Author: Scott Horton

Scott has been practicing Labor & Employment law in New York for almost 20 years. He has represented over 400 employers and authored 100s of articles and presentations and wrote the book New York Management Law: The Practical Guide to Employment Law for Business Owners and Managers. Nothing on this blog can be considered legal advice. If you want legal advice, you need to retain an attorney.

July 30, 2019

New York Equal Pay Act Expands Dramatically

On July 10, 2019, Governor Andrew Cuomo signed legislation extending New York’s Equal Pay Act. Before, the law only prohibited pay disparity between men and women. Now it will apply to a broad array of personal characteristics, including age, race, sexual orientation, and others. In addition, the standard for proving pay discrimination will be lower. Overall, this will result in more successful pay disparity claims if employers do not review and adjust their compensation practices.

The amendments will take effect on October 8, 2019. The New York Equal Pay Act does not apply to government entities.

This legislation accompanied a new law prohibiting employers from inquiring about applicants’ current or past compensation. Those restrictions cover all New York employers, including the government.

Find out more: New York Imposes Salary History Ban

Current New York Equal Pay Act

Since 1966, New York has expressly prohibited pay discrimination between men and women. The protection applied only for “equal work” requiring “equal skill, effort and responsibility” under “similar working conditions.”

Exceptions could apply for pay differences because of a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or a “bona fide factor other than sex.” Such bona fide factors include education, training, or experience.

Until now, the New York Equal Pay Act closely followed a similar federal law.

Inclusion of Additional Protected Characteristics

The first significant expansion of the New York equal pay law is the addition of many more protected characteristics beyond sex.

The law now applies to all of these categories:

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

The New York Human Rights Law already separately prohibits employers from discriminating based on these characteristics. Those provisions would likely cover claims of pay discrimination. However, the Equal Pay Act affords employees additional penalties and procedural protections.

Lower Bar for Equal Pay Violations

Employees will no longer need to prove that they were performing equal work as the comparison employee receiving higher compensation.

The equal pay law will now apply even in cases of “substantially similar work.” This will depend on “a composite of skill, effort, and responsibility.”

The “substantially similar” standard will make it easier for employees to prove a violation. Thus, it requires employers to review their pay practices to ensure ongoing compliance. This may prove to be a challenge since there is no specific guidance on what types of work are “substantially similar.”

Exceptions still apply for seniority, merit, and production compensation systems, as well as bona fide business distinctions. However, such systems may not yield a disparate negative impact on any protected category of employees if an alternative system without the same disparity exists.

Severe Penalties

In 2016, New York amended the equal pay law to allow employees to recover up to 4 times the pay differential. Claims can go back up to 6 years. Class action lawsuits are possible. Successful plaintiffs also recover their attorneys’ fees.

All of this could mean considerable liability for employers who lose cases under the New York Equal Pay Act.

What Should Employers Do?

These amendments to the New York Equal Pay Act give employers a lot to think about. You should seriously consider a review of your company’s compensation systems before the law takes effect in October.

Even employers who feel confident that they are not discriminating are at risk. The considerable expansion of protected characteristics and the lower “substantially similar” threshold allow many more employees to attempt an equal pay claim. These cases will require complex analyses of many factors, such as education level, work experience, and job duties. This will be costly for employers in itself. Plus the financial impact of losing the case could be devastating.

Employers might go a long way in preventing or creating a strong defense to such claims just by conducting a compensation review with the new equal pay requirements in mind. Plus you might discover some discrepancies that warrant pay adjustments.

For more information on these and related legal developments, watch our recorded webinar on recent New York Employment Discrimination Amendments.

July 19, 2019

NY Employment Discrimination Amendments (Webinar Recap)

On July 16, 2019, I presented a complimentary webinar called “New York Employment Discrimination Amendments”. For those who couldn’t attend the live webinar, I’m happy to make it available for you to watch at your convenience.

In the webinar, I discuss:

Expanded Coverage
Relaxed Standards of Proof
Additional Penalties
New Policy/Training Requirements
Prohibition of Confidentiality Provisions
Salary History Ban
and More!

The New York Legislature recently passed sweeping revisions to the New York State Human Rights Law. Once fully enacted by Governor Cuomo, these amendments will significantly expand the coverage of the state’s employment discrimination laws. They will both make it easier for workers to prevail in claims against employers and add new remedies. These changes will collectively increase the cost of claims for employers.

Don’t have time to watch the whole webinar right now? Click here to download the slides from the webinar.

