§198-eGC liable for a sub’s unpaid wages — even if the sub was paideff. Jan 2022
3 yrLookback on wage-theft claims against a general contractorLab. Law §198-e
$0Contract-value threshold — the law applies to all private constructionno minimum
10 hrWorkday spread triggering an extra hour of pay12 NYCRR 142-2.4
New York in short
New York’s biggest construction wage risk isn’t your own payroll — it’s your subcontractor’s. Labor Law §198-e, effective January 4, 2022, makes general and prime contractors jointly and severally liable for wage theft by a subcontractor at any tier, on all private construction contracts with no dollar threshold. Claims reach back three years, sub-tier employees can sue the GC directly with no contractual privity, and — the part most contractors get wrong — the GC remains liable even if it paid its subcontractor in full. Public works under Article 8, owner-occupied home improvement, and most 1-2 family home construction are exempt.
On hours, New York adds spread-of-hours pay: one extra hour at the basic minimum wage rate when the workday spans more than 10 hours from start to finish, including unpaid time. Because it is computed at the minimum wage rather than the regular rate, the obligation is often satisfied automatically for crews paid well above minimum. Overtime is standard weekly-40 for construction — the 44-hour threshold circulating in New York summaries applies only to residential Building Service employees such as doormen and supers, not to construction or roofing.
Summary as of July 2026 — rules move; verify current requirements with the New York labor department and qualified counsel. The California column is there for scale, not because it applies to you: it's the regime CDO's engine was built to, which is why New York's rules run inside it with room to spare.
What New York employers actually have to get right
Start with the rule that carries the most money. New York Labor Law §198-e (from S2766C), effective January 4, 2022, makes a construction contractor jointly and severally liable for unpaid wages, benefits, and wage supplements owed by any subcontractor at any tier. It applies to all private construction contracts with no dollar threshold, gives sub-tier employees a direct right of action against the GC without any contractual privity, and reaches claims arising within three years before filing. Exemptions cover public works subject to Article 8 prevailing wage, owner-occupied home-improvement contracts, and construction of 1-2 family dwellings unless the developer builds more than ten units a year at one site.
The provision that surprises people: paying your subcontractor in full does not discharge the liability. If the sub took your money and failed to pay its own crew, the workers can come to you. That inverts the assumption behind most subcontract agreements, and it means the practical defense is verification rather than indemnity — you need to know what the sub’s workers were actually paid, not just that you paid the sub. A 2025 federal decision narrowed the reach as to ERISA-preempted benefits claims, and a bill (A10740) proposed in March 2026 would extend liability to owners as well, though it has not been enacted.
Spread of hours (12 NYCRR 142-2.4) adds one hour of pay at the basic minimum wage rate for any workday whose span from first to last hour exceeds 10 hours — including unpaid meal time and gaps. Because it is calculated at the minimum wage rather than the employee’s regular rate, the obligation is generally satisfied where the day’s total compensation already equals or exceeds (hours worked + 1) × minimum wage, which is typically the case for construction crews earning well above the floor. It still needs to be computed rather than assumed.
Overtime for construction is standard weekly-40. The 44-hour threshold that appears in many New York summaries applies only to residential Building Service Industry employees under Wage Order Part 141 — doormen, supers, watchmen — and does not apply to construction or roofing crews. Misapplying it to a field crew produces underpaid overtime.
Meal periods come from Labor Law §162, which is unusual in being written around factory and mercantile classifications rather than a general rule. In practice, a 30-minute midday meal is required for shifts of six hours or more spanning the 11 a.m.–2 p.m. window, with an additional meal for shifts starting before 11 a.m. and continuing past 7 p.m. New York mandates no general rest or coffee breaks — only meal periods.
On heat, New York currently has no state standard for private construction. The proposed Temperature Extreme Mitigation Program Act remains pending. New York City issued Executive Order No. 17 on June 22, 2026, directing city agencies to develop heat-safety guidance and the Department of Buildings to review construction-site requirements with recommendations due March 1, 2027 — a directive to agencies, not yet an enforceable private-sector standard. Wages are regional: $17.00 in NYC, Long Island, and Westchester; $16.00 in the rest of the state; indexed to a capped CPI formula beginning January 1, 2027.
The one most New York contractors get wrong
§198-e liability survives paying your subcontractor in full. General contractors read the statute as a backstop for deadbeat subs and assume that a paid invoice ends the exposure. It does not: the sub’s employees have a direct claim against the GC regardless of privity and regardless of whether the sub was paid, reaching back three years, on any private construction contract with no minimum contract value. Indemnity clauses do not solve this — a judgment-proof sub cannot indemnify anyone. The only real defense is verifying what the sub’s workers were actually paid, which means requiring auditable time and payroll records from every tier below you. The second trap: the 44-hour overtime threshold does not apply to construction, only to residential building-service employees.
Wherever the rules land on the strictness scale, the constant is the same: disputes are decided by records. CDO's GPS-verified, minute-level, bilingual punch trail — reviewed by AI, with exceptions surfaced for human judgment — is the record that wins them. See why teams pick CDO →