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Employment Agencies

Introduction

N.Y. General Business Law § 170 et seq.

An “Employment agency” means any person who, for a fee acquires: (1) employment or engagements for persons seeking employment or engagements, or (2) employees for employers seeking the services of employees.

Click on the link below to find more information about this topic.

• What Employment Agencies Shall Include and Shall Not Include
• Discrimination
• Hiring Decisions
• Employment Agencies
• Rules for New York City

What Employment Agencies Shall Include and Shall Not Include

“Employment Agencies” include:

• any person engaged in the practice of law who regularly and as part of a pattern of conduct, directly or indirectly, recruits, supplies, or attempts or offers to recruit or supply, an employee who resides outside the continental United States for employment in this state and who receives a fee in connection with the arrangement for the admission into this country of such workers for employment.
• any person who, for a fee, renders vocational guidance or counseling services and who directly or indirectly: (1) procures or attempts to procure or represents that he can procure employment or engagements for persons seeking employment or engagements; (2) represents that he has access, or has the capacity to gain access, to jobs not otherwise available to those not purchasing his services; or (3) provides information or service of any kind purporting to promote, lead to or result in employment for the applicant with any employer other than himself
• “any nurses’ registry and any theatrical employment agency.

• any employment bureau conducted by a duly incorporated bar association, hospital, association of registered professional nurses, registered medical institution, or by a duly incorporated association or society of professional engineers, or by a duly incorporated association or society of land surveyors, or by a duly incorporated association or society of registered architects;
• any speakers’ bureau
• any organization operated by or under the exclusive control of a bona fide nonprofit educational, religious, or charitable institution;
• any person, firm, corporation or organization

Discrimination

§ N.Y. Exec. Law §§ 296, 296a

Hiring Decisions

§ 15 U.S.C. §§ 1681b(b), 1681c

A credit reporting agency may disclose information it has on a person to an employer who is thinking of hiring a new employee or promoting a current staff member. In the employment context, there must be a “permissible purpose” to secure a credit report. The potential employee or candidate for promotion must be notified and provide authorization to the employer to have access to their credit report. After being informed, the individual must consent to the credit check, in writing, and if the potential employee’s credit check results in the denial of employment, the employee must receive an adverse action notice informing them that they have been denied credit, employment, insurance, or other benefits based on information in a credit report. The notice should indicate which credit reporting agency was used, and how to contact them. The potential employee is entitled to a free credit report if they have been denied credit or employment in the last 60 days.

Be advised that if the potential employee has filed for bankruptcy, this cannot be disclosed to the employer.

For more information on a person's right to view and correct inaccurate information held by a credit reporting agency, see this manual’s chapter entitled “Credit and Credit Reporting”. Note, however, that the prohibitions relating to certain information in credit reports do not apply where the purpose for requesting the report relates to the employment of an individual at a salary of seventy five thousand dollars ($75,000) or more.

Employment Agencies

§ N.Y. General Business Law Art. 11 (§§ 170 – 191)

Any employment agency operating in New York State must comply with the provisions contained within Article 11 of the General Business Law. This Article sets the maximum fee an employment agency may charge a job applicant, requires agencies to be licensed, and prevents agencies from misrepresenting the nature of the positions it offers. The application for employment to an employment agency is required to be in the form of a written contract.

Employment agencies, including vocational guidance or counseling services, that charge a fee to employees, must be licensed by and bonded with the New York State Department of Labor.¹ Agencies in New York City must be licensed by the Department of Consumer Affairs. For more information, visit the website of the Department of Consumer Affairs at http://www.ci.nyc.ny.us/html/dca/html/home/home.shtml, call 212-NEW-YORK, or write to New York City Department of Consumer Affairs, 42 Broadway, New York, NY 10004 . Agencies that charge fees to employers for recruiting prospective employees are exempt from these regulations and are not required to register. Agencies are prohibited from sending applicants to employers where conditions for the job being offered are in violation of minimum wage or child labor laws.

The employer or employee is required to pay a placement fee which is typically paid in five (5) equal installments at the end of each pay period, or during the first ten (10) weeks of employment, whichever is longer. An advance fee may be required for domestic, manual, and industrial workers, except that domestic workers brought from out-of-state by an employment agency may pay in four (4) equal installments. The amount of fees is limited, depending on the type of employment.² A list of all fees must be posted at every employment agency.

If an employee secures employment through an employment agency and loses his or her job through no fault of his or hers, the maximum fee that may be charged by the employment agency for the employee is ten percent (10%) of the total wages earned. If the employee is discharged for cause or quits without good cause, a higher fee of up to fifty percent (50%) of the total wages earned may be charged, subject to the general limitation of fees. Special termination rates apply to persons brought from outside the continental United States.

Domestic workers employed on a day-to-day basis and who are transported to and from work by an employment agency are not required to pay any fee. The law provides for flat sum fees to be paid only by the employer. In addition, neither the worker nor the employer may be charged for the cost of transportation.

Employment agencies recruiting out-of-state domestics, (defined as domestics, household employees, unskilled or untrained manual workers and laborers, including agricultural workers), must provide suitable lodging and meals for any time they have not been placed in jobs during the first thirty (30) day period after they arrive or provide transportation for them to return home. Domestics recruited from outside the continental United States are afforded ninety (90) days of boarding in addition to hospitalization coverage.

Questions or complaints related to any aspect of employment should be directed to the New York State Department of Labor:

Department of Labor
Bldg. 12, Rm. 185A
Albany, NY 12240
Tel: 1-518-457-2730
Fax: 1-518-474-8452

Rules for New York City

All employment agencies operating in New York City, including vocational guidance and counseling services, whether or not they charge a fee to employees, must be licensed by the New York City Department of Consumer Affairs. Agencies are prohibited from sending applicants to employers where conditions of the job opening would be in violation of minimum wage or child labor laws.

The Department of Consumer Affairs can bring a suit against an employment agency in the name of any consumer injured by the agency’s “misstatement, misrepresentation, fraud or deceit, or any unlawful act or omission.”³