any issues, they can be resolved in sufficient time so that there will be no interruption in bidding on, and taking work on prevailing wage projects.

If you would like more information about the new contractor registration scheme or prevailing wage requirements, come hear me speak on this topic at our Albany office at 6 Airline Drive, Albany, at 9:00 a.m. on December 11, 2024, or our White Plains office at 50 Main Street, Suite 1600, White Plains, at 9:00 a.m. on December 12, 2024. If neither of those dates work out for you, please email me at gspaun@wbgllp.com< or call me at (914) 607-6425.

1 Of course, one of the issues raised by the inclusion of private projects in the prevailing wage scheme is how contractors can protect themselves where the owner has the incentive to represent that prevailing wage does not apply (which would result in lower bids from contractors), but the contractor cannot verify whether the owner is receiving “public funds” sufficient to require prevailing wage. Robust indemnification provisions (including affidavit representations) could help alleviate contractors’ legitimate concerns; contractors should consult with experienced construction counsel to have their contract documents reviewed and revised accordingly.

If you would like more information regarding this topic please contact Gregory J. Spaun at gspaun@wbgllp.com or call (914) 607-6425