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New York Whistleblower Laws

New York Whistleblower Laws

New York is an at-will employment state, which theoretically means employers can terminate employees for any reason at any time. However, there are statutory exceptions. These include whistleblower laws intended to encourage employees to report wrongdoing and protect whistleblowers from retaliation.

What Is a Whistleblower?

The origins of the term “whistleblower” date back to the 19th century. The word is based on the use of a whistle to alert a crowd about a dangerous situation or illegal action. The phrase eventually became associated with police because they often used a whistle to alert the public or fellow police officers.

New York has several statutes that provide whistleblower protections. The most widely applicable is New York Labor Law section 740. Under this law, a whistleblower is an employee who “discloses, or threatens to disclose to a supervisor or to a public body an activity, policy or practice of the employer that is in violation of law, rule or regulation which violation creates and presents a substantial and specific danger to the public health or safety, or which constitutes health care fraud.”

Employees who testify concerning potential misconduct or refuse to participate in illegal activity would also receive whistleblower protection.

Internal Reporting

The majority of whistleblowers report internally to their employer. These whistleblowers report to fellow employees, superiors, or anonymous reporting mechanisms, such as hotlines. These hotlines may help foster a positive workplace culture where employees are more likely to report potential misconduct because they do not fear retaliation.

External Reporting

On the other hand, external whistleblowers report misconduct to entities outside the workplace. These entities include lawyers, the media, police departments, watchdog agencies, or government agencies. Occasionally, these external whistleblowers are motivated by a monetary reward.

Healthcare Whistleblowing

New York Labor Law section 741 provides special rules concerning the healthcare industry. The law is most concerned with “improper quality of patient care” and is intended to encourage the reporting of these types of situations.

The law defines “improper quality of patient care” as “any practice, procedure, action or failure to act of an employer which violates any law, rule, regulation or declaratory ruling adopted pursuant to law, where such violation relates to matters which may present a substantial and specific danger to public health or safety or a significant threat to the health of a specific patient.”

Government Employees

New York Civil Service Law section 75-b provides additional whistleblower protections for employees of state and local governmental entities.

Under this law:

“A public employer shall not dismiss or take other disciplinary or other adverse personnel action against a public employee regarding the employee’s employment because the employee discloses to a governmental body information: (i) regarding a violation of a law, rule or regulation which violation creates and presents a substantial and specific danger to the public health or safety; or (ii) which the employee reasonably believes to be true and reasonably believes constitutes an improper governmental action.”

In some scenarios, public employees may also have Constitutional free speech protections regarding whistleblowing.

What Constitutes Retaliation?

Employers cannot retaliate against whistleblowers for reporting misconduct. Retaliation occurs when an employer takes an adverse employment action against a whistleblower in response to their whistleblowing. Examples of adverse employment actions include firing, giving undesirable assignments, and harassment.

You can read more about preventing retaliation generally here.

Consequences of Retaliation Against Whistleblowers

Employees who have been unlawfully retaliated against may bring a civil action against their former employer. If the court finds in favor of the employee, it may order relief including:

  • Injunctions to stop further violations;
  • Reinstatement to the employee’s former position or an equivalent position;
  • Reinstatement of full fringe benefits and seniority status;
  • Compensation for lost wages and benefits; and
  • Employer payment of reasonable costs, disbursements, and the employee’s attorney fees.

The exact remedies will depend on the specific legal claims and whistleblower laws at issue in a particular case.

What Can Employers Do?

Obviously, the best approach would be to avoid legal infractions or other activity that would cause employees to consider blowing the whistle. But, even then, some employees might still believe that inappropriate conduct is occurring within their workplace.

It is generally illegal for employers to require their employees to report potential misconduct internally before informing outside agencies. However, employers can encourage this approach by encouraging internal reporting, providing anonymous mechanisms, and promising to protect whistleblower confidentiality.

More heavily regulated businesses may be at greater risk of facing allegations from whistleblowers. In addition to the general New York laws discussed here, some industry-specific laws and regulations at both the state and federal level include whistleblower protections.

It is always important to confer promptly with an experienced attorney to determine the exact legal parameters and appropriate responses when facing a whistleblower situation.

