Blog Posts
Labor and Employment
In a 2019 Decision, the NLRB Establishes a (Not So) New Independent Contractor Test
Originally posted on 2/18/2019, content updated on 10/13/2023 In 2019, the National Labor Relations Board (NLRB) revised its independent contractor test, overturning a controversial standard established in 2014. The decision was a federal attempt to clarify the legal distinction between employees and independent contractors. Although many employers struggle to differentiate the two, one category is afforded certain rights and protections, while the other is not. Under the National Labor Relations Act (NLRA), employees are permitted to unionize; independent contractors are not. Similarly, contractors are not entitled to the same protection from unfair labor practices employees receive. Independent contractors also must pay their own income taxes, Medicare, and Social Security. Traditionally, the NLRB has used a 10-factor, common-law test to guide every determination about whether a worker should be classified as an employee or independent contractor under the NLRA. Those factors are as follows: The extent of control which, by the agreement, the master may exercise over the details of the work. Whether or not the one employed is engaged in a distinct occupation or business. The kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision. The skill required in the particular occupation. Whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work. The length of time for which the person is employed. The method of payment, whether by the time or by the job. Whether or not the work is part of the regular business of the employer. Whether or not the parties believe they are creating the relation of master and servant. Whether the principal is or is not in business. At the core of this test is the question of “entrepreneurial opportunity”: the measure of an individual’s ability to develop and manage a business on their own terms. In its decision in FedEx Home Delivery, 361 NLRB No. 55 (2014), the Board amended this long-standing system. First, the Board placed greater emphasis on “actual, not merely theoretical, entrepreneurial opportunity” and what effect an employer may have on a worker’s ability to pursue the opportunity. Second, the Board proclaimed it would start considering any evidence suggesting a company controlled a contractor’s capacity to operate an independent business. Together, these elements deemphasized the entrepreneurial opportunity question and placed a greater burden on companies to prove their workers were properly classified—that purported independent contractors were not, in fact, employees. On January 25th, 2019, the NLRB reversed its previous decision and returned to its pre-FedEx test. The news should come as a relief to employers who felt over-encumbered by the 2014 rule. Regardless, the decision does not erase the risk of a worker misclassification claim. Note that the NLRB considers the merits of every claim individually and that no single factor automatically sways the Board’s determination. If you have any questions about worker misclassification or any other Labor and Employment Law matter, please contact Richard Romeo at rromeo@offitkurman.com or 347.589.8547.
October 13, 2023
Labor and Employment
Gender Identity and Expression Are Now Protected Characteristics Under New York State Law
Originally posted on 03/12/2019, content updated on 10/11/2023 On Sunday, February 24, 2019, the Gender Expression Non-Discrimination Act (GENDA) went into effect in the state of New York. The law safeguarded transgender and gender nonconforming people from discrimination by designating gender identity and gender expression as protected characteristics under New York’s human rights and hate crimes laws. Other protected characteristics in New York include sex, sexual orientation, race, religion, and disability status. In January 2019, former Governor Andrew Cuomo signed GENDA into law, following years of advocacy from transgender activists and other LGBTQ community leaders. GENDA prohibits gender identity and expression-based discrimination in the areas of employment, housing, and public accommodations. It is not the first state law to provide such protections. Eighteen other states, as well as the District of Columbia, have similar statutes in place. As of this writing, no analogous federal law exists. Multiple studies have shown that transgender and gender-nonconforming individuals face disproportionate rates of discrimination and harassment in the workplace. According to the United States Transgender Survey, for instance, 30% of transgender and gender nonconforming workers said they had been terminated, denied a promotion, or harassed at work due to their gender identity. Employers in New York should review and, if necessary, revise their policies and employee handbooks to conform to the new law. Best practices include the following: Ask employees about their preferred pronouns and use those pronouns in every form of communication. Allow employees to use their chosen names (even if a legal name change has not been completed) in email addresses, identification cards, and other organizational documents. Ensure every employee has access to a restroom that conforms to their gender identity—and consider creating gender-neutral, single-occupancy facilities or stalls. Adopt gender-neutral language in any dress code policy, and remove any language that identifies an item of clothing with a specific gender. To ensure GENDA compliance, employers should speak to their legal advisors as soon as possible. If you have any questions about this law or any other Labor and Employment Law matter, please contact me at rromeo@offitkurman.com or 347.589.8547.
