Category: Compensation

March 19, 2020

New York State Creates COVID-19 Quarantine Leave for Employees

On March 18, 2020, New York enacted a new law providing job-protected leave and compensation to any employee in New York State who is under a precautionary or mandatory order of quarantine or isolation due to COVID-19. The law provides varying benefits based on several characteristics of the employer.

In addition to the statutory terms discussed below, the law requires various State agencies to issue interpretative regulations by June 1, 2020. The law, however, took effect immediately.

Private (Non-Government) Employers

“Small” Employers

Private employers with less than 10 employees as of January 1, 2020, and income less than $1 million in the previous tax year must provide unpaid sick leave to any employee who is placed under a precautionary or mandatory order of quarantine or isolation due to COVID-19 through the duration of the order. Employers must continue to provide such employees and any other benefit that the employee has a right to under any law.

These employees are entitled to receive compensation for the duration of the leave through the New York paid family leave and disability benefits programs.

“Medium” Employers

A middle category of benefits applies to employees of employers with:

less than 10 employees who had a net income greater than $1 million in the previous tax year; and
between 11 and 99 employees.

These employers must provide at least 5 days of paid leave to employees under COVID-19 quarantine or isolation. They must also allow unpaid leave for the remainder of the quarantine or isolation period.

After the 5 days of paid leave, such employees will be eligible for paid family leave and disability benefits.

“Large” Employers

Employers with one hundred or more employees must provide at least 14 days of paid sick leave to any employee under COVID-19 quarantine or isolation.

The statute does not state that these employees can receive additional unpaid leave or paid family leave and disability benefits. That might be based on the assumption that quarantine usually wouldn’t last beyond 14 days. Or perhaps, the omission could be inadvertent and may be corrected through an amendment upon discovery by the State.

Public Employers

Public employers (i.e., all state and local government entities) must provide any employee or officer under a mandatory or precautionary order of quarantine or isolation with 14 days of paid sick leave.

The statute clarifies that such public employees must receive compensation at their “regular rate of pay” for “regular work hours” they miss due to the quarantine or isolation order. There is no specific clarification of the compensation rate for private-sector employees.

Additional Conditions for Quarantine Leave

Qualifying Quarantine/Isolation Order

To qualify for leave the employee’s order of precautionary or mandatory quarantine or isolation for COVID-19 must be issued by the State of New York, the NYS Department of Health, a local board of health, or any government entity duly authorized to issue such an order.

However, the law clarifies that this law does not apply to an employee who meets both of the following conditions:

has been deemed asymptomatic or has not yet been diagnosed with any medical condition; and
is physically able to work while under a mandatory or precautionary order of quarantine or isolation, whether through remote access or other similar means.

Job Restoration

Employers must restore any employee who returns to work from COVID-19 quarantine leave to the position the employee held before taking the leave. The employee must receive the same pay and other terms and conditions of employment.

The law prohibits discrimination and retaliation against employees for taking this leave.

Conversely, the law does not bar employers from taking personnel actions unrelated to “any request to use, or utilization of, any leave provided by this act.” Presumably, this acknowledges that employers may discipline or even layoff or discharge employees due to performance, misconduct, or economic factors.

Impact on Other Sick Leave

Any employee who qualifies for leave under this law may take it without losing any other accrued sick leave.

Disqualifying Travel

Any employee who (other than for work or at the direction of their employer) traveled to a country subject to a Level 2 or Level 3 travel health notice from the Center for Disease Control and Prevention, despite receiving such notice, is not eligible to receive paid sick leave during the period of quarantine or isolation. Such employees still may use any other accrued paid sick leave and remain entitled to unpaid leave for the duration of the quarantine or isolation.

Employee Eligibility for Insurance Benefits

New York State Disability Benefits

The new law amends, for limited purposes, the definition of “disability” under the New York State Disability Benefits Law to mean:

any inability of an employee to perform the regular duties of his or her employment or the duties of any other employment which his or her employer may offer him or her as a result of a mandatory or precautionary order of quarantine or isolation issued by the state, the department of health, a local board of health, or any government entity duly authorized to issue such order due to COVID-19 and when the employee has exhausted all paid sick leave provided by the employee’s employer” under the COVID-19 quarantine leave law.