Love Contracts

Love Contracts Under #MeToo

Does your human resources department deal with love contracts? If you think this is a crazy question, then you probably haven’t gone down this road before. But these are real legal documents that some companies use when co-workers become involved in romantic relationships. Love contracts (or office relationship contracts) have never been overly commonplace. And the #MeToo movement and the related heightened attention on workplace sexual harassment issues, perhaps ironically, may be revealing even more reason not to use them.

What Are Love Contracts?

You might sooner think of a prenuptial agreement than the type of contract we’re talking about here. But these love contracts are designed primarily to protect employers, not the people who are, well, in love! However, the couple might receive some benefit as well–the ability to continue their relationship without forfeiting their jobs.

There is no straightforward legal definition of a “love contract.” But they usually address these items (perhaps among others):

  • Acknowledgment of a consensual romantic relationship
  • Reiteration of the company’s equal opportunity and anti-harassment policies
  • Guidelines for appropriate workplace behavior
  • Identification of the reporting relationship (if any) between the employees and any potential conflicts of interest
  • Any change in work circumstances necessary to enable the relationship to continue without impairing work performance
  • Recognition that romantic relationships don’t always work out
  • Agreement that the romantic relationship (or its dissolution) does not constitute a violation of company harassment policies

The terms of one of these contracts are usually not negotiable. The company provides the document to the employees. If they choose to sign, then they continue employment and, as they desire, their personal relationship. If either employee refuses to sign, then the company takes alternative action. This could include either re-assigning or possibly terminating one or both of the employees.

Do Love Contracts Work?

One could ask this question from many different perspectives. However, the answer would always be about the same: Maybe, in some respects, but there are no guarantees.

1. Do they encourage employees to disclose workplace romances?

Sometimes, but not always. Dating and sex are topics that most employees don’t want to talk about with HR in the first place. The prospect of possibly being asked to sign a love contract probably further diminishes the incentive to report.

Then you add in the fact that some meaningful percentage of extra-workplace relationships between co-workers are extramarital affairs. Hardly anyone will want to disclose those to their employer, much less put it in writing!

2. Do they ensure that relationships don’t cause trouble at work?

Casual dating among co-workers doesn’t have to be a big problem, and probably isn’t in many cases. The same can be true of more established relationships. But, in either situation, there’s always the reasonable possibility that at least one person will end up upset.

Keep in mind too that relationships don’t always affect just two people. Third parties can also become involved. What of the other employee who is attracted to one of the employees in a workplace relationship? People who were formally involved with one of them? Current or former spouses? For the most part, these “outsiders” won’t be part of a love contract, but could still take offense or otherwise become disgruntled about the relationships or how it carries over into the workplace.

3. Do they prevent sexual harassment claims?

Present data on that question would be hard. But love contracts likely have prevented sexual harassment claims here and there. In different instances, either because they helped employees behave appropriately regarding their relationship or simply discouraged one of the employees from making a claim in light of the existing agreement.

One could also guess that love contracts have, at times, prompted sexual harassment (or sex discrimination) claims. If nothing else, raising the legal significance of the relationship by requiring a contract could make some employees more likely to seek formal recourse when the love dies.

Legally, it is unlikely that the existence of a love contract would automatically “defeat” an employee’s sexual harassment claim. Employees can’t prospectively waive these claims as a formal matter. However, the acknowledgment of the consensual relationship could help the employer overcome some allegations (i.e., that the relationship wasn’t consensual).

As suggested above, love contracts are especially unlikely to prevent or disprove harassment or discrimination claims by employees outside of the relationship. If a co-worker claims he was passed over for a promotion that went to one of the love contract signees because that person was in a relationship with a decisionmaker (the other love contract signee), then the love contract would probably be irrelevant as to that claim.

How Does #MeToo Enter the Equation?

From a societal standpoint, it probably shouldn’t. Workplace sexual harassment has always been inappropriate, and it has been illegal for many years.

At the same time, most companies that have asked employees to sign love contracts probably had good intentions. They weren’t prioritizing hiding sexual harassment. They were trying to make sure that nothing unwelcome was occurring in the first place. HR wouldn’t (in all but the worst run organizations) put undue pressure on an employee to sign an agreement saying they were having a consensual sexual relationship if the employee didn’t believe at the time that it was consensual. If the employee instead said they felt subject to harassment, good companies would have promptly investigated the claim and taken appropriate corrective action.

