On September 20, 2022, New York City Mayor Eric Adams announced that New York City will end the vaccine mandate for the private sector, which has been in effect since December 27, 2021. As we reported, the vaccine mandate required workers in New York City who go to work in-person or interact with the public to show proof of full vaccination for COVID-19 to their employers, unless they obtained an exemption for medical or religious reasons.

As of November 1, 2022, private employers in New York City will no longer need to require COVID-19 vaccination to allow employees to enter their workspaces or interact with the public during the workday. That being said, these employers are still permitted, and encouraged by New York City, to enforce their own mandatory vaccine policies, subject to compliance with applicable federal and local guidance.

On September 9, 2022, the New Jersey Cannabis Regulatory Commission (“CRC”) issued interim guidance (the “Guidance”) for employers regarding the employment protections passed for cannabis users last year pursuant to the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (“NJCREAMMA”).  The Guidance shall remain in effect until the CRC publishes the standards for Workplace Impairment Recognition Expert (“WIRE”) certification.

As noted in more detail below, the Guidance discusses an employer’s right to maintain a substance-free workplace and offers practical guidance for employers struggling with how to ascertain whether an employee is impaired during working hours.

What protections are available to cannabis users in the workplace?

As we previously reported, NJCREAMMA provides various employment protections for employees who use cannabis recreationally and imposes strenuous requirements on New Jersey employers who conduct drug testing for the presence of cannabis in an individual’s system.  Namely, under NJCREAMMA:

  • New Jersey employers are prohibited from refusing to hire or take any adverse employment action against employees based solely on their use (or nonuse) of recreational cannabis. Therefore, an employer may not terminate an employee solely because he or she fails a drug test due to cannabis use.
  • Any cannabis testing conducted by employers must be based upon “scientifically reliable objective testing methods and procedures, such as testing of blood, urine, or saliva” and the test must also include a “physical evaluation in order to determine an employee’s state of impairment.”
  • The individual conducting the aforementioned “physical evaluation” must be certified as a WIRE in accordance with standards to be established by the CRC, which will include receiving education and training “in detecting and identifying an employee’s usage of, or impairment from, a cannabis item or other intoxicating substance, and for assisting in the investigation of workplace accidents.”

Notably, the “physical evaluation” requirement has been temporarily suspended by the CRC since August 2021 until the CRC develops WIRE certification standards.  As noted above, the Guidance provides that it “is intended to serve as guidance until the NJ-CRC formulates and approves standards for WIRE certifications.”

What does the Guidance say?

The Guidance contains the following key takeaways:

  • The Guidance reaffirms that NJCREAMMA prohibits employers from taking any adverse employment actions against employees based solely on their use of cannabis or having cannabis metabolites in their system.
  • The Guidance emphasizes that NJCREAMMA does not interfere with an employer’s right to maintain and enforce a substance-free workplace and require employees to undergo drug testing in the following circumstances: (1) an employer having reasonable suspicion of an employee’s usage of cannabis or cannabis products while performing their job duties; (2) an employer finding any observable signs of impairment related to cannabis or cannabis product use; (3) as part of a random drug testing program; or (4) following a work-related accident subject to investigation by the employer.
  • Employers are permitted to take an adverse action against an employee who, in connection with a drug test that meets the law’s requirements, tests positive for cannabis use and when there is “evidence-based documentation of physical signs or other evidence of impairment during an employee’s prescribed work hours[.]” Significantly, the Guidance does not explicitly require that an employer conduct a drug test for cannabis use to take an adverse employment action against an employee.  Instead, the Guidance states that having documented reasonable suspicion of impairment “paired with other evidence, like a drug test” may be used to determine that an individual violated a substance-free workplace policy.
  • To determine physical signs or other evidence of impairment sufficient to support an adverse employment action against an employee for potential cannabis use or impairment during working hours, the Guidance offers the following suggestions to employers:
    1. Designate an interim staff member or third-party contractor to make determinations regarding suspected cannabis use. The Guidance states that this individual should be trained and qualified to determine impairment and complete a Reasonable Suspicion Observation Report (more on that below).
    2. Use the sample Reasonable Suspicion Observation Report from the CRC, or a similar form created by the employer, to document the “behavior, physical signs, and evidence” to support the determination that there is reasonable suspicion that an employee is under the influence of cannabis during working hours.  Notably, the sample Reasonable Suspicion Observation Report is not specific to cannabis and contains numerous detailed recommended practices and procedures to follow, including a list of relevant physical symptoms to assess.
    3. Maintain a “Standard Operating Procedure” which identifies a process for completing a Reasonable Suspicion Observation Report.
  • Employers may use a “cognitive impairment test, a scientifically valid, objective, consistently repeatable, standardized automated test of an employee’s impairment, and/or an ocular scan, as physical signs or evidence to establish reasonable suspicion of cannabis use or impairment at work.”
  • The Guidance reaffirms that NJCREAMMA contains a carveout for employers who are “subject to the requirements of a federal contract” and for whom there would be a “provable adverse impact” if they had to comply with the law.

