On May 30, 2017, New York City Mayor Bill de Blasio signed a package of laws collectively referred to as “Fair Workweek” legislation. The laws will take effect on November 26, 2017. As a group, they place considerable restrictions on retail and fast food chains’ scheduling of employees. Giving the timing, this could be an interesting holiday shopping season in the Big Apple.

Some media reports suggest that New York State make take action to trump these NYC laws in whole or part. At this time, however, there is nothing in place that definitely preempts these local laws.

Who’s Affected by the “Fair Workweek” Laws?

Here are several terms describing who is subject to these local laws:

FAST FOOD

“Chain” means a set of establishments that share a common brand or that are characterized by standardized options for decor, marketing, packaging, products and services.

“Fast food employee” means any person employed or permitted to work at or for a fast food establishment by any employer that is located within New York City where such person’s job duties include at least one of the following: customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning or routine maintenance. The term “fast food employee” does not include any employee who is salaried.

“Fast food employer” means any employer that employs a fast food employee at a fast food establishment.

“Fast food establishment” means any establishment (i) that has as its primary purpose serving food or drink items; (ii) where patrons order or select items and pay before eating and such items may be consumed on the premises, taken out or delivered to the customer’s location; (iii) that offers limited service; (iv) that is part of a chain; and (v) that is one of 30 or more establishments nationally, including (A) an integrated enterprise that owns or operates 30 or more such establishments in the aggregate nationally or (B) an establishment operated pursuant to a franchise where the franchisor and the franchisees of such franchisor own or operate 30 or more such establishments in the aggregate nationally.

RETAIL

“Retail employer” means any employer that employs a retail employee at a retail business.

“Retail business” means any entity with 20 or more employees that is engaged primarily in the sale of consumer goods at one or more stores within the city. For the purposes of this definition, “consumer goods” means products that are primarily for personal, household, or family purposes, including but not limited to appliances, clothing, electronics, groceries, and household items.

“Retail employee” means any employee who is employed by a retail employer.

Fast Food Requirements

Scheduling

Covered employers must provide fast food employees with more advance information about their work schedules. By the first day of work, employers have to give an employee a written work schedule containing regular and on-call shifts. Then, generally, employers must give employees their work schedules at least two weeks in advance. If the employer makes changes with less notice, then it must pay the worker an additional $10 to $75 depending on the amount of notice given.

“Clopening” Shifts

The laws also require that employees have at least 11 hours between shifts. In many cases, this prohibits an employer from having an employee close one day and open the next. This is called “clopening.” However, employees may agree to work such shifts. If an employer requires an employee to work “clopening” shifts without consent, it must pay the employee an additional $100 per instance.

Available Hours

Covered employers must offer available regular and on-call hours to current employees before hiring new employees or subcontractors to perform the work. This does not apply where it would cause the employer to have to pay overtime at time-and-a-half.

Not-for-Profit Contributions

In a unique twist, the laws also require fast food employers, upon employee request, to make deductions from employees’ paychecks and donate the money to a non-profit organization of the employee’s choosing.

Retail Requirements

With respect to retail establishments, a new law bans on-call scheduling in New York City. Specifically, retail employers may not:

• Schedule an employee for an on-call shift.
• Cancel an employee’s shift within 72 hours of its scheduled start time.
• Require an employee to work with less than 72 hours’ notice (without the employee’s consent).
• Require an employee to call in within 72 hours of the start of the scheduled shift to confirm whether the employee must report to work.

There are some exceptions. Employers may change employees’ schedules with less than 72 hours notice if the employer’s operations cannot otherwise begin.

Retail employers must also provide written work schedules 72 hours in advance of the first shift on the schedule.

Additional “Fair Workweek” Requirements

These laws also include prohibitions on retaliation and notice posting and recordkeeping requirements. (Related: see my earlier post on New York State’s wage notice requirements.)

Beyond the additional compensation due to employees in some situations, the New York City Office of Labor Standards may assess remedies including compensatory damages, rescission of employee discipline, and civil penalties up to $1,000 per violation or $15,000 where an employer engages in a pattern or practice of violations.

What Impact Will NYC’s “Fair Workweek” Laws Have?

These laws significantly restrict employee scheduling by covered retail and fast food employers. New York joins Seattle and San Francisco as the only cities in the U.S. to enact legislation of this kind. If it takes affect in New York City, it will at least impose new administrative work for affected companies.

In some sense, the new requirements may create a Catch-22 for employers. On one hand, fast food chains can’t hire new employees without first offering full time hours to all current workers. On the other hand, they can’t schedule employees on short notice without paying additional compensation. So it may be practically impossible (or very costly) to maintain an appropriately sized workforce.

The law permitting employees to contribute to non-profit organizations through payroll deductions also potentially places considerable burden on fast food employers. Companies may have to direct contributions to any number of organizations. This could include labor unions or others with interests that diverge from or conflict with the employer’s business. This appears to be the first law of its kind across the country. Thus, there is no history to draw from in anticipating the full extent of the possible ramifications.

One possibility is that employers might respond to these new “fair workweek” rules by replacing employees with technological solutions. For example, they could increase reliance on touch screen ordering systems in lieu of counter workers. It does not appear that computers have to receive any advance notice of when they will be working!

Finally, there have been rumors that Governor Cuomo, the New York State Department of Labor, and/or other government forces in Albany are working to undermine, curtail, or otherwise preempt in some respects the effectiveness of these New York City laws. It’s not yet clear whether that is actually taking place or what such measures may look like. Therefore, covered employers should begin to prepare for the planned restrictions beginning just after Thanksgiving 2017!

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