October 11, 2023
Labor and Employment
New York City Employers: Do You Know All the Labor and Employment Laws that Apply to Your Business?
Originally posted on 06/11/2019, content updated on 10/09/2023 Business owners in and around New York City have a greater number of legal obligations than do employers in almost every other region in the United States. Why? Because New York City business owners stand at the intersection of three sets of rigorous labor and employment laws. Federal Laws that Apply to Business Owners in and Around New York City Regardless of their location, size, or industry, all employers in the US must follow certain labor and employment laws. These include, but are not limited to, the following: The Occupational Safety and Health Act (OSHA), which requires employers to maintain safe working environments. Title VII of the Civil Rights Act, which protects workers from discrimination on the basis of race, color, religion, sex, age, national origin, and other specified characteristics. The Americans with Disabilities Act (ADA), which prohibits discrimination on the basis of disability and obligates employers to provide reasonable accommodations for people with disabilities. The Family Medical Leave Act (FMLA), which requires certain “covered” employers to provide employees with unpaid leave under certain qualified circumstances. Other federal labor and employment laws that may impact your business include regulations related to employee benefits, unions, family and medical leave, veterans, and more. State Laws that Apply to Business Owners in and Around New York City In addition to federal laws enforced by the Department of Labor, New York employers face a large number of state-level regulations and requirements in categories such as the following: fair employment equal pay salary history questions overtime background checks healthcare and benefits pregnancy accommodations paid family leave and other paid time off whistleblower protections smoke-free workplaces The state’s equal employment opportunity (EEO) rules are broader as well. Employers may not discriminate against victims of domestic violence, on the basis of an individual’s sexual orientation, or—as codified by the recent passage of GENDA—on the basis of gender identity and expression. Local Laws that Apply to Business Owners in and Around New York City New York City has a wide array of workplace laws, many of which reach beyond state and federal rules in areas such as the following: sexual harassment and discrimination in the workplace (read about the “Stop Sexual Harassment in NYC Act” here) paid sick leave employees’ rights to organize safe and healthy workplaces Also in place in New York City are various industry-specific regulations, creating additional requirements for fast food establishments, groceries, apparel makers, nail salons, construction firms, and other particular kinds of businesses. Navigating Your Many Legal Requirements The sheer number of laws out there can be dizzying for business owners—and this overview is far from exhaustive. Moreover, if you are located in Nassau, Suffolk, or Westchester Counties in New York, or in Bergen County in New Jersey, there may be additional laws in those particular counties to keep in mind. To stay on top of the myriad rules that apply to your business, you will need more than a simple list of what you can and cannot do. As a business owner, you need to make sure to a) comply with all applicable laws, and b) understand the nuances of and interactions between those laws. For example, you can ask a potential employment candidate about a felony conviction in New York State, but in NYC, you can only ask that question after a conditional offer of employment has been made. In either case, you may not use that felony conviction to deny the applicant the job unless that conviction relates to the job. Say you are hiring someone as a school bus driver, and they were arrested for fraud and embezzlement. As long as they will not have any access to money in their role, you might have a problem denying that person the school bus job even in light of their past conviction. This might not be the case, however, if that prior conviction was for sexual offenses against children. In any event, if the applicant is denied employment based upon that conviction, the employer must provide a written statement explaining the reasons for this denial within 30 days of the applicant’s request. These are critical concerns for any employer, especially any small to mid-sized company. A single lawsuit brought under federal, state, or local regulations can have catastrophic effects on the future of your business. Until next time, if you have any questions about the rules that apply to your business, or any other Labor and Employment Law matter, please contact me.