What should employers do now?

All New Jersey employers should carefully review the Guidance and update their current drug testing and substance-free workplace policies and procedures with counsel to ensure compliance with the Guidance.  Employers should also either implement the CRC’s sample Reasonable Suspicion Observation Report or create their own for use in connection with enforcing substance-free workplace policies.  Finally, employers should identify and train employees who can determine suspected cannabis impairment during work hours or use a third-party contractor.

In East Bay Drywall, LLC v. Department of Labor & Workforce Development, decided on August 2, 2022, the New Jersey Supreme Court confirmed the difficulties employers face when trying to establish independent contractor status for their workers. In East Bay Drywall, the Court upheld a finding by the New Jersey Department of Labor and Workforce Development (the “NJDOL”) that a drywall business failed to demonstrate sufficient proof that its workers were established in an independent business and thus affirmed the conclusion that they should be designated as employees. By way of background, in determining whether a worker is an employee or independent contractor for purposes of the State’s wage and hour laws, unemployment compensation and disability insurance, courts in New Jersey apply the commonly known “ABC test.”

Pursuant to the ABC test, a worker is presumed to be an employee unless:

A) Such individual has been and will continue to be free from control or direction over the performance of such service, both under his or her contract of service and in fact;

B) Such service is either outside the usual course of the business for which such service is performed, or that such service is performed outside of all the places of business of the enterprise for which such service is performed; and

C) Such individual is customarily engaged in an independently established trade, occupation, profession, or business.

See N.J.S.A. 43:21–19(i)(6).  Significantly, each prong of the test must be met in order for an individual to be legally classified as an independent contractor.

In analyzing the third prong of the above ABC test, the East Bay Drywall Court addressed the fact that several workers, whom the employer classified as independent contractors, submitted certain documentation to establish that they were independent businesses, including certificates of insurance and business entity registration information. While they showed creation of a separate corporate entity, the subcontractors failed to show that they operated outside of East Bay Drywall. The Court ultimately held that corporate formation information was insufficient to prove the entities’ independence. Specifically, the Court found that this case presented a “less obvious situation” of whether the workers were truly independent business entities and the lower court (which reversed the NJDOL) should have considered the factors described in Carpet Remnant Warehouse, Inc. v. Dep’t of Labor, 125 N.J. 567 (1991), Gilchrist v. Div. of Emp. Sec., 48 N.J. Sper. 147 (App. Div. 1957), and Trauma Nurses, Inc. v. Dep’t of Lab., 242 N.J. Super. 135 (App. Div. 1990), which require analysis of items including the strength and duration of the business, whether the entities supplied their own tools, equipment, or vehicles, or whether the entities maintained independent business locations, advertised, or had employees. None of this information was presented in this case and the Court thus found that the employer failed to establish its burden of showing independence.

Employers should also note that the East Bay Drywall Court referenced prong B of the ABC test, which requires work that is “outside the employer’s usual course of business.”  The Court acknowledged that there is presently confusion regarding prong B’s interpretation with regard to remote work sites and suggested that the NJDOL should promulgate regulations clarifying the “usual course of business” requirement in light of the prevalence of remote work since the COVID-19 pandemic.

