Out of State LLC Shareholders Can Be Personally Liable for New York Unpaid Wages
Updated: Jan 23
Effective February 10, 2020, the ten members with the largest percentage ownership interest of an out of state LLC can be held personally liable for violations of New York’s wage and hour laws. Previously, only domestic LLC shareholders were subject to individual liability for unpaid wages. The ten members with the largest percentage ownership interest, are calculated based on the percentage of ownership of each member during the time period the violations occurred.
Employees must first obtain a judgment against the LLC that is unsatisfied and must provide the members written notice of the intention to hold them personally liable. Employers should review their pay practices to ensure compliance with New York State law when doing business in New York.
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