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Know The Law: It May Pay to Turn Yourself In

Posted on  | February 5, 2014   Bookmark and Share
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Plus winery quandaries, community concessions & new wage rules.

by Arielle Albert and Keven Danow

Recently a wholesaler learned it had not price posted in a number of years. The owner called the SLA and reported his company’s failure. Jaqueline Flug, counsel to the Authority, reported to the Members the fact that the wholesaler had come forward on its own. At her recommendation, the fine imposed was a relatively reasonable $30,000. Compare this result to recent cases in which wholesalers were fined $100,000 and given either a 30-day suspension or a 30-day deferred suspension. Clearly it pays to self-report.

Wineries in the Spotlight

During the last two full board meetings, the Members of the Authority struggled with issues relating to wineries. It is not uncommon for wineries and farm wineries to use their facilities to host events such as weddings. Lately, the Authority has been receiving complaints from people who argue that neighboring wineries are not functioning within the purview of their license but have morphed unexpectedly into a discotheque or catering hall. Neighbors complain of noise, lights, traffi c and trespassing.

At its December 17th, 2013 meeting, the Members revoked the license of Joseph Paul Winery, Inc., which does business as Vineyard 48, after hearing complaints from neighbors and police and reviewing the decision of the administrative law judge sustaining charges that the Vineyard had become a focal point for police attention, operated outside approved hours, and in general operated as a night club.

The Members rejected arguments that the actions of the Winery were analogous to wine tastings and were insufficient to justify cancellation or revocation of the license. The Members found the conduct went “far beyond the definition of a wine tasting” because the transgressions affected the quality of life of individuals in close proximity of the winery.

A similar issue came up at the January 3rd meeting, when a Madison County winery was denied a catering license. The Members are clearly seeking to strike the proper balance between the promotion of wineries—and the rights of the public to live in peace and tranquility.

At the January 3rd meeting, the Members were also asked to consider the legal size of a winery. There is no minimum production in the statute and a young man asked for a Vineyard license for his backyard garden which measured 10 feet by 40 feet and was completely paved. The man claimed he was growing vines in receptacles and could produce up to 100 cases of wine per year.

Alas, the question of whether a vineyard, like a tree, can grow in Brooklyn, must wait for another day. The members asked the applicant to provide proof that his “vineyard” would not violate local zoning laws.

Super Bowl pools are Illegal

Every year, as the Super Bowl approaches, local bars, taverns and restaurants host Super Bowl pools. The New York State Liquor Authority considers such a pool illegal gambling which will subject the licensee to disciplinary action.

Community Boards Take Another Bite at the Apple New York’s Alcohol Beverage Control Law requires on-premise licensees in New York City to notify their community board at least 30 days before fi ling an application to renew their licenses. Some community boards are taking this opportunity to seek concessions.

Recently, Community Board 1 asked applicants to agree to certain stipulations in exchange for the Boards’ approval of the renewal application. The law requires that the Liquor Authority give signifi cant consideration to the input of a community board. When an applicant for a new license is within 500 feet of three or more on-premise licensees, the applicant must demonstrate why the new license is in the community’s interest. However, in the case of a renewal, the burden shifts to the community board to show why the license should not be renewed.

New Minimum Wage Impact

New York State’s minimum wage will increase from $7.25 per hour to $9.00 per hour over the next three years. It increased to $8.00 per hour on December 31, 2013 and will increase to $8.75 per hour on December 31, 2014. Finally it will reach $9.00 an hour on December 31, 2015. Tipped workers are not included in the increase. However, if an employee does not receive tips in an amount equal to the minimum wage set for the industry, the employer will be required to pay the employee the difference between what the employee received and $7.25 per hour.

In addition, new IRS regulations reclassify, as wages, mandatory tips imposed by restaurants on parties of six or more. Tips are usually taken at the end of each day. Wages are included in the pay check and are subject to payroll taxes. The new regulation is based upon a ruling that tips must be voluntary. If they are imposed on the customer they are a service fee, not a tip.


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