New year, new laws for New York employers

Employers in New York and New York City are facing new legal requirements related to a host of issues, including pay disclosures in job postings, leave and attendance policies, breastfeeding accommodations, retaliation, the dissemination of mandatory workplace postings, human trafficking recognition training and artificial intelligence (AI).

Additionally, a recently proposed New York City bill, if enacted, would effectively eliminate at-will employment and prohibit employers from discharging employees absent just cause or a bona fide economic reason.

Below we summarize recent developments and steps for employers to consider now.

New York state joins growing list of jurisdictions requiring pay disclosures in job postings

Effective September 17, 2023, employers in New York state will be required to disclose compensation ranges in job advertisements. With Governor Kathy Hochul’s signing of Senate Bill S9427A, New York joins a growing list of jurisdictions, including New York City, requiring such disclosures in an effort to promote pay transparency and combat pay inequity and discrimination. Below we answer key questions related to the new state law:

Which employers are covered by the law?

The law applies to any person, corporation, limited liability company, association, labor organization or entity (i) employing four or more employees or (ii) acting as an employment agent or recruiter, or otherwise connecting applications with employers.  At present, it is not clear whether employees who are employed outside New York count towards the statutory threshold.  We will monitor any forthcoming rules and regulations that may provide further guidance on this and other aspects of the law.

What does the law require?

The law requires any employer, employment agency, employee or agent thereof to include in any advertising for a job, promotion or transfer opportunity that can or will be performed at least in part in New York, the position’s (i) compensation or “a range of compensation for such job,” and (ii) job description, if such description exists.

“Range of compensation” is defined as “the minimum and maximum annual salary or hourly range of compensation for a job, promotion, or transfer opportunity that the employer in good faith believes to be accurate at the time of the posting of an advertisement for such opportunity.”

Advertisements for positions paid solely on commission are required to disclose “in writing in a general statement that compensation shall be based on commission” to maintain compliance with the law.

The law also requires employers to keep and maintain relevant records, including, but not limited to, the history of compensation ranges for each position and the job descriptions for such positions, if such descriptions exist.

Does the law apply to job postings for positions outside of New York?

The law applies to all positions “that can or will be performed, at least in part, in the state of New York.” Thus, the law’s requirements may be deemed to apply to (a) covered employers hiring for fully remote positions, because such a role hypothetically could be filled by an employee sitting in New York, and (b) positions where the employee may be required periodically to come into New York, such as a generally remote/hybrid position that requires occasional attendance at the employee’s New York offices for meetings.

Are there any exemptions to the new pay transparency law?

The law does not apply to “temporary help firms,” defined as “a business which recruits and hires its own employees and assigns those employees to perform work at or services for other organizations, to support or supplement the other organization’s workforce, or to provide assistance in special work situations such as, but not limited to, employee absences, skill shortages, seasonal workloads, or to perform special assignments or projects.”

The law does not address the issue of whether covered employers that work with temporary help firms are required to comply with the law.

Who may file a complaint for violations of the law?

Any person claiming to be aggrieved by a violation of the law may file with the New York Labor Commissioner a complaint for an investigation of such complaint. There is no private right of action for an employee to file a lawsuit against the employer.

What are the potential civil penalties for violating the law?

Employers found to be in violation of the law face civil penalties up to $1,000 for a first violation, $2,000 for a second violation or $3,000 for a third or subsequent violation. In assessing the amount of the penalty, the Commissioner shall consider the following factors: (i) the size of the employer’s business, (ii) the good faith of the employer to believe that its conduct was in compliance with the law, (iii) the gravity of the violation and (iv) the history of previous violations.

The statute directs the Labor Commissioner to promulgate rules and regulations effectuating the statute’s provisions and to conduct a public awareness campaign to make sure employers are aware of their obligations. We therefore anticipate additional guidance interpreting the statute’s practical application will be issued by the Commission prior to its effective date.

As noted in our alert, New York City’s salary posting requirements took effect on November 1, 2022.

Other jurisdictions in the US and globally are similarly taking steps, including salary posting and/or reporting requirements to address pay equity issues.

Amendment to NYLL prohibits employers from penalizing employees for protected absences

On November 21, 2022, Governor Hochul signed Senate Bill S1958A, which amends Section 215 of the New York Labor Law (NYLL) to prohibit employers from penalizing workers for taking legally protected time off. Effective February 19, 2023, employers may not “assess[] any demerit, occurrence, any other point, or deductions from an allotted bank of time, which subjects or could subject an employee to disciplinary action” for the employee’s use of “any legally protected absence pursuant to federal, local or state law.” The law further makes it unlawful for employers to fire, threaten or otherwise discriminate or retaliate against any employee for their use of legally protected absences.

