New York employers should be ready to kick-off 2018 with a slew of updated policies and procedures to ensure compliance with the State’s changing legal landscape.  As we say “goodbye” to 2017, New York must say “hello” to the following laws, whose impact will surely be felt in the coming year:

  • The New York Salary History Law went into effect on October 31, 2017, making it illegal for an employer to inquire into a prospective job applicant’s salary or to rely on that history during the hiring process. We previously blogged about The New York Salary History Law (posts available here 4-7-17, 5-17-17, and 10-27-17), and its potential effect on the gender pay gap will certainly be watched with interest by those both within and outside New York.
  • The controversial New York City Fair Workweek Laws went into effect on November 26, 2017, consisting of 5 bills that directly impact New York City fast food restaurants and retailers by curtailing employers’ flexibility to establish and modify employee work schedules. We previously blogged about the New York City Fair Workweek Laws (posts available here 11-6-17 and 6-19-17), and this is another law to keep a close eye on given its wide ranging potential to affect an entire industry.
  • In accordance with legislation signed by Governor Andrew Cuomo in April 2016, effective December 31, 2017, small and large employers in New York City will see minimum wages rising to $12.00 and $13.00 per hour, respectively. Likewise, employers in Westchester, Nassau and Suffolk Counties will be subject to a $1.00 per year increase of the minimum wage to $11.00 per hour until it reaches the $15.00 per hour threshold on December 31, 2021.  Additionally, all other employers in New York will be required to raise the minimum wage another $0.70 (to $10.40) until it reaches the minimum wage of $12.50 per hour in December 2020.  We previously blogged about this legislation last year (post available here 4-28-16).
  • Perhaps the most highly anticipated law affecting employers and employees alike is the New York Paid Family Leave Benefits Law, effective on January 1, 2018. The law provides eligible employees with 8 weeks of paid leave per calendar year (increasing to 10 weeks in 2019 and 12 weeks in 2021) for events including: (i) participation in providing care, including physical or psychological care, for a family member with a serious health condition; (ii) bonding with a child during the first 12 months after the child’s birth, or the first 12 months after the child is placed with an employee for adoption or foster care; or (iii) any qualifying exigency as interpreted under the federal Family and Medical Leave Act (FMLA), relating to when a spouse, domestic partner, child, or parent of the employee is on covered active duty or called to active duty status.  The benefits are funded through employee payroll deductions, and employees are entitled to job protection and continuation of certain benefits during family leave.  The impact of the New York Paid Family Leave Benefits Law will surely be felt immediately by employees and employers alike.
  • On May 5, 2018, New York City will expand the types of leave covered by the Paid Sick Leave Law, which will soon be known as the “Earned Safe and Sick Time Act”. The Act will be expanded to cover “safe time” leave which can be used by an eligible employee to: (i) obtain services from a domestic violence shelter, rape crisis center, or other shelter or services program; (ii) participate in safety planning, temporarily or permanently relocate, or take other actions to increase the safety of the employee or employee’s family members; (iii) meet with a civil attorney or other social service provider to obtain information and advice on, and prepare for or participate in, any criminal or civil proceeding, including, but not limited to, matters related to a family offense matter, sexual offense, stalking, human trafficking, custody, visitation, matrimonial issues, orders of protection, immigration, housing, or discrimination in employment, housing or consumer credit; (iv) file a complaint or domestic incident report with law enforcement; (v) meet with a district attorney’s office; (vi) enroll children in a new school; or (vii) take other actions necessary to maintain, improve or restore the physical, psychological, or economic health or safety of the employee or the employee’s family member or to protect those who associate or work with the employee.  The law will still require employers to provide up to 40 hours of paid leave, which employees can now use for “safe time” in addition to sick time under the Act.

The approaching holiday season is a good time for employers to carefully review their handbooks, policies, and procedures to ensure compliance with the labyrinth of New York requirements.  Companies should, at a minimum, ensure that their human resources, benefits coordinators, and other key administrators are familiar with the above laws and their attendant requirements, and that the information is timely communicated to their workforces.

While sexual and other unlawful harassment issues have been present in the workplace for decades, the current news cycle has made the term a household name.  One cannot turn on the television, open a newspaper or surf the web without being inundated with daily reports of sexual harassment.  Politicians, news reporters, entertainers, and others are accused of sexual harassment and sometimes sexual assault, on a daily basis.

Harassment (both sexual harassment and harassment based on national origin, religion, LGBTQ status, etc.) is toxic in the workplace and can lead to a loss of talent, poor morale, negative publicity and, in the case of legal action, monetary damages and legal fees.  Still, many employers overlook the importance of developing and communicating effective anti-harassment policies and procedures and conducting anti-harassment training, often relegating this “compliance” issue to the bottom of the corporate “to do” list.  The current environment presents an opportune time to remind employers of the importance of addressing these issues and ensuring that they are providing a workplace that is free of sexual and other unlawful harassment.  In addition to helping to prevent harassment incidents in the first place, comprehensive anti-harassment policies and training also provide employers with an affirmative defense to any legal claims of harassment under both state and federal law.

The message to employers is clear – ignore these issues at your own peril!  Although the law in this area has been clear for some time, many employers do not appreciate the importance of addressing these issues proactively.  Employers are well served to review their anti-harassment policies and practices in light of the current social climate.

The controversial New York City Fair Workweek laws are scheduled to go into effect on November 26, 2017 at the conclusion of Thanksgiving weekend.  We previously blogged about the new laws shortly after their enactment earlier this year (post available here).  The legislation package, consisting of 5 bills, will directly impact New York City fast food restaurants and retailers by curtailing employers’ flexibility to establish and modify employee work schedules, among other limitations.

