June 8

New York Workers Compensation Fines

Penalties for noncompliance with the workers’ comp. or workers compensation can range from a few thousand dollars to egregious amounts in the tens of thousands of dollars. When you open a business in New York and have employees, acquiring workers compensation insurance is not a step that you can skip. Ask some of my business clients and they will tell you how much I harp on this. Yes, it is somewhat costly depending on the size of your business, but it is imperative you do not skip this step when starting a business. It will cost you. How much?

What is the law and what are the possible penalties?

Failure to secure coverage can be prosecuted both civilly and criminally.

Criminal: – Section 52 [1] (a) of the Workers’ Compensation Law provides that a failure to secure the payment of compensation for five or less employees within a 12 month period shall constitute a misdemeanor punishable by a fine of not less than $1,000 nor more than $5,000. Failure to secure the payment of compensation for more than five employees within a 12 month period shall constitute a class E felony punishable by a fine of not less than $5,000 nor more than $50,000 and is in addition to any other penalties otherwise provided by law.

Civil: Section 52 [5] of the Workers’ Compensation Law provides that the Chair, upon finding that an employer has failed for a period of not less than ten consecutive days to make the provision for payment of compensation may impose upon such employer, in addition to all other penalties, fines or assessments, a penalty of up to $2,000 dollars for each ten day period of non-compliance or a sum not in excess of two times the cost of compensation for its payroll for the period of such failure, which sum shall be paid into the uninsured employers’ fund. When an employer fails to provide business records sufficient to enable the chair to determine the employer’s payroll for the period requested for the calculation of the penalty provided in this section, the imputed weekly payroll for each employee, corporate officer, sole proprietor, or partner shall be the New York state average weekly wage, multiplied by 1.5. Where the employer is a corporation, the president, secretary and treasurer thereof shall be liable for the penalty.

There are also fines and levies that can be collected for failure to maintain accurate payroll (both civilly and criminally), and heavy fines for mis-respresentation. When thinking mis-representation think:

Paying workers “off the books,”
Not reporting wages paid to illegal aliens,
Misclassifying employees as “independent contractors,” and
Misclassifying the work of a business to a classification that is less hazardous (identifying all roofers as secretarial staff), and/or
Intentionally, materially misrepresenting or concealing information pertinent to calculation of premium paid.

See http://www.wcb.ny.gov/content/main/Employers/nonCompliancePenalties.jsp for the full run down or click NY workers comp fines

I just received a letter from the workers compensation board stating that I owe $22,000.

Maybe you’re reading the above text too late, or thought it wasn’t going to catch up with you. You receive a letter stating that you owe a very large amount of money from the New York State Workers Compensation Board. What do you do? Call me. I am a big advocate of do-it-yourselfing when it’s possible, but here I recommend an attorney to negotiate with the board. Sometimes these fines are so large it would put a company out of business. This is one of the times in life where it’s worth getting an attorney involved.

If you’re looking at a large fine, we have successfully negotiated these dollar amounts down truly significant amounts of money on a contingent basis. Most businesses are ok with this arrangement.

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December 4

“I received a NY Notice of Probate in the mail. What is this?”

Once every other week I receive a phone call from a concerned party about receiving a Notice of Probate in the mail. We all know the real question that sparks this phonecall, but I’ve broken it down into five parts for added suspense.

I. What is a Notice of Probate?

Notice of Probate is explained in Surrogate’s Court Procedure Act (SCPA) § 1409. (1) Essentially it is a statutory formality that puts certain classes of people on notice that the decedent has died and that your name is listed somewhere in the will.

So, the question you really called for? Yes. You are named in the will if you receive a notice of probate. Does that mean what you want it to mean? Eh, please read “named” as literally as possible.

II. What do the terms that appear on the notice of probate actually mean? Legatee, devisee, trustee, guardian, executor, testator and successor terms defined. (2)

For the truly inquisitive I’ve placed some working definition of these terms in the footnotes. Most of them are archaic words that the law has never been able to let go of, and probably never will. I like to sum it up as simply as possible: legatees and devisees get stuff and trustees/guardians/executors do stuff. Don’t worry, the law doesn’t expect the doers to work for free though. They are eligible for compensation also. See SCPA §§ 2307, 2308, 2309.

Please note that on the Notice of Probate it will state what title you have, so you can begin to formulate a hypothesis for the most important question.

III. Am I going to receive money?

And here is the let down: it depends.

First off, is the estate solvent? Are there debts and liabilities that essentially negate the estate? If the debts plus the costs of administration are greater than the estate’s assets then no, you are not going to receive any money.

Secondly, what are you named in the will? There is no requirement that the will be sent along with a Notice of Probate, therefore you will probably be in the dark as to what the will states. It is impossible to know if you are receiving money without a copy of the will. I can play the “if this then that” game with you for 15 minutes, but we still won’t know for sure . You could be named solely as a successor executor. If that is the case you are probably not going to see any money. This leads up to our next question.

IV. Can I see a copy of the will?

Yes. A will is a public document that is accessible and it is possible to obtain a copy.

V. What do I do next?

Again this is another one of those questions where it just plainly depends. For example, if you are a specific legatee, you may just have to wait for Letters Testamentary to be issued to the executor and your bequest to be distributed. Feel free to contact me with any other questions.

Anthony Nigro is a Surrogate’s Court practitioner that primarily works out of the following counties: Westchester, Bronx, New York, Kings, Queens, Rockland, Orange, and Dutchess. Appointments can be set up by telephone, email or through his “Contact” page.