The positive impact of love contracts on employees has been that they were able to continue to pursue their hearts and their careers (potentially) without interruption. Without love contracts, employers might have (lawfully) forced the employees to choose between their relationship or their jobs.

Now, of course, sexual harassment is at the forefront of media and business attention. That’s good in the sense of hopefully reducing the incidence of harassment. But it does risk increased litigation, which imposes costs on employers.

All told, anyone faced with a workplace romantic relationship these days should be on high alert. Again, no one (whose opinion matters) wants sexual harassment to occur. We don’t want employees to be disadvantaged because they didn’t accept romantic or sexual advances or because co-workers did. At the same time, few employees want to go to HR and put this target on their backs. And, frankly, probably fewer and fewer human resources department or managers want to hear about these relationships because of how complex the implications can be. Sure, they’ll try to do the right thing as problems arise, but that’s different than proactively asking people to sign legal documents related to their romantic, probably sexual, activities.

What’s the Alternative to Love Contracts?

Let’s leave open the possibility love contracts might still work well in some situations. Use them thoughtfully, on a case-by-case basis, though consistent with company policies. Get legal advice and don’t assume they’ll solve all your problems.

As an alternative, many companies have anti-fraternization policies. The limits of these policies vary. Some prohibit any dating or romantic relationships between employees. Others only restrict relationships between employees in the same departments or within the same reporting structure.

Unfortunately, these fraternization or dating policies share many of the same side-effects as love contracts. Principal among them is that they encourage employees to hide their relationships at work. On the one hand, this could be good to the extent that it prevents the relationship from directly affecting the workplace. On the other hand, it can create animosity among employees who do find out about relationships.

Again, it’s not fair to universally condemn or endorse anti-fraternization policies. What works in one workplace might not work in another. But there is one policy that is paramount for all organizations: the anti-harassment policy.

All employers should have written anti-harassment policies covering sexual harassment and all other categories protected by applicable laws (which may vary from state to state). Whatever preventative measures might be in place, employers must take all allegations of sexual harassment seriously, investigate promptly, and take appropriate action.


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Charter Schools NLRB Jurisdiction

Will the NLRB Expel Charter Schools?

On February 4, 2019, the National Labor Relations Board (NLRB) set the stage to review whether it should exercise jurisdiction over charter schools. In two 2016 cases, the NLRB agreed to cover charter schools that are not political subdivisions–i.e., that are not traditional public school districts. At that time, the Board consisted of a majority of Democratic members who favored expanding protections for unions and employees. The NLRB now has a Republican majority.

[For more general information, read: NLRB Jurisdiction: Are We Covered?]

What’s the Issue?

The NLRB has the authority to enforce the National Labor Relations Act (NLRA). This law applies to private, but not governmental employers. Some states have their own similar laws and agencies related to labor relations rights and unionization among public employers. Charter schools have raised questions of the boundaries between these separate legal regimes.

Charter schools are still a relatively new concept. The first ones opened less than 30 years ago. Their exact organization and structure vary based both on applicable state laws and the way the school themselves choose to operate. As their name suggests, these schools typically operate under a “charter” and receive state educational funding. Parents usually have greater freedom in choosing among charter schools, whereas public school “selection” depends primarily on where the students live.

“Political subdivisions” are exempt from coverage under the NLRA. Thus, whether charter schools are “public subdivisions” determines whether the NLRB has jurisdiction over their union-related disputes.

2016 Charter School Decisions

On August 24, 2016, the NLRB issued two decisions finding charter schools to be private corporations serving as government contractors. In other words, they were not political subdivisions. The cases involved Hyde Leadership Charter School in Brooklyn, New York, and Pennsylvania Virtual Charter School, a home-based school headquartered in King of Prussia, Pennsylvania.

Before these cases reached the Board itself, two Regional Directors of the NLRB had respectively applied a 1971 legal standard and found that the schools were not political subdivisions. The Board agreed in separate split decisions featuring dissenting opinions by the lone Republican member at the time.

Of note, among many other considerations, New York law states that charter schools are “within the public school system”. But the 2016 NLRB did not accept the state’s description as deciding federal law.