October 9, 2023
Labor and Employment
Employers, Know Your FLSA Basics
Originally posted on 07/5/2019, content updated on 10/05/2023 Are you aware of your obligations under the Fair Labor Standards Act (FLSA)? Do you understand the differences between the FLSA and similar state statutes? A surprisingly large number of decision-makers in established businesses are unable to sufficiently answer these questions. That can be a serious problem. Uncertainty around labor laws can expose a company to numerous legal and financial risks, including lawsuits and Department of Labor investigations that may result in the company owing back wages plus civil penalties and even attorneys’ fees. What Is the FLSA? The FLSA is a federal statute that guarantees “non-exempt” employees the right to a minimum hourly wage, as well as time-and-a-half “overtime” compensation for any hours worked in excess of 40 hours in any given week. Since its passage in 1938, the law has been amended numerous times, but some form of minimum wage and overtime provisions have generally remained in place. However, there are also many state and local minimum wage and overtime laws in place and if those laws provide greater benefits or protections to workers than does the FLSA, then in such cases, employers must comply with those more stringent state and local laws. First, under certain circumstances and in certain industries and trades, not all employees must be paid an hourly wage equal to the minimum wage. A worker who “customarily and regularly” earns a certain amount of tips each hour, and that amount varies by industry and geographic location in New York State, may be paid an hourly wage less than the New York minimum wage, so long as the employee’s total compensation is equal to or greater than what the employee would make otherwise. Second, some employees, such as executives and salespeople, may also be exempt from overtime pay under the FLSA. Employers must be careful when classifying workers as exempt or non-exempt, as the distinction is nuanced and multifaceted. Third, the FLSA is federal law. It applies to many businesses in the United States. However, employers must also follow wage and hour laws in any state and city in which they have employees—and state and local rules may hold businesses to different standards. For instance, New York’s minimum wage is higher than the federal minimum wage. In this and any other similar instances, the highest minimum wage applies. How Can You Avoid an FLSA Violation? FLSA violations can result in substantial damages for employers. Businesses that fail to properly pay their employees may face DOL penalties of tens of thousands of dollars, or even millions. To stay on the right side of the law, stick to the following practices: Properly classify every employee as exempt or non-exempt. Keep accurate records of how many hours your employees work each week. Make proper calculations for overtime. An experienced labor and employment attorney can help you understand your legal obligations, address any existing liabilities, and ensure compliance with the FLSA as well as state and city wage and hour laws. If you have questions about this or any workforce legal matter, please contact me. Until next time, if you have any questions about the rules that apply to your business, or any other Labor and Employment Law matter, please contact me.
October 5, 2023
Labor and Employment
New York’s Harassment and Discrimination Laws Just Changed—Again. Is Your Business Up to Date?
Originally posted on 09/16/2019, content updated on 10/03/2023 Less than a year after substantial changes were enacted in 2018, New York State laws concerning harassment and discrimination in the workplace are changed once again. An omnibus bill amended various 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. Continue reading for an overview of what the new laws entail, along with their effective dates. Expanded Coverage for Employers and Workers Small businesses, take note: NYSHRL now applies to all private employers. That means every person or entity, regardless of size, must comply with state-level harassment prevention regulations, including annual harassment prevention training. The statutes also broadened the scope of worker protections. Domestic workers, such as housekeepers and gardeners, are now covered under laws prohibiting employment discrimination. Non-employees, including independent contractors, subcontractors, vendors, consultants, and other service providers, are similarly protected from any unlawful discriminatory practices—not only sexual harassment. Effective date: Already in effect as of October 11, 2019 New Sexual Harassment Prevention Policy Document Requirements Employers must now provide every employee with a written notice containing the employer’s sexual harassment prevention policy. This document must be provided at the time of hiring and once per year, during annual anti-harassment training. The policy should be available in English as well as any other language an employee identifies as their primary language. Employers need not attempt to craft such notices alone, as The New York Department of Labor (DOL) is responsible for preparing model sexual harassment prevention policy and training templates. If an employee requests a template in a certain language that is not available, the employer can provide the employee with the English-language notice. Employers will not be penalized for errors or omissions in any non-English forms created by the DOL. Effective date: Already in effect as of August 12, 2019 The End of the “Severe or Pervasive” Standard Previously, allegations of harassment or other forms of workplace discrimination needed to demonstrate “severe and