New York Retailers Face Payroll Compliance Scrutiny
The state's labor agency recovered $674,526 for retail employees due to violations of mandatory spread-of-hours pay requirements.
Updated on Oct. 30, 2026 in Employment
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The New York State Department of Labor recovered $674,526 in back wages for 7,577 TJX Companies employees following an audit of 185 store locations. The agency found that the company failed to comply with state rules regarding additional pay for extended shifts.
Why it matters
This recovery highlights the strict enforcement of New York’s spread-of-hours pay requirements, which mandate extra compensation for workdays exceeding 10 hours. Retailers operating in the state must ensure payroll systems correctly flag these split-shift or long-day violations to avoid costly audits and back-pay mandates.
The state recovered $674,526 for 7,577 employees across 185 store locations, part of a broader state enforcement trend that saw the Department of Labor return $35 million in unpaid wages to workers in 2025. Individual back-wage payments reached as high as $4,686.
The players
New York State Department of Labor
The state agency responsible for enforcing labor laws and wage protections for employees operating within New York.
The TJX Companies
A major off-price retail corporation operating thousands of stores, including the Marshalls and TJ Maxx banners.
The details
The investigation began in April 2023 after an unannounced visit to a Marshalls store in the Bronx prompted a deeper review of payroll records. State investigators scrutinized shifts from August 2020 through August 2023 to verify compliance with the spread-of-hours rule. The company failed to provide an additional hour of pay at the minimum wage rate for workdays spanning more than 10 hours, a common compliance hurdle for large retailers.
Timeline
August 2020: The period covered by the company self-audit began.
April 2023: The New York State Department of Labor initiated the investigation.
August 2023: The period covered by the company self-audit concluded.
2025: The agency recovered $35 million in total unpaid wages state-wide.
October 30, 2026: The Department of Labor officially announced the wage recovery.
Market Landscape
This enforcement action highlights the rigorous application of New York State's spread of hours rule. It follows the pattern set by the state’s broader labor compliance initiatives, which have returned $130 million to 125,000 workers since 2021.
Operators in New York should verify that payroll software is configured to automatically trigger an extra hour of pay when a shift duration exceeds 10 hours. Consult with legal counsel to audit current timekeeping practices against state spread-of-hours regulations.
The takeaway
Large retailers must ensure that automated payroll systems account for the total duration of a shift rather than just hours worked. Regularly review shift schedules to confirm compliance with state-mandated split-shift or extended-day pay thresholds to avoid future back-wage liability.
Further reading
For more on workplace compliance standards, visit the Employment section.
More information
For more information on labor regulations or to review wage requirements, visit the Department of Labor wage complaint filing.
Source note: This article includes information reported by WRGB.
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