On the last day of its legislative session, the New York State Senate and Assembly passed sweeping reforms meant to overhaul the state's antidiscrimination laws. Governor Andrew Cuomo, who advocates for more robust workplace harassment laws, is expected to sign the bill without delay. Once enacted, the amendments will impact every workplace in New York.
The legislation is an omnibus bill that amends different provisions of the New York State Human Rights Law (NYSHRL), the General Obligations Law, the Civil Practice Law and Rules, and the New York Labor Law. Together, these amendments provide for significant changes to New York's already expansive workplace harassment laws. Here are the specific requirements.
Small Employers
Currently, the NYSHRL only applies to New York employers with four or more employees, except for claims involving discrimination based on sex, which currently apply to all sized employers. Under the amended law, the NYSHRL will apply to even the smallest New York employers, effective 180 days after the bill becomes law. The amendment will apply only to claims filed on or after the effective date.
Harassment Claims
Under long-standing precedent, conduct must be "severe or pervasive" to be considered harassment, which is a relatively high standard. The amendments will eliminate the current standard for sexual harassment claims—as well as harassment and retaliation claims alleging misconduct based on any protected characteristic.
Going forward, the law significantly lowers the bar for workers to establish a claim for harassment based on age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, domestic violence victim status or because the individual has opposed discrimination or filed a complaint, testified or assisted in any proceeding regarding discrimination.
Additionally, the amendments erode a longstanding employer defense to harassment claims. Known as the Faragher-Ellerth defense (based on two U.S. Supreme Court decisions from 1998), an employer is able to defeat a federal harassment claim if the employee failed to take advantage of preventative or corrective opportunities provided by the employer, such as failing to report alleged misconduct despite the employer's maintenance of an appropriate reporting mechanism. Under the amendments, the fact that an employee did not make a complaint about the harassment "shall not be determinative" of an employer's liability, bringing the NYSHRL in line with its New York City counterpart.
Finally, the amendments codify a narrow affirmative defense for employers, where the employer can establish that the alleged harassment does not rise above the level of "petty slights or trivial inconveniences," viewed through the lens of a reasonable victim of discrimination with the same protected characteristic as the complainant.
These provisions will take effect 60 days after the bill becomes law and will not apply retroactively to previously filed claims. There is already an amendment to this bill that has been passed by the Senate, but not yet the Assembly, that would clarify that the new laws will only apply to claims that accrue after the effective date. The Assembly's failure to act will create a strong likelihood that informed employees whose claims are based wholly on pre-amendment conduct will simply wait to file so as to gain the benefits of the amendments.
Nonemployees
Last year, New York expanded coverage of the state's sexual harassment laws to nonemployees in the workplace. The new legislation goes further, extending all of the state's anti-harassment laws to nonemployees. Businesses will now be liable for harassment directed towards contractors, subcontractors, vendors, consultants or any other person providing services in the workplace, so long as the business, its agents or supervisors "knew or should have known" the nonemployee was harassed in the workplace and failed to take appropriate corrective action. This provision will take effect 60 days after the bill is enacted and will only apply to claims filed after the effective date.
Additional Damages
Currently, the NYSHRL does not provide for awards of attorney fees or punitive damages to a successful claimant. The amendments will allow recovery of both.
These provisions will take effect 60 days after the bill becomes law and will not apply retroactively to claims filed prior to that date. Note that there is already a bill passed by the Senate, but not yet the Assembly, to soften this provision by making an award of attorney fees discretionary, rather than mandatory.
Limits on Confidential Settlements
The 2018 expansion of New York's sexual harassment laws already prohibited the inclusion of nondisclosure clauses in settlement of sexual harassment claims, unless the alleged victim explicitly wanted the clause. The current amendments expand this prohibition to include any type of discrimination claim.
Confidentiality language may only be included if that is the employee's expressed preference. The employee must be given at least 21 days to consider whether to accept confidentiality language, and then has seven days to revoke that acceptance. Further, any such nondisclosure term will be void if it prohibits the individual from participating in an investigation with the Equal Employment Opportunity Commission (EEOC), New York State Division of Human Rights (NYSDHR), or similar local agency, or if restricts the disclosure of any facts necessary to receive unemployment insurance, Medicaid or other public benefits to which the individual may be entitled. These provisions will take effect 60 days after the law is enacted.
Limits on Mandatory Arbitration Agreements
Similarly, the new law extends last year's prohibition against contracts that mandate arbitration of sexual harassment claims to claims involving any type of discrimination. It is yet to be seen whether and to what extent this provision will be enforceable in light of the Federal Arbitration Act—and legal challenges are expected. This law will take effect 60 days after the bill is signed into law.
Finally, the law extends confidentiality prohibitions beyond the settlement context. The legislation renders void any contractual agreement between an employer and any employee or potential employee that prevents disclosure of factual information related to any future claim of discrimination, unless the provision notifies employees that they are not prohibited from speaking with law enforcement, the EEOC, the NYSDHR, a local human rights agency or an attorney retained by the employee. This provision will apply to contracts entered into on or after Jan. 1, 2020.
Sexual-Harassment-Prevention Training
Last year's sexual harassment laws ushered in mandatory sexual-harassment-prevention policy and training obligations and standards. The current legislation constructs additional administrative hurdles.
The new law requires that at both the time of hire and at every annual sexual-harassment-prevention training, employees must receive a notice containing a copy of the employer's sexual-harassment policy, as well as the information presented at the employer's harassment-prevention training (in English and in the primary language of the employee). This provision will take effect immediately upon enactment.
Statute of Limitations
Under current state law, an individual must file a NYSHRL claim with the Division of Human Rights within one year but has three years to file in court. Under the amendments, the three-year limit will apply to complaints filed directly with the division as well. This will take effect one year after enactment.
Model Policy and Training
As part of the law requiring all employers to adopt a sexual harassment prevention policy and to conduct sexual harassment prevention training, the New York State Department of Labor and the NYSDHR were tasked with developing both a model sexual-harassment policy and model training program. The models were released in August 2018. Under the new amendments, the NYDOL and NYSDHR must re-evaluate and update the models every four years, beginning in 2022.
What Should New York Employers Do Now?
These sweeping reforms will impact every employer and business in the state. Employers must be prepared for strengthened laws aimed at targeting harassment in the workplace. Lowering the high bar of having to prove "severe and pervasive" behavior will make it easier for employees to bring harassment claims in court, and an employer's use of the Faragher-Ellerth defense will be limited. Coupled with punitive damages and attorney fee awards, we expect to see an increase in workplace harassment lawsuits.
It is imperative that employers take measures to ensure their workplaces are free from discrimination and harassment. Additionally, they may need to revise existing arbitration agreements, standard settlement agreements or any contract with employees that requires confidentiality. Employers must also be sure to take the steps necessary to meet the additional administrative requirements associated with the mandatory sexual-harassment-prevention policy and training.