For employees with such a disability, the law waives the standard 5-day waiting period before receiving disability benefits. This waiver allows qualifying employees to begin receiving disability benefits starting the first full workday that they miss due to COVID-19 quarantine or isolation.

The law seems to increase substantially the dollar amount of disability benefits potentially available for employees missing work for this purpose. Usually capped at $170 per week, disability benefits for qualifying employees on COVID-19 quarantine leave will be equal to the difference between the maximum family leave benefit and the employee’s average weekly wage, up to a maximum of $2,043.92.

New York State Paid Family Leave

The COVID-19 quarantine leave law also amends, for limited purposes, the definition of “family leave” under the New York State Paid Family Leave Benefits Law to mean:

(a) any leave taken by an employee from work when an employee is subject to a mandatory or precautionary order of quarantine or isolation issued by the state, the department of health, a local board of health, or any government entity duly authorized to issue such order due to COVID-19; or

(b) to provide care for a minor dependent child of the employee who is subject to a mandatory or precautionary order of quarantine or isolation issued by the state, the department of health, a local board of health, or any government entity duly authorized to issue such order due to COVID-19.

Notably, part (a) of this revised definition provides for “family leave” in the case of the employee’s own quarantine or isolation due to COVID-19. This addition is a significant departure from the existing NYS paid family leave provisions, which only apply to particular circumstances unrelated to the employee’s own medical condition.

Simultaneous Benefits

The above all now means that an employee under quarantine or isolation for COVID-19 can receive both disability benefits and paid family leave benefits at the same time.

However, the law caps these benefits for employees under quarantine or isolation at no more than $840.70 in paid family leave benefits and $2,043.92 in disability benefits. An employee’s average weekly wage would have to be at least $2,884.62, or $150,000 annually, to reach the cap.

Ironically, it seems that perhaps employees making less than about $1,400 per week would end up with less than full wage replacement. That is because the law determines the amount of disability benefits based on the “maximum weekly family leave benefit,” which arguably is the maximum for any employee (currently $840.70), rather than the lower amount that the employee in question would receive in paid family leave benefits. It’s uncertain whether the State intended this discrepancy. It is possible that they might seek to “clarify” the calculation by an amendment or further regulatory action.

Interaction with Other Laws

This New York State measure addresses possible overlap with federal law. Indeed, within hours of Governor Cuomo signing this act, President Trump signed a bill from Congress that also provides for up to two weeks of paid sick leave related to COVID-19. The federal law would apply to some of the same employees and employers as the State law, does but there are differences in coverage.

The New York law indicates that its benefits (whether through paid sick leave, paid family leave, or disability benefits) are not available to the extent the employee otherwise receives compensation under the federal law. However, where the State law provides more generous benefits than the federal law, the employee is eligible to receive the difference in benefits to supplement what the federal law requires.

Our full summary of paid sick leave and paid FMLA requirements under the Families First Coronavirus Response Act is available here.

Penalties

The New York law does not contain any express penalties for non-compliance. However, existing penalty provisions under the New York Disability Benefits Law and New York Paid Family Leave Benefits Law would likely apply to relevant portions. Moreover, failure to pay the new sick leave benefits might constitute a failure to pay wages subject to stiff penalties under the New York Labor Law.

What Employers Must Do

Asking employers to comply with this new law, especially when coupled with new federal requirements and during an unprecedented national health crisis, is no small request by the State. The provisions are quite complex, including peculiar implications under existing insurance policies. But the law is now in effect and should be taken seriously. Ideally, this would include updating applicable policies, such as your paid family leave policy, which all New York employers must have in writing. We strongly encourage you to consult with experienced employment attorneys in attempting to apply this new array of leave benefits to your workplace.

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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 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.