pervasive” misconduct. The new laws remove this standard. Additionally, alleged harassment no longer needs to be “unwelcome.” The laws do stipulate, however, that “the harassing conduct [must] rise above the level of what a reasonable victim of discrimination with the same protected characteristic would consider petty slights or trivial inconveniences.” Effective date: Already in effect as of October 11, 2019 Faragher–Ellerth Defenses Thrown Out In New York and elsewhere, employers have often successfully avoided liability for harassment by using the so-called “Faragher–Ellerth” defense. The defense essentially reasons that employees should first report any incident internally, so that the employer can have the opportunity to resolve or remediate the issue before commencing any legal proceedings. New York’s new laws eliminate this defense. In other words, an employee no longer needs to file a complaint with their employer before taking the matter to court. Effective date: October 11, 2019 An Across-the-Board Ban on Mandatory Arbitration in Employment Agreements The New York laws enacted in 2018 prohibited employers from requiring mandatory arbitration to resolve sexual harassment claims. The amendments widened this to include all kinds of employment discrimination. Effective date: Already in effect as of October 11, 2019 Current Restrictions on NDAs Employers can no longer require, as a condition of the settlement of any employment discrimination claim, any terms or conditions which prohibit disclosure of the underlying facts and circumstances of the discrimination claim, unless such is the complainant’s preference. In that case, the complainant will have 21 days to consider that preference, and such confidentiality provisions must be memorialized in a separate writing signed by all parties. Additionally, for a period of seven days, the complainant shall have the right to revoke such confidentiality agreement, and such confidentiality agreement shall not become effective or enforceable until such revocation period has expired. Effective date: Already in effect as of October 11, 2019 Future Restrictions on NDAs Any provision in any contract between an employer and any employee or potential employee entered into after January 1, 2020, which prohibits the disclosure of factual information related to a future claim of discrimination is void and unenforceable unless such provision notifies the employee or potential employee that it does not prohibit him or her from speaking with law enforcement, the employee’s attorney, or any federal, state, or local agency that enforces employment discrimination laws. Effective date: Already in effect as of January 20, 2020 A Longer Statute of Limitations for Sexual Harassment The statute of limitations for sexual harassment claims has been extended from one year to three years after the date of the alleged harassment. The statute of limitations for all other forms of employment discrimination remains at one year. Effective date: Already in effect as of August 12, 2020 (applies to all claims filed after this date). Punitive Damages and Attorney Fees Under the amendments, the DOL and the courts can, where appropriate, in their discretion, issue an award of punitive damages in favor of an employee who prevails in an employment discrimination proceeding. Previously, New York Courts and the DOL had the discretion to award attorney fees to a prevailing party in employment discrimination proceedings. That discretion has now been removed as the amendments require the courts and the DOL to award attorney fees to a prevailing party in an employment discrimination proceeding. Note, however, in order for the employer to recover attorneys’ fees, the employer must make a separate motion to the court and must establish that the employee’s case was “frivolous”, meaning that it was commenced or continued in “bad faith” without any reasonable basis. Effective date: Already in effect as of October 11, 2019 Liberal Construction NYSHRL is “to be construed liberally for the accomplishment of the remedial purposes thereof, regardless of whether federal civil rights laws, including those laws with provisions worded comparably to the provisions of this article, have been so construed.” Exceptions and exemptions to the law “shall be construed narrowly in order to maximize deterrence of discriminatory conduct.” This language indicates that courts should interpret state harassment and discrimination laws as broadly as possible. The NYSHRL has an express purpose to protect those who have experienced harassment or other forms of discrimination. Effective date: Already in effect as of August 12, 2019 Next Steps Given that 2019 is the second consecutive year in which New York has amended the state’s harassment and discrimination laws, employers can reasonably assume that more changes will come along sooner rather than later. Future legislation will likely build on these amendments as well as GENDA; the act passed earlier this year that addresses discrimination related to gender identity and expression. With that in mind—not to mention the fast-approaching deadlines in 2019—employers should speak with legal counsel and develop proactive strategies as soon as possible. Looking for experienced, flexible guidance in navigating New York’s new laws? At Offit Kurman, we are well-equipped to adapt to the needs of businesses of all sizes. For instance, our firm makes it easy for small employers to pool together and conduct shared annual training on a cost-effective basis. Discover how we can help you and your organization, as well as the members of any association or local community you belong to. Learn more about our New York Labor and Employment Law services.
