- New York Tightens Human Rights Law Prohibitions Against Sexual Harassment
New York recently passed new workplace legislation, effective 60 days after Governor Cuomo signs the bill, that fundamentally upends the New York States Human Rights Law related to sexual harassment -- making the legal landscape far more plaintiff-friendly, although now the same standard for sex harassment under the New York City Human Rights Law. The new law eliminates the longstanding threshold that retaliatory or sexual harassment must be “severe or pervasive” for an individual’s hostile work environment claim to be viable. Instead, the new legislation prohibits discriminatory practices that are based on “inferior terms, conditions or privileges of employment because of the individual’s membership” in a protected class. Significantly, the new law eliminates the need for a victim to show that someone outside of his or her protected class was treated more favorably.
The law also eliminated an employer’s defense where an employee fails to assert an internal complaint of harassment to human resources or management -- previously available and known as the Faragher-Ellerth affirmative defense, which shielded an employer from liability when an employee did not previously complain despite an employer’s complaint procedure. Internal investigations launched to correct allegations of harassment will no longer serve as an affirmative defense under the new law, which instead permits employers to show as a defense that a “reasonable victim of discrimination” would not find the alleged harassment to rise above “petty slights or trivial inconveniences.” Such a low standard is not an equivalent substitute for the Faragher-Ellerth defense.
The law additionally prohibits the use of mandatory arbitration clauses in employment contracts, requiring all claims of discrimination to be adjudicated in a court proceeding. Previously, mandatory arbitration clauses only were impermissible for claims of sexual harassment. It will be interesting to see the law play out in light of the Federal Arbitration Act that permits arbitration agreements in employment matters for statutory claims. Perhaps, employees may soon abandon federal claims in favor of New York State and New York City Human Rights Laws claims that provide for equal or greater damages instead of federal claims to avoid a legal challenge based on the existence of an arbitration agreement.
The law also strips employers of the ability to include nondisclosure provisions in their settlement agreements for claims of discrimination, unless the complainant prefers its inclusion. Likewise, the law makes void and unenforceable any agreement that restricts the disclosure of factual information related to any future claims of discrimination unless it contains a provision that notifies the employee or potential employee that the agreement does not prohibit such disclosure to law enforcement, the Equal Employment Opportunity Commission, the State Division of Human Rights, a local commission of human rights, or an attorney retained by the employee or potential employee.
Further, the new law extends the statute of limitations from one year to three years for sex harassment complaints filed under the New York State Human Rights Law, permits plaintiffs to seek punitive damages (which were previously available only in housing discrimination cases), and require reasonable attorney’s fees to be awarded (which are only awarded in the court’s discretion under the current law). The right to punitive damages and attorney’s fees are in line with the New York City Human Rights Law.
Finally, the new law requires employers to provide employees notice of their sexual harassment prevention training program in writing in English and in employees' primary languages.
The new law will take effect 60 days after it’s enacted, except for the statute of limitations provision, which will take effect 180 days after enactment.
The amendment is a warning call to employers to review their policies, procedures and training programs now and to scrap the use of arbitration agreements for discrimination and harassment claims in New York.
2. New York State Legislature Proposes Strengthening Equal Pay Laws
The New York Legislature broadened employee protections afforded under New York’s Equal Pay laws with a proposed bill (amended law) that Governor Cuomo is expected to sign. The proposed bill provides far more sweeping protection than the existing law, which prohibits pay differentials based solely on sex, with few exceptions. The amendment prohibits compensation disparity on the basis of a membership in any protected class, the definition of which largely tracks that of the New York State Human Rights Law, including “age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, or domestic violence victim status.” The law currently requires plaintiffs to meet a more demanding standard by showing that they receive less pay than members of the opposite sex for equal work on a job that requires equal skill, effort and responsibility and is performed under similar working conditions. The amendment preserves that requirement, but also alternatively permits plaintiffs to meet a lower bar, showing that the work performed was “substantially similar… when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.”
