Bill > S04188

This bill establishes a new criminal offense in the New York penal law called "misappropriation of payroll funds," which occurs when a person knowingly prevents funds specifically designated for employee payroll or payroll taxes from being used for their intended purpose. The law clarifies that a delayed transfer of funds by a payroll processing company for the purpose of investigating potentially fraudulent transactions does not constitute misappropriation, and payroll processing companies are not responsible for an employer's failure to provide sufficient funds. The offense is classified as a class E felony, which typically involves less serious felony-level criminal conduct. By creating this specific criminal statute, the bill aims to protect employees' rights to receive their earned wages and ensure that employers do not illegally divert or misuse funds meant for payroll and payroll tax obligations.

Housing and Urban Affairs

https://www.nysenate.gov/legislation/bills/2025/S4188