Why You Should Watch “NY Employment Discrimination Amendments”

The New York Human Rights Law currently applies to employers with 4 or more employees (and all employers with respect to sexual harassment). Under the new amendments, this coverage will expand to all New York employers of any size. It will also extend protection from workplace harassment to non-employees, such as independent contractors and vendors.

Not only will more employers and workers be subject to the laws, but the likelihood of liability under the laws will also increase. Where before employees had to prove “severe or pervasive” conduct to win a harassment claim, now they will just have to demonstrate that the unwelcome conduct related to a protected category and was more than a “petty slight or trivial inconvenience.”

In this webinar, we also discuss changes to the New York sexual harassment policy and training requirements. Plus employers will now be prohibited from asking job candidates about their salary or wage history. And pay equity laws are also expanding in material ways to increase liability against employers.

This webinar will get you up to speed on these developments so that your business can stay ahead of the curve in preventing harassment and discrimination claims.

Don’t Miss My Future Webinars!

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July 15, 2019

New York Imposes Salary History Ban

On July 10, 2019, New York Governor Andrew Cuomo signed legislation imposing a broad salary history ban on employers statewide. Under this new law, New York employers cannot rely on a job applicant’s prior compensation in setting their pay. In fact, employers cannot even ask about applicants’ prior wages or salaries. There is a slight exception for situations where the applicant relies on their past compensation to negotiate a higher pay rate.

The law also applies to instances of promotion of current employees.

The terms of the New York salary history ban are in a new section 194-a of the state’s Labor Law. These restrictions will take effect in six months, on January 6, 2020.

Prohibited Salary History Inquiries

Under the new law, New York employers may not, either orally or in writing, “seek, request, or require the wage or salary history from an applicant or current employee as a condition”:

to be interviewed,
of continuing to be considered for an offer of employment, or
of employment or promotion.

In fact, employers seemingly cannot seek the salary history of any applicant or current employee from anyone (i.e., the applicant/employee, their employer, or an agent of the employee) for nearly any purpose.

Exceptions

The law does provide two express exceptions to the general salary history ban.

Confirmation in Negotiations

First, employers may confirm wage or salary history “only if at the time an offer of employment with compensation is made, the applicant or current employee responds to the offer by providing prior wage or salary information to support a wage or salary higher than offered by the employer.”

Compliance with Other Laws

The New York salary history ban legislation allows that it does not override any pre-existing federal, state, or local law that “requires the disclosure or verification of salary history information to determine an employee’s compensation.” Such laws are not prevalent anyway, however.

Use of Salary History Information

Beyond restrictions on obtaining compensation information, the law restricts employers’ use of it if somehow obtained.

The law is clear that applicants or employees may voluntarily provide information about their current or past compensation. But, except in negotiations with employees over possibly increasing salary or wages, employers can’t use the information.

Applicants

The salary history ban broadly prohibits employers from relying on the wage or salary history of an applicant both in determining whether to make a job offer and in setting their wages or salary.

Current Employees

For current employees, the employer obviously knows their current salary. However, the law specifically prohibits employers from refusing to interview, hire, promote, or otherwise employ or retaliate against current employees (as well as job applicants) based on prior wage or salary history.

Employers also may not refuse to interview, hire, promote, or employ anyone for refusing to provide salary history information.

Consequences of Violating Salary History Ban Law

Applicants or employees can sue employers to recover any damages resulting from a violation of the New York salary history ban. Damages would likely include lost wages, which could be substantial, especially where the employer improperly refused to hire the person altogether.

Successful plaintiffs can also recover their attorneys’ fees.

Public Awareness Outreach Campaign

Interestingly, the law concludes with a requirement that the New York Department of Labor must conduct a “public awareness outreach campaign” about the new salary history ban. This must include placing information on the DOL’s website and other efforts to inform employers about the new law.

What Should New York Employers Do Now?

Notably, this is only one of a series of recent legal amendments that will impose new restrictions on New York employers. Companion legislation will also increase liability for pay disparity discrimination.

Fortunately, employers have some time to prepare for the new laws. You should seriously consider no longer asking about current/past pay in hiring now. That will not only help prepare your business for 2020. It might also help reduce the risk of litigation under the new pay equity rules. They take effect in October 2019.

Together, the new laws push employers to pay all employees based on the nature of the job more than on what a particular employee would be willing to receive. This will require some degree of a mindset shift regarding compensation in many workplaces.

The times are changing! Make sure you don’t miss our other updates on New York employment law.