Some of the key changes impacting operators in the fast food industry include the following:

  • Employers will be required to provide “good faith estimates” of anticipated work schedules for all new hires.
  • Employers will be forced to provide all fast food workers with at least 14 days’ notice of their actual work schedules. Those schedules must then be conspicuously posted and displayed in the workplace.  Subsequent modifications will subject the employer to a range of monetary penalties payable to the affected employee(s).
  • Absent written consent by the employee (and an additional $100 in compensation), “clopen” schedules (closing a restaurant one night and opening the following morning) will be banned unless at least 11 hours have elapsed between shifts.
  • Employers will be required to offer additional work shifts to existing employees before hiring new workers to fill those shifts.
  • Fast food employees will be permitted to voluntarily direct employers, in writing, to take deductions from their paychecks (of at least $3 per week) in order to make contributions to non-profits; it will then be the employers’ obligation to remit payment to the designated non-profit .

In addition to the changes specific to the fast food industry, after November 26 all New York City retailers with at least 20 employees will be barred from scheduling “on-call” shifts and cancelling/altering work schedules within 72 hours of an employee’s scheduled shift start.

With the Fair Workweek legislation becoming effective only a few weeks from now, New York City fast food restaurateurs and retailers are strongly encouraged to consult with their legal advisors and reform their scheduling protocol and procedures.  Failing to do so may unnecessarily expose them to otherwise avoidable fines and penalties for violating the new laws.

On October 31, 2017, the New York Salary History Law (the “Law”) goes into effect, making it illegal for employers to inquire about a prospective job applicant’s salary history or to rely on that history during the hiring process.  Cole Schotz previously blogged about the legislation in posts NYC Pay History Ban: Combating Wage Disparity and NYC Pay History Ban to Take Effect October 31, 2017.

The Law, an amendment to the New York City Human Rights Law, prohibits an employer, an employment agency, and an employer’s agent or employee, from making inquiries regarding an applicant’s salary history other than in certain specifically enumerated situations.  The amendment defines the term “inquiry” broadly to include not only communicating a question to an applicant or his/her current or former employer about such salary history, but also includes searching publically available records or reports to obtain an applicant’s salary history.

The New York City Commission on Human Rights recently released Frequently Asked Questions (“FAQs”) concerning the Law, including the scope of coverage under the Law, what employers can and cannot do to learn about a job applicant’s salary expectations, the definition of “compensation” under the Law, and employer best practices. By way of example, the FAQs discuss whether an employer may conduct a background check in New York that includes information about an applicant’s salary history.  Hint: according to the FAQs, “in circumstances where an employer is legally permitted to perform a background check … the Commission recommends that employers specify to reporting agencies that information about salary history be excluded from the report.”  See FAQs, Section II.

The FAQs also specify “best practices” that an employer can implement to comply with its obligations under the Law including:

  • During the hiring process, focus questions on applicants’ salary demands, skills, and qualifications.
  • Ensure that job applications and other forms do not include questions about applicants’ salary history, even if such questions are framed as “voluntary.”
  • Modify written policies and educate interviewers and hiring staff to prohibit inquiries about applicants’ salary history.

See FAQs, Section V.  The FAQs are expected to be updated as necessary to facilitate compliance with the Law.

The Commission on Human Rights has also released a Job Applicant Fact Sheet and an Employer Fact Sheet advising applicants and employers, respectively, who is protected under the Law and what conduct is allowed under the Law.

Employers should ensure that all employees and agents, including, but not limited to, their human resources professionals and recruiters, are aware of the Law and their required compliance by October 31, 2017.  All employment applications and hiring materials should also be amended to omit any reference to salary history.

On October 19, 2017, the Court of Appeals for the Third Circuit ruled that New Jersey based Mary Kay consultants could not bring a claim in New Jersey federal court against Mary Kay for alleged violations of the New Jersey Wage Payment Law (“NJWPL”).  The court relied upon the broad forum-selection clause in the consulting agreements between the parties, which mandated that “any dispute or controversy . . .  concerning any matter relating to this Agreement . . . be submitted to the jurisdiction of the courts of the State of Texas.”

The consultants – New Jersey residents who performed their work under the agreements in New Jersey – argued that their statutory-based NJWPL claim did not fall within the scope of the forum-selection clause.  The court, applying Texas law in accordance with the contracts’ choice-of-law provisions, concluded that because the claim related to the working relationship between the consultants and Mary Kay, the claim necessarily implicated the contents of the consulting agreements.  Because the consultants did not overcome their exceptionally heavy burden of avoiding the enforcement of the Texas forum-selection clause, the Third Circuit affirmed the lower court’s dismissal of the action.

While the decision represents a strong win for employers and the freedom to contract, its implications are not without limitation.  Parties are not at liberty to select forums and governing laws that have absolutely no relationship to the parties and the dispute.  Here, the parties’ choice of Texas law and the Texas forum undoubtedly had the requisite connection to the parties and the dispute, as Mary Kay is headquartered in Texas.

Additionally, as the court took pains to point out, the consultants did not challenge the enforceability of the forum-selection clause, and instead limited their arguments to the scope of the clause.  Cognizant of the “predicament” for plaintiffs seeking the substantive protections of the employment laws of their home state, where they perform substantially all of their work, the court explained that it is incumbent on plaintiffs to challenge the enforceability of the clause itself, not merely its scope.

Parties to employment contracts are strongly encouraged to carefully consider the ramifications of choice-of-law and forum-selection clauses before litigation arises, lest they find themselves in a foreign jurisdiction with laws which may be unfavorable to their interests.