6.25.19

In 2018, New York State and New York City lawmakers toughened their sexual harassment laws.  But New York State lawmakers were not done. A few days ago, they passed a bill that would dramatically expand existing sexual harassment and other discrimination protections. If Gov. Andrew Cuomo (D) signs the legislation into law, which he is almost sure to do, the changes will apply to all employers in the state and not just those in New York City.

Here are the key provisions:

New York State Human Rights Law would cover all employers. The legislation would expand coverage under the New York State Human Rights Law to all employers, regardless of size. This provision would take effect 180 days after enactment for claims filed after that date.

Non-employees protected. Employers would be liable for harassment of “non-employees,” including contractors, subcontractors, vendors, consultants, or anyone else providing services in the workplace if the employer knew or should have known about the harassment and failed to take appropriate corrective action. This provision would take effect 60 days after enactment for claims filed on or after that date.

Liberal interpretation required. The legislation would require courts to interpret the New York State Human Rights Law liberally and to construe exceptions narrowly to “maximize deterrence of discriminatory conduct,” even if there is a different result under federal law. This provision would be effective immediately upon enactment.

Easier for plaintiff to prove harassment claim. The legislation would make three plaintiff-friendly changes to harassment law:

First, employers would no longer be able to defeat harassment claims by arguing that the conduct was “not severe or pervasive.” Harassment based on a protected category would be unlawful “regardless of whether such harassment would be considered severe or pervasive.” Employers would be able to defeat harassment claims only by proving that the conduct was no more than “petty slights and trivial inconveniences.”

Second, employers would no longer be able to rely on the Faragher-Ellerth defense. This defense is based on two Supreme Court decisions in sexual harassment cases brought under federal Title VII. Under Faragher-Ellerth, if the harassment does not result in a “tangible job detriment,” the employer can prevail by showing that it had measures in place to prevent and correct harassment, and that the plaintiff unreasonably failed to use those measures. Under the New York legislation, the fact that an employee did not make a harassment complaint would “not be determinative” of an employer’s liability.

Third, employees would not have to provide comparator evidence to establish discrimination. In other words, they would not have to present evidence that they were treated less favorably than a similarly-situated employee outside of their protected category.

Statute of limitations extended for filing sexual harassment complaints. The legislation would extend to three years the time for a complainant in a sexual harassment case to file with the New York State Division of Human Rights. This provision would take effect one year after enactment for claims filed after that date.

Mandatory attorneys’ fees. If an individual prevails in a lawsuit or administrative complaint under the New York State Human Rights Law, attorneys’ fees would have to be awarded. This would take effect immediately upon enactment.

Punitive damages available. Prevailing plaintiffs would be able to recover punitive damages under the legislation. This provision would take effect 60 days after enactment for claims filed on or after that date.

More sexual harassment training and policy requirements. At the time of hire and at every sexual harassment training session, employees would have to receive their own copies of the employer’s sexual harassment policy and the information presented at the company’s sexual harassment training (in English and in the employees’ primary languages). This requirement would take effect upon enactment.

Updates to state’s model sexual harassment policy and training program. Effective at the beginning of 2022, the state would be required to update its model harassment policy and model training program every four years.

Non-disclosure restrictions apply to discrimination and retaliation claims, as well as harassment claims. The 2018 law restricted confidentiality provisions in settlement agreements of sexual harassment claims. The new law would extend that restriction to any discrimination or retaliation claim unless it is the employee’s “preference.” To show this preference, the employee would have to be provided 21 days to consider whether to accept the confidentiality provision and then seven days to revoke acceptance, similar to the “single termination” waiting periods under the federal Older Workers Benefit Protection Act. But under the New York legislation, the employee cannot waive the 21-day “consideration” period. This provision would take effect 60 days after enactment for settlements entered into on or after that date.

Restrictions on confidentiality provisions in employment agreements. Effective January 1, 2020, employment agreements would not be allowed to prohibit employees from disclosing facts related to future discrimination claims unless the agreements made exceptions for law enforcement, the U.S. Equal Employment Opportunity Commission, the New York State Division of Human Rights, a local human rights agency, or employees’ attorneys.

Mandatory arbitration prohibited for discrimination, as well as harassment, claims. The 2018 law prohibited mandatory arbitration of sexual harassment claims. The new law extends that prohibition to any discrimination claim under the New York State Human Rights Law. This provision would take effect 60 days after enactment, but it would probably be preempted by the Federal Arbitration Act.

Recommendations for employers 

If enacted (as we expect), this legislation will be manna from heaven for plaintiff-side employment lawyers in New York. They will use this law to file more lawsuits, defeat more summary judgment motions, and obtain more damages at trial. Even if a case settles, plaintiffs will have significantly more leverage, and employers will have to deal with the waiting periods when drafting confidentiality language in settlement agreements.

We recommend that employers with New York operations take these steps:

  • Ensure equal employment opportunity, discrimination, and harassment policies are robust and vigorously enforced. Those polices should apply to all categories protected under state law: age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, and domestic violence victim status.
  • Amend harassment policies so that they cover contractors, subcontractors, vendors, consultants, and any other person providing services in the workplace.
  • Consider obtaining employment practices liability insurance to cover the increased costs of litigation and settlement.
  • Revise annual sexual harassment training programs to cover not only sexual harassment but also harassment based on any protected characteristic.
  • Ensure at the time of hire and at every harassment training class that employees receive copies of the sexual harassment policy and information presented during the training, both in English and the employees’ primary languages.
  • Review the state’s periodic updates to its model sexual harassment policy and training program so that the company’s harassment policy and training meet or exceed the state standards.
  • Consider revising mandatory arbitration agreements for employment discrimination claims. Although the state’s prohibition on those agreements is likely to be challenged as preempted by the Federal Arbitration Act, there have been no New York court decisions on the issue.
  • Revise the company’s employment contract and standard settlement agreements so they comply with the new restrictions on confidentiality provisions.

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