Section 215 of the NYLL provides employees a private right of action against employers or persons alleged to have violated the law. Employees may seek equitable relief and/or monetary damages, including liquidated damages, costs and reasonable attorneys’ fees. Additionally, if the New York State Department of Labor Commissioner finds an employer violated the law, it may order any relief it deems appropriate, including a civil penalty between $1,000-$10,000 for a first offense, and between $1,000-$20,000 for a second offense within six years of the first; payment of monetary and liquidated damages to aggrieved employees; and the rehiring or reinstatement of aggrieved employees.

Employers are encouraged to review their policies and practices, including “no fault” attendance policies to ensure they are prepared to comply with the new law. In addition, employers may want to train managers and supervisors on the various types of protected leave under local, state and federal law.

New state law expands breastfeeding accommodations

New York Senate Bill S4844B, signed by Governor Hochul on December 9, 2022 and scheduled to take effect on June 7, 2023, expands the rights of nursing employees to express milk. Specifically, the law requires private employers to “designate a room or other location” for employees to express breast milk each time such employee has reasonable need for up to three years following childbirth. The room or location provided must be (i) “in close proximity to the work area,” ii) “well lit,” iii) “shielded from view” and (iv) “free from intrusion from other persons in the workplace or the public.” Additionally, the room must provide, at a minimum, a chair, working surface, nearby access to clean running water and an electrical outlet (if the workplace is supplied with electricity). If the workplace has access to refrigeration, the employer must also allow employees access for the purpose of storing expressed milk.

If the lactation room is not solely dedicated for the purpose of allowing employees to express milk, the room must “be made available to such an employee when needed and shall not be used for any other purpose or function while in use by such employee.” The law does provide a limited exception for employers where compliance would be “impracticable because it would impose an undue hardship on the employer by causing significant difficulty or expense when considered in relation to the size, financial resources, nature or structure of the employer’s business.” Such employers are obligated to “make reasonable efforts” to provide a room or other location, “other than a restroom or toilet stall,” that is close to the work area where employees can express breast milk in privacy.

The new law further requires the commissioner to develop and implement a written policy regarding the rights of nursing employees to express breast milk in the workplace and provides that employers will be required to provide the policy to each employee upon their hire and annually thereafter and to employees returning to work following the birth of a child. The law also prohibits an employer from discriminating or retaliating against any employee for exercising their rights under the law.

Employers are encouraged to review their employee breastfeeding policies and the spaces provided based on the new requirements.

New York expands paid family leave to include siblings

On November 1, 2021, Governor Hochul signed Senate Bill S2928A to expand New York State’s Paid Family Leave Law (NYPFLL) to allow employees leave to care for siblings with a serious health condition. The law, which took effect on January 1, 2023, adds siblings, including biological siblings, adopted siblings, step-siblings and half-siblings to the definition of “family members” for purposes of paid family leave.

Employers are urged to review their paid family leave policies and practices to ensure compliance with the expanded law.

New York extends paid leave for COVID-19 vaccinations

Last year Governor Hochul signed a bill extending the state’s COVID-19 vaccine paid leave law for an additional year to December 31, 2023. Under the law, all New York employers are required to provide employees with a sufficient period of paid time off to be vaccinated for COVID-19, up to four hours per vaccine injection. The New York State Department of Labor previously provided guidance on the paid leave requirement, including FAQ.

New York requires employers to provide workplace notices electronically

Senate Bill S6805, signed by Governor Hochul on December 16, 2022, with immediate effect, amends New York labor law to require employers to provide digital versions of all documents required to be physically posted at a worksite under federal and state law. Documents must be made available through the employer’s website or by email. Employers are also required to notify employees that required postings are available electronically.

New York City issues proposed rules to implement AI law

Late last year, the New York City Department of Consumer and Worker Protection (DCWP) published updated proposed rules to implement Local Law 144 of 2021 regulating employers’ use of automated employment decision tools (AEDT). The new law, which is scheduled to take effect on April 15, 2023 (delayed from January 1), prohibits covered employers and employment agencies from using an automated employment decision tool to screen a candidate or employee for an employment decision unless (a) the tool has been subject to a bias audit by an independent auditor no more than one year prior to the use of such tool, (b) information about the bias audit is publicly available and (c) certain notices have been provided to employees or job candidates who reside in the city of the use of the tool no less than ten business days before such use and the right of a candidate or employee to request an alternative selection process or accommodation.