The proposed bill maintains the law’s signature carveouts, which provide exceptions for pay differentials that are based on seniority systems, merit systems, and systems which measure earnings by quantity or quality of production. The catchall provision, which permits pay differentials that are based on a bona fide factor other than sex, would be amended to permit bona fide factors other than “status within one or more protected class or classes” as determinative of compensation.
While the proposed bill’s protective reach is undoubtedly broader than the current law, the impact of this amendment would provide even more significant hurdles for compensation disparities in light of a recent move by New York to pass Bill A05308B, which will modify NY Labor Law Section 194 (effective 180 days after it is signed by Governor Cuomo) by prohibiting employers from considering prior salaries when setting compensation for new hires. Once in effect, Section 194-a will bar employers from (a) relying on salary history to set a new wage, (b) requesting salary history orally or in writing, or (c) refusing to interview, hire, promote or otherwise employ a candidate for refusing to disclose salary history. However, the law does not prohibit voluntary disclosures by candidates or employees made in the interest of salary negotiation. Lastly, the law permits applicants and current or former employees to bring lawsuits against employers for violation of the law.
3. NJ Introduces Ban on Confidentiality Obligations to Settle Discrimination Cases
Like New York, New Jersey passed legislation that prohibits the inclusion of mandatory nondisclosure provisions in settlement agreements of claims of discrimination, retaliation or harassment. However, the law carves out an exception for employers who are party to collective bargaining agreements.
Employees who prefer nondisclosure clauses as a condition of their settlement agreements may accept them at their election. Employers who enforce or attempt to enforce mandatory nondisclosure provisions are liable for the employee’s reasonable attorney fees under the new law. Lastly, the law expressly excludes its application to non-compete provisions or provisions preventing an employer from disclosing proprietary information.
The law, which was passed in March 2019, took effect immediately, applying to all future employment contracts entered into or modified thereafter.
4. New Jersey Increases Paid Leave Time Under Paid Family Leave Law and Expanded Scope of New Jersey Family Leave Act
New Jersey expanded two leave laws effective June 30, 2019 by (1) expanding the scope of the Paid Family Leave Law (“PFLL”) to bring smaller businesses under its regulatory scheme and increasing the weekly benefit in the future and (2) expanding the definition of covered family members under the New Jersey Family Leave Act (“NJFLA”).
The PFLL provides for paid leave benefits under New Jersey’s Family Leave Insurance Program for qualified individuals up to a statutory maximum weekly benefit for as much as eight weeks of leave. Signed by Governor Murphy in February, the newly amended PFLL covers businesses that employ at least 30 individuals who work for 20 or more calendar workweeks, whereas the previous law only covered businesses with at least 50 employees. The changes to the Family Leave Insurance Program are slated to take effect July 1, 2020. The weekly benefit rate will increase to 85% of the employee’s average weekly rate under the changes to the Family Leave Insurance Program, with a new capped maximum of $859 per week, replacing the old cap of $633 per week. Finally, the law makes it an unlawful discriminatory practice to discharge, harass, or retaliate against an employee who requests leave or benefits under the Family Leave Insurance Program.
Under the NJFLA, all employers covered by the Act are required to provide up to 12 weeks of family leave to eligible employees. The amendment broadens the definitions of “parent” and “family member.” The term “parent” now additionally covers foster parents and those who become parents through surrogacy. The definition of “family member” is now quite broad, covering siblings, parents-in-law, grandparents, grandchildren, domestic partner, any individual related by blood, and “any other individual that the employee shows to have a close association with the employee which is the equivalent of a family relationship.”
The NJFLA also was amended to enlarge the window of intermittent leave threefold to permit intermittent leave to be taken over a 12-month period -- rather than 24 weeks under the prior iteration of the Act.
5. New Jersey Raises Minimum Wage to $15 Per Hour
In February 2019, New Jersey enacted legislation to raise New Jersey’s minimum wage incrementally on an annual basis until it reaches $15.00 per hour on January 1, 2024. The State’s minimum wage currently is $8.85 per hour, but starting July 1, 2019 will be increased to $10.00 per hour, increasing by $1.00 each January 1 until it reaches the $15.00 per hour mark in 2024.