In short, in classifying New Jersey’s workforce, employers will continue to face challenges in proving that workers are independent contractors. As has been the case for some time, simply labeling a worker as a “contractor” is insufficient.  Before designating any worker as a contractor, employers are well advised to consult with counsel and review all relevant factors as the penalties for misclassification are steep.

In early 2022, New York State entered S.812B/A.2035B into law, which amended the New York State Human Rights Law, N.Y. Executive Law § 296, to require a statewide toll-free, confidential hotline (the “Hotline”) for the lodging of complaints of sexual harassment in the workplace.  On July 19, 2022, Governor Hochul announced the launch of the Hotline (1-800-427-2773 or 1-800-HARASS-3).

The Hotline is operated by the New York State Division of Human Rights (the “Division”).  The Hotline will be staffed during regular business hours and provide any caller with information on how to file a complaint with the Division. In addition, if the caller is interested, the Hotline will provide information regarding pro bono attorneys who may be able to assist and counsel complainants.  These referrals are intended to supplement (not replace) the Division’s normal complaint procedures as the new law expressly forbids attorneys who provide advice on the Hotline from soliciting further representation of any individuals whom they counsel.

Employers should immediately update all sexual harassment materials, including employee handbooks, policies, and other postings provided to employees, to include information about the Hotline.

On April 28, 2022, the New York City Council approved Int. 134-A (the “Bill”) to amend several aspects of the New York City salary disclosure law (Int. 1208-B) (the “Law”), including delaying the original May 15, 2022 effective date to November 1, 2022. The Bill is now before Mayor Eric Adams for his signature, which would enact the Bill into law.

As we previously reported, the Law requires New York City employers with four (4) or more employees to disclose minimum and maximum salary information in job postings, promotions, and transfer opportunities. On March 22, 2022, the New York City Commission on Human Rights (the “Commission”) released guidance regarding employer obligations under the Law. The Bill was introduced just two (2) days after the Commission issued this guidance.

The Bill amends the Law in the following material respects, which in some ways differ from the original version of the Bill that was first introduced:

  • As noted above, the Bill amends the effective date of the Law to November 1, 2022.
  • The Bill contains an explicit carveout to the Law’s disclosure requirements for “[p]ositions that cannot or will not be performed, at least in part, in the city of New York.” As such, the Bill clarifies that the Law does not apply to positions that cannot or will not physically be performed (at least in part) in New York City.” Notably, assuming the Bill is enacted into law and unless further guidance is issued, the Law does apply to advertisements for remote positions that can be performed wherever the employee resides as that position could theoretically be filled by a New York City resident. Therefore, any employer with four (4) or more employees and at least one (1) employee who works remotely in New York City, will need to disclose the salary range for remote positions.
  • The Bill clarifies that the salary range disclosure requirements apply to both salaried and hourly employees.
  • The Bill provides that, “[n]o person shall have a cause of action . . . for an alleged violation of this subdivision, except that an employee may bring such an action against their current employer for an alleged violation . . . in relation to an advertisement by their employer for a job, promotion or transfer opportunity with such employer.” As such, the Bill seemingly limits a private right of action under the Law to current employees and excludes applicants.
  • The Bill provides for a “safe harbor” provision for first-time offenders of the Law, which permits such covered employers to avoid a civil penalty if certain corrective actions are taken. Namely, the Bill states that upon receipt of a complaint from the Commission, covered employers will have thirty (30) days to cure any violation of the Law. Employers will then be required to submit proof that the violation has been cured and, if acceptable to the Commission, the proof “shall be deemed an admission of liability for all purposes.”

Covered employers should continue to stay up-to-date with any developments, including whether Mayor Adams signs the bill in the coming days before the original May 15, 2022 effective date. Assuming the Bill is enacted into law, the Commission indicated that it will be updating its previously issued guidance to conform to the new amendments.