December 17, 2019 | By Patrick T. McCloskey
On December 12, 2019 Governor Cuomo signed into law an amendment to Section 609(c) of the New York Limited Liability Company Law, expanding its application to foreign limited liability companies (LLCs). As explained in a recent blog post, this section currently imposes personal liability on the 10 largest equity owners of a New York LLC for unpaid wages. The amendment, which will become effective 60 days after Governor Cuomo signed it into law, will result in the ten largest equity holders of any LLC, domestic or foreign, having personal liability for such unpaid wages.
As an example, the ten largest equity owners of a Delaware LLC with employees in New York could, once the amendment is effective, have personal liability for any unpaid wages owed to such employees. Currently, before giving effect to the amendment, the members of a Delaware LLC are not covered because Section 609(c) only applies to LLCs formed in New York.
After giving effect to the amendment, Section 609(c) of the New York Limited Liability Company Law will mirror the analogous provision contained in Section 630(a) of the New York Business Corporation Law, which applies to both domestic and foreign corporations.
As set forth on the disclaimer page of this website, this post is for general informational purposes only and does not constitute legal advice. No one should rely on the information in this blog post without seeking appropriate legal, accounting, tax or other appropriate advice from an attorney, accountant or other professional properly licensed in the applicable jurisdiction(s).