The law takes into account the impact it will have on seasonal workers (employed from May 1 to September 30) and small businesses (those with less than six employees for every working day during a majority of the calendar workweeks). Small businesses’ minimum wage increases are subject to an alternative timeline, reaching the $15.00 per hour mark on January 1, 2026 -- two years later than those employers with more than six employees.
In January 2024, when New Jersey’s minimum wage reaches $15.00 per hour, agricultural workers’ minimum wage will be $12.50 per hour. The law outlines a process by which the Labor Commissioner and the Secretary of Agriculture will determine whether to incrementally increase the minimum wage to $15.00 per hour for agricultural workers as well. If these officials decide in the affirmative, the wage will be increased incrementally to reach $15.00 by January 1, 2027.
Employers who pay minimum wage or rates that will be impacted by these changes must be mindful of these incremental increases that affect straight time and overtime compensation.
6. Connecticut Increases Minimum Wage
Like New Jersey, Connecticut enacted legislation that will raise the State’s minimum wage to $15.00 per hour on an incremental basis. The law, signed by Governor Lamont on May 28, 2019, begins to increase the minimum wage effective October 2019 and aims to reach the $15.00 per hour mark by June 2023. Connecticut’s current minimum wage, $10.10 per hour, is now set to increase as follows:
- $11.00 per hour on October 1, 2019
- $12.00 per hour on September 1, 2020
- $13.00 per hour on August 1, 2021
- $14.00 per hour on July 1, 2022
- $15.00 per hour on June 1, 2023
The new law sets forth a scheme by which the minimum wage could potentially increase after January 1, 2024 as well. Accordingly, Connecticut’s minimum wage will be adjusted by the percentage change in the employment cost index, as calculated by the US Department of Labor, but it expressly provides that the minimum wage will not fall below the $15.00 per hour mark after 2023.
Minors (except for emancipated minors) must be paid at least 85 percent of the minimum wage for the first ninety days of employment which can be used to account for a training period, but employers are prohibited from partially or fully displacing a regular employee in favor of a minor in order to pay below minimum wage. If an employer violates this provision, the Labor Commissioner may suspend the employer’s right to pay the training rate for a period of time.
Under the new laws, the tip credit for restaurant and hotel employees who regularly earn tips (for which an employer can take a “tip credit” toward the minimum wage) will remain unchanged. The current minimum cash wage is $8.23 for bartenders and $6.38 for other restaurant and hotel staff. However, the amount of tip credit still must satisfy the new, higher minimum wage rates once they increase. Therefore, the tip credit to cover the difference will be higher as the minimum wage increases.
Employers who pay minimum wage or rates that will be impacted by these changes must be mindful of these incremental increases that affect straight time and overtime compensation.
7. New York City Bans Pre-Employment Marijuana Tests
Following the national trend of enacting marijuana-friendly legislation, New York City passed a law that protects the majority of applicants who are marijuana users within the City. Enacted in May 2019 and effective May 10, 2020, the law outright bans employers, labor organizations, employment agencies, or agents from testing job applicants for traces of marijuana or tetrahydrocannabinols (THC) in their system during the hiring process. Requiring a job applicant to submit to a marijuana/THC test as a condition of employment will be considered an unlawful discriminatory practice under the New York City Human Rights Law unless the job falls under one of the law’s exceptions. However, employers may still require current employees to submit to the same marijuana/THC test.
Testing for the presence of marijuana or THC is permissible during the hiring process in limited circumstances for: police officer or peace officer positions; positions that require a commercial driver’s license; or positions that require supervision of children, medical patients or vulnerable persons. Certain construction workers also fall under the exception, as well as any position that significantly impacts the health or safety of employees or members of the public.
The law also does not preclude federal legislation that mandates drug testing for positions in the Department of Transportation or positions that deal with safety or security. Nor does the new law prohibit testing in the case of employers who are party to a “valid collective bargaining agreement that specifically addresses the preemployment drug testing of…applicants.”
In light of the new law, employers should review and make necessary updates to any related drug testing policies.