Hawkins County Test

In the 1971 Supreme Court case of NLRB v. National Gas Utility District of Hawkins County, 402 U.S. 600, the NLRB relied on a two-part test to determine whether an employer is a political subdivision excluded from NLRA coverage. The Board maintained that an entity was a political subdivision if it is “either (1) created directly by the state, so as to constitute departments or administrative arms of the government, or (2) administered by individuals who are responsible to public officials or to the general electorate.” In Hawkins County, the Supreme Court rejected the NLRB’s conclusion that the utility company in question was not a political subdivision. In other words, the Court held, the Board did not have jurisdiction. The Court observed that the employer was a political subdivision under the second prong of the NLRB’s test, among other factors.

To be clear, Hawkins County did not involve a charter school. Minnesota created the first U.S. charter school law 20 years later in 1991. The Supreme Court has not yet weighed in on the question of NLRA jurisdiction of these “new” educational institutions.

Kipp Academy Charter School

A pending NLRB case involves Kipp Academy Charter School in Bronx, New York. A union currently represents the school’s teachers among other categories of employees. In January 2017, two teachers filed a petition with the NLRB seeking to decertify the union. The union argued the NLRB did not have jurisdiction. Following the Hyde Park and Pennsylvania Virtual charter school cases, the NLRB Regional Director exercised jurisdiction and directed the election.

Board Agrees to Review

On appeal, NLRB Chairman John Ring and fellow Republic Members Marvin Kaplan and William Emanuel voted to review whether the NLRB should exercise jurisdiction over charter schools. In doing so, they issued a public request for legal briefs from any interested parties.

Notably, the Republican majority acknowledged that the Regional Director had correctly applied the two-part Hawkins County test. Nonetheless, they want to reconsider whether, as a policy matter, the Board should exercise their jurisdiction, which is discretionary. They might, for example, share the view that former NLRB Chairman Philip Miscimarra noted in his 2016 dissents:

“Based on the approach embraced by my colleagues today, employees concerned about their working conditions will not know what set of rules apply to them or to whom to turn if the employer infringes on their rights, and employees are likely to face years of delay if they try to secure relief from the NLRB. Unions and employers will have difficulty understanding their respective rights and obligations, given the uncertainty about whether federal, state, or local laws apply. Most poorly served will be the students whose education is the primary focus of every charter school. In most instances, the likely result will be protracted disputes that are not definitively resolved until many or most students (and many teachers and other employees) have come and gone.”

…But Not Everyone Is on Board

The lone Democrat currently on the NLRB, Lauren McFerran, participated in the majority decisions to exercise jurisdiction over Hyde Park and Pennsylvania Virtual Charter Schools. Therefore, it is no surprise that she disagreed with the decision to review the Regional Director’s decision regarding Kipp Academy.

Member McFerran contends:

“There are not new policy justifications or legal grounds to revisit the Board’s approach to analyzing jurisdictional questions involving charter schools. Indeed, the majority identifies no specific reasons at all for granting review here. Certainly, a change in the composition of the Board is not a reason for revisiting precedent, as the Board itself has made clear.”

Invitation to File Briefs

The public has until March 6, 2019, to submit briefs arguing their views on the exercise of NLRB jurisdiction over charter schools. Submissions may not exceed 25 pages in length. They must be filed electronically through the NLRB’s website, and copies must be sent to all case participants.

How Will This Affect Charter Schools?

The Board majority emphasizes that they “have made no judgments about the ultimate merits but choose to review the briefs before arriving at any conclusions”. However, it is fair to guess that they might at least be leaning toward declining jurisdiction. That outcome, however, won’t affect all charter schools equally.

In some states, like New York, charter school employees and unions already have strong alternative legal protections under state law. If the NLRB does not exercise jurisdiction, state agencies still might (and, generally, probably would) step in and do so. In other states, however, no NLRB jurisdiction would effectively eliminate the right to unionize for charter school employees.

And even where alternative state laws apply, the specific rights and procedures available might differ in relevant ways. This reality could be motivating parties in the Kipp Academy case itself.

Individual charter schools curious about the potential impact on them should consult directly with experienced labor counsel.


For more on the NLRB’s jurisdiction over employers generally, click here.