The updated proposed rules address various comments and include the following changes:

• Modify the definition of AEDT to provide that it will be deemed to substantially assist or replace discretionary decision making under Local Law 144 if it “use[s] a simplified output to overrule conclusions derived from other factors including human decision-making”
• Clarify that an “independent auditor” must be capable of “exercising objective and impartial judgment on all issue within the scope of the audit and disqualifying characteristics (eg, may not be employed or have a financial interest in an employer or employment agency that seeks to use or continue to use an AEDT or in a vendor that developed or distributed the AEDT)
• Revise the required calculation to be performed where an AEDT scores candidates
• Clarify that the required “impact ratio” must be calculated separately to compare sex categories, race/ethnicity categories and intersectional categories
• Clarify the types of data that may be used to conduct a bias audit, including “historical data”
• Clarify that multiple employers using the same AEDT may rely upon the same bias audit so long as they provide historical data, if available, for the independent auditor to consider in such bias audit and
• Clarify that an AEDT may not be used if its most recent bias audit is more than one year old.

The DCWP will hold a public hearing on the updated proposed rules on January 23, 2023, with the comment period closing the same day. In the meantime, employers and employment agencies that utilize AEDT are urged to consider how to comply with the law’s requirements based on the updated proposed rules.

Employers in other jurisdictions are also encouraged to monitor increasing regulatory activity related to AI and workplace technologies.

NYC proposed bill would limit the ability of employers to discharge employees and use electronic monitoring

A proposed bill being considered by the City Council’s Committee on Consumer and Worker Protection would prohibit employers from terminating employees without just cause. It would also prohibit, with certain exceptions, the use of electronic monitoring in discharging or disciplining employees.

Introduced on December 7, 2022, Int 837 would amend the New York City Just Cause Law (which took effect on July 4, 2021) to apply to most private employers. Under the proposed bill, an employer would be prohibited from discharging an employee who has completed a probation period except for just cause or a bona fide economic reason.

In determining whether an employee was discharged for just cause, the fact-finder would be required to consider seven factors (in addition to any other relevant factors):

1. Whether the employee knew or should have known of the employer’s policy, rule or practice or performance standard that is the basis for progressive discipline or discharge
2. Whether the employer provided relevant and adequate training to the employee
3. Whether the employer’s policy, rule, [or] practice or performance standard, including the utilization of progressive discipline, was reasonable and applied consistently
4. Whether the employer impermissibly relied on electronic monitoring
5. Whether the employer disciplined or discharged the employee based on that employee’s individual performance, irrespective of the performance of other employees
6. Whether the employer undertook a fair and objective investigation into the job performance or misconduct and
7. Whether the employee violated the policy, rule or practice, failed to meet the performance standard or committed the misconduct that is the basis for progressive discipline or discharge.

In addition, for a termination to be based on just cause, the employer would be required to (1) use progressive discipline and (2) have provided to the employee and posted at the workplace or job site its written policy on progressive discipline.  The employer bears the burden of proof by a preponderance of the evidence.

Additionally, the bill requires employers to provide 14 days’ notice of any discharge and, within 5 days of such notice, provide a written explanation to the employee of the precise reasons for discharge, including a copy of any materials, personnel records, data or assessment that the employer used to make the decision.  If the employer is relying on data collected through electronic monitoring, the employer would also be required to provide any aggregated data collected on employees performing the same or similar functions at the same establishment for six months prior to the discharge.

These requirements would not apply to terminations based on an employee’s egregious misconduct or egregious failure to perform their duties. 

For a discharge to be based on a bona fide economic reason, the employer would be required to demonstrate a full or partial closing of operations or technological or organizational changes to the business in response to a reduction in volume of production, sales or profit of 15 percent or more over a period of two quarters either at the establishment where the discharge is to occur or across all establishments owned by the employer within the city (excluding redundancies created by a merger or acquisition). 

If enacted, the bill would also prohibit employers from relying on data collected through electronic monitoring in discharging or disciplining an employee, unless the employer can establish before each use that (i) there is no other practical method of tracking or assessing employee performance, (ii) it is using the least invasive available form of electronic monitoring available and (iii) it previously provided the employee with the required notice of monitoring.  In addition, the employer must show that it previously filed with the Department of Consumer and Workforce Protection “an impartial evaluation from an independent auditor that said electronic monitoring is effective in undertaking its designated task.” Even then, an employer cannot rely solely on the data, but must also use “other means of assessment such as manager observation or interviewing clients, customers or other employees to solicit feedback.”

The proposed bill further outlines permissible uses of data gathered through electronic monitoring (eg, to record the start or end of work shifts), as well other limitations and requirements on the use such data for discipline and termination.

The proposed bill outlines remedies available to employees for violations of the law, including attorneys’ fees and costs and reinstatement. It also permits any person or organization representing persons alleging a violation of the law to bring an arbitration proceeding or a civil action within two years of the date the employee knew or should have known of the alleged violation.

If you have any questions regarding these or other employment law developments in New York, please contact the authors or your DLA Piper relationship attorney. For more information about employment developments and trends, see our Top 10 expected trends for US employers to know in 2023.