October 3, 2023
Labor and Employment
New York State Permanent Sick Leave
Originally posted on 07/24/2020, content updated on 09/29/2023 New York State enacted a permanent paid sick leave law on April 3, 2020, which took effect 180 days after the enactment, on September 30, 2020 (the “PSLL”). The PSLL adds Sec. 196-b to the N.Y. Labor Law. Under the PSLL, employees began accruing leave as of September 30, 2020, but employees could not begin to use accrued leave until January 1, 2021. Amount of Leave/Paid vs. Unpaid The amount of leave an employer is required to provide and whether it is paid or unpaid leave, varies based on the size of the employer’s workforce in any calendar year and the amount of net income in the previous tax year: Employers with four or fewer employees and net income of $1 million or less in the previous tax year are required to provide 40 hours of unpaid sick leave per calendar year. Employers with four or fewer employees and net income of greater than $1 million in the previous tax year are required to provide 40 hours of paid sick leave per calendar year. Employers with five to 99 employees must provide 40 hours of paid sick leave per calendar year. Employers with 100 or more employees must provide 56 hours of paid sick leave per calendar year. For the purposes of calculating the number of employees, a “calendar year” is defined as the 12-month period from January 1 through December 31. For the purposes of using and accruing leave, a “calendar year” means either January 1 through December 31 or any regular and consecutive 12-month period. Accrual and Frontloading: Leave must accrue at a rate of at least one hour per 30 hours worked; however, an employer may choose to provide employees with the entire amount of leave at the beginning of the year. An employer who chooses to frontload leave may not later reduce the amount of leave if the employee does not work sufficient hours to accrue the amount provided. Use of Sick Leave Reason for Leave: An employee may use sick leave for any one of the following reasons: mental or physical illness, injury or health condition of an employee or the employee’s family member (regardless of whether a diagnosis has been obtained); diagnosis, care or treatment of a mental or physical illness, injury, or health condition of, or the need for medical diagnosis of, or preventative care for, the employee or employee’s family member; or absence when an employee or employee’s family member has been the victim of domestic violence, a family offense, sexual offense, stalking or human trafficking and seeks or obtains services, including from a shelter, attorney or law enforcement, or takes “any other action to ensure the health or safety of the employee or family member or to protect those who associate or work with the employee.” Covered Family Members: A family member is defined as an employee’s child, spouse, domestic partner, parent, sibling, grandchild or grandparent or the child or parent of an employee’s spouse or domestic partner. “Parent” is defined as “a biological, foster, step- or adoptive parent, or a legal guardian of an employee, or a person who stood in loco parentis when the employee was a minor child.” Additionally, “child” is defined as a biological, adopted or foster child, a legal ward or a child of an employee standing in loco parentis. Proof of Qualifying Reason: An employer may not require the disclosure of confidential information as a condition of providing leave, such as information relating to a mental or physical illness, injury or health condition of the employee or the employee’s family member. Minimum Increment: An employer may set a reasonable minimum increment at which leave must be used; however, this increment may not exceed 4 hours. Compensation: PSLL compensation must be the greater of: (1) the employee’s regular rate of pay, or, (2) the applicable minimum wage established by N.Y. Labor Law Sec. 652. Carry Over: Unused sick leave will be carried over. However, employers with fewer than 100 employees may limit an employee’s use of sick leave to 40 hours per year, and employers with 100 or more employees may limit use to 56 hours per year. No Payout at Separation: Employers are not required to pay employees for unused sick leave upon an employee’s voluntary or involuntary separation from employment, including retirement. Interaction with Other Leave: Employer Policy: An employer that already provides a sick leave or paid time off policy that meets or exceeds the leave provided by this law need not provide additional leave as a result of this law. The employer’s policy must also satisfy the accrual, carryover and use requirements of the law. Local Paid Sick Leave Laws: This law does not prevent a city or municipality with a population of one million or more from enforcing local laws or ordinances which meet or exceed the standards or requirements of this law. The law also provides that any paid leave benefits provided by a municipal corporation existing as of the effective date of the law will remain in effect. New York City and Westchester County have existing sick leave laws. Collective Bargaining Agreements: Employers who enter into collective bargaining agreements on or after the effective date of this law must provide benefits comparable to those provided under the law. These agreements must specifically acknowledge the provisions of the law. Job Protections Retaliation: An employer may not retaliate or discriminate against or otherwise penalize any employee for requesting or using sick leave. Job Protections: An employee must be restored to his or her position with the same pay and terms and conditions of employment upon return from leave. Documentation: An employer is required to track the amount of sick leave provided to each employee and maintain this information in its payroll records for six years. Upon request by an employee, the employer must provide within three business days a summary of the amount of sick leave accrued and used by the requesting employee.
September 29, 2023