(1) “Before letters are issued there shall be filed in the court a notice…that the will has been offered for probate or probated, as the case may be. The notice…shall state whether such person is named or referred in the will as legatee, devisee, trustee, guardian or substitute or successor executor, trustee or guardian…”

(2) legatee: any person designated to receive a transfer by will of personal property (SCPA § 103.33).

devisee: any person to whom real property is transferred by will. (SCPA § 103.13).

trustee: the person appointed, or required by law, to execute a trust (Blacks Law Dictionary).

guardian: A guardian is a person lawfully invested with the power, and charged with the duty, of taking care of the person and managing the property and rights of another person, who, for some peculiarity of status, or defect of age, understanding, or self-control, is considered incapable of administering his own affairs. (Blacks Law Dictionary).

testator: One who makes or has made a testament or will; one who dies leaving a will. (Blacks Law Dictionary).

executor: A person appointed by a testator to carry out the directions and requests in his will, and to dispose of the property according to his testamentary provisions after his decease (Blacks Law Dictionary).

successors: are those named in a will that will take the place of the initial parties named due to incapacity or death.

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November 16

What Happens When You Die Without a Will in NY or How I Learned to Stop Worrying and Love the Idea of a Will

Luckily, and unluckily for some, the state of New York has devised a law that states exactly what happens to a person’s estate when they die without a will, or intestate as we lawyers like to call it. It is codified in EPTL § 4-1.1. It’s easy not to be familiar with this section of the law, because, let’s face it, we only die once.

It states, in part:

“Distribution shall then be as follows:
(a) If a decedent is survived by:
(1) A spouse and issue, fifty thousand dollars and one-half of the residue to the spouse, and the balance thereof to the issue by representation.”

Please note that there are six other distribution mandates when the above does not apply, but for now I just want to focus on this one. At first blush it seems to be ok. You probably would have left everything to your immediate family anyway right, so what’s the big deal?

Let’s specify some more:

You were a middle aged, middle/upper-income earning man with two children and a wife who you were lucky to have been living in beautiful Westchester, NY getting by working 10 hours a day to support your property taxes. You had your children later in your thirties because you had been so focused on work and then when 52 hits so does the big one- the big heart attack that is. You leave your wife with a twelve and fourteen year old, $450,000 in the bank and a mortgage to pay. And you never saw Paris.

So, by the letter of the law the first $50,000 goes to your wife. That’s seems reasonable. Then she takes half of the rest- $200,000. Ok, not bad.

And then what: your two children, minors at the time, inherit $200,00 equally? What? Why? Of course this raises more questions: why do I want my minor children inheriting money that my wife needs to raise them? You don’t. Then more practically: how does the Surrogate’s court actually give my minor children $100,000 each? The specifics can be summed up to one word: expensive. Oh and time consuming. So in a situation where your family needs money now and doesn’t want to spend any of it needlessly, they will be doing the opposite.

A Last Will and Testament in New York is, in my mind, an effective insurance policy that not only can direct your wishes and desires, but it can end up saving your family time and money when life is at its hardest.

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June 25

EPTL § 4-1.4: Disqualification of Parent to Take Intestate Share in New York

EPTL § 4-1.4 Disqualification of parent to take intestate share

(a) No distributive share in the estate of a deceased child shall be
allowed to a parent who has failed or refused to provide for, or has
abandoned such child while such child is under the age of twenty-one
years, whether or not such child dies before having attained the age of
twenty-one years, unless the parental relationship and duties are
subsequently resumed and continue until the death of the child. Subject
to the provisions of subdivision eight of section two hundred thirteen
of the civil practice law and rules, this paragraph shall not apply to a
biological parent who places such child for adoption with a person or
agency based upon: (1) a fraudulent promise, not kept, to arrange for
and complete adoption of such child, or (2) other fraud or deceit by the
person or agency where, before the death of the child, the person or
agency fails to arrange for the adoptive placement or petition for the
adoption of the child, and fails to comply timely with conditions
imposed by the court for the adoption to proceed.

(b) In the event that a parent or spouse is disqualified from taking a
distributive share in the estate of a decedent, under this section or
5-1.2, the estate of such decedent shall be distributed in accordance
with 4-1.1 as though such spouse or parent had predeceased the decedent.”

A proceeding to disqualify a parent under this little-known statute comes at the unfortunate time where a parent outlives their own child. For a child to have amassed any assets usually means that there was a negligence suit of some sort and a positive settlement has been made on behalf of the child’s estate. Again, usually, this child dies without a will and one spouse will assert that the other parent had abandoned or failed to provide support for the deceased child during the course of his/her life. This is always an incredibly tough situation, and sadly it does happen.

The rationale behind the statute is admirable though. Why should a parent who has abandoned their child or failed to provide for them in their formative years be entitled to half of what the child had acquired throughout their life? Although admirable, the standards the legislature have set in the statute are not always as easy to prove as one would think.

The standard of abandonment stated above is also shrouded in case law. The takeaway is that the entire process always becomes highly fact specific. What does that mean for the potential client? Come in ready to have a tough, lengthy conversation. Above all: be honest with me. Even a white lie in these cases can prove highly detrimental down the road.

Losing a child is hard enough. If you ever find yourself in this situation please do not hesitate to reach out to us to begin a conversation.

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