New York A 5431: Prohibits deceptive automatic gratuities

Bill Text

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A05431 Summary:

BILL NOA05431 

&nbsp

SAME ASNo Same As

&nbsp

SPONSORVanel

&nbsp

COSPNSR

&nbsp

MLTSPNSR

&nbsp

Add §349-h, Gen Bus L

&nbsp

Prohibits deceptive automatic gratuity practices.

Go to top A05431 Actions:

BILL NOA05431 

&nbsp

02/14/2025referred to consumer affairs and protection

01/07/2026referred to consumer affairs and protection

Go to topA05431 Committee&nbspVotes:

Go to topA05431 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topA05431 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 5431

 2025-2026 Regular Sessions

 IN ASSEMBLY

 February 14, 2025
 ___________

 Introduced by M. of A. VANEL -- read once and referred to the Committee
 on Consumer Affairs and Protection

 AN ACT to amend the general business law, in relation to prohibiting
 deceptive automatic gratuities

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. The general business law is amended by adding a new section
 2 349-h to read as follows:
 3 § 349-h. Restrictions on automatic gratuities. 1. Definitions. As used
 4 in this section, the following terms shall have the following meanings:
 5 (a) "Automatic gratuity" shall mean a gratuity that is charged to the
 6 consumer's bill automatically, regardless of the consumers right or
 7 ability to reduce or increase such gratuity.
 8 (b) "Establishment" shall mean a place of business that is open to the
 9 public in the state of New York.
 10 (c) "Point-of-sale terminal" shall mean an electronic device through
 11 which a consumer may initiate payment transactions.
 12 2. Deceptive automatic gratuities. An automatic gratuity shall be
 13 deemed to be deceptive where:
 14 (a) the establishment does not take reasonable steps to ensure that
 15 the consumer is made aware of the automatic gratuity prior to making an
 16 order while on the premises of the establishment;
 17 (b) the automatic gratuity is based on taxes, fees, or charges other
 18 than the itemized charges for services rendered or goods received;
 19 (c) the option to add an additional gratuity is presented to the
 20 consumer and the statement "A TIP HAS ALREADY BEEN ADDED TO YOUR BILL"
 21 is not conspicuously placed near such option with no additional words
 22 added to such statement; and
 23 (d) the attorney general promulgates rules or regulations pertaining
 24 to automatic gratuities and such rules or regulations are violated.

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD08428-01-5

 A. 5431 2

 1 3. Manufacturer's duties and liability. A manufacturer, software
 2 provider, or any entity responsible for developing or providing software
 3 for point-of-sale terminals:
 4 (a) shall ensure that all terminals sold after the effective date of
 5 this section do not include or have implemented any design or function,
 6 or any ability for an establishment to add a design or function, within
 7 a point-of-sale terminal that violates this section;
 8 (b) which has the ability to furnish software updates to existing
 9 point-of-sale terminals, shall update such terminals to exclude any
 10 prohibited designs or functions that violate this section by the effec-
 11 tive date of this section or, at such time when the attorney general
 12 promulgates rules and regulations pertaining to automatic gratuities,
 13 shall bring their point-of-sale terminals into compliance with such
 14 rules and regulations within a reasonable period of time as prescribed
 15 by the attorney general.
 16 4. Establishment's duties and liability. An establishment:
 17 (a) shall not add an automatic gratuity to a consumer's bill where
 18 such addition shall violate the provisions of subdivision two of this
 19 section;
 20 (b) that has a point-of-sale terminal in use that makes compliance
 21 possible, the establishment shall bring such terminal into compliance
 22 with this section by the effective date of this section. Where a termi-
 23 nal does not provide the ability to make compliance possible, the estab-
 24 lishment shall not be liable for failing to bring the point-of-sale
 25 terminal into compliance. Where the manufacturer, software provider, or
 26 en