NY Cause of Action For Unlawful Payroll Deductions
For those of you interested, I offer the following brief (no pun intended) discussion on a cause of action for unlawful payroll deductions (not to be confused with "withholding").
But briefly (again......npi) the Supreme Court has accepted a dictionary definition of the term "withholding" to mean payroll deductions made for tax payments. (See HARRY P. BEGIER v. INTERNAL REVENUE SERVICE, 110 S. Ct. 2258, 496 U.S. 53 (U.S. 06/04/1990-"The common meaning of "withholding" supports our interpretation. See Webster's Third New International Dictionary 2627 (1981) (defining "withholding" to mean "the act or procedure of deducting a tax payment from income at the source"").
To the extent that you work for a person that is not among those identified as an "employer" ( 26 U.S.C. section 3401) paying "wages" subject to "withholding" or paying "wages" subject to the FICA taxes ( 26 U.S.C. section 3121), the person making payroll deductions for these purposes does so negligently.
Under New York Labor Law, it is unlawful to make payroll deductions not approved by the payee or not required by any government law or regulation. Thus the law provides a duty owed to the payee on the part of the payer to make complete payroll payments.
The Elements of Negligence
The elements of a cause of action in tort for negligence are: (1) a duty to use ordinary care; (2) breach of that duty; (3) a proximate causal connection between the negligent conduct and the resulting injury and (4) resulting damage. (Budd v. Nixen (1971) 6 Cal.3d 195, 200.)
1. Under New York Law a payer has a duty to make complete payroll payments;
2. The application of the withholding provisions of 26 U.S.C. Subtitle C to a payer's payroll when the payer is clearly not among those identified as "employer" providing "employment"( for the FICA taxes) is clearly a breach of a known duty;
3. The unlawful payroll deductions injure the payee by both deprivation of property and the use of said property;
4. The payee is damaged to the extent of the property withheld and the loss of use of the property.
Workers in states other than New York and similarly affected by unlawful payroll deductions should search for their state laws that impose a duty on payers to make full payroll payments to their workers. Then sue the payer into compliance with the law or bankruptcy!!!!!