New York Senate Bill S09755

New York 2025-2026 Regular Session

• Introduced: 4/2/26
• Refer: 4/2/26
• Report Pass: 5/12/26

Caption

Requires a payroll services business to compile and provide annual wage and tax statements and/or year-end forms to clients without additional cost or delay.

Summary

This bill would add a new section to New York’s General Business Law requiring certain payroll services businesses, as a condition of their contracts with clients, to compile and provide annual wage and tax statements and year-end forms, including W-2s, for both the client and the client’s employees. The forms must be provided without additional cost or delay, and the bill expressly bars payroll providers from withholding or postponing these documents because of any financial or other dispute with the client. The bill defines “payroll services business” to cover businesses that collect payroll data such as hours worked, pay rates, and deductions, and then use that information to generate paychecks, payroll reports, and tax filings, while excluding CPA offices and businesses that also provide accounting, bookkeeping, or billing services. It also authorizes civil penalties of up to $1,000 for a first violation and up to $1,500 for each subsequent violation, and would take effect 90 days after becoming law.

Impact

The bill would create a new consumer-protection-style obligation under the General Business Law for payroll service providers operating in New York. It would give clients and their employees a statutory right to timely delivery of wage and tax documents, and it would expose noncompliant payroll businesses to civil penalties enforced under state law. The measure primarily affects payroll processors and similar service vendors, while indirectly benefiting employers and workers who rely on those vendors for year-end tax reporting.

Sentiment

The available voting history suggests the bill has been received favorably in committee, passing the Senate Consumer Protection Committee unanimously by a 7-0 vote. There are no committee transcript snippets provided, so there is no recorded debate to indicate broader support or opposition. Overall, the bill appears to have a generally positive reception, at least at the committee stage, because it addresses a practical problem involving access to tax forms and payroll records.

Contention

The main point of contention embedded in the bill is the restriction on payroll providers’ ability to withhold or delay tax forms during contract or payment disputes. That provision favors clients and employees by ensuring uninterrupted access to W-2s and other year-end forms, but it may be viewed by payroll businesses as limiting leverage in commercial disputes. Another possible issue is the scope of the definition of payroll services business, which excludes CPA offices and firms that also provide accounting, bookkeeping, or billing services, potentially raising questions about which vendors are covered and whether the distinction is administrable.