Tag: Governor Cuomo

New York Bereavement Leave

Cuomo Vetoes New York Bereavement Leave Law

In June 2018, the New York State Legislature overwhelmingly approved legislation that would have granted paid bereavement leave rights to most employees. The measure would have changed the New York Paid Family Leave Benefits law to include bereavement leave along with the existing qualifying circumstances.

In light of extensive resistance from the business community, the Legislature did not formally deliver the bill to the Governor’s office until December. Upon receipt, Governor Cuomo vetoed the legislation ostensibly out of concern for the impact on workers.

Proposed Bereavement Leave Amendment

New York bereavement leave legislation passed the Senate by a vote of 61-1 and the Assembly 111-32.

Republican Senator Rich Funke and Democratic Assemblyman Joe Morelle sponsored the amendment. Both have lost children who were in their early thirties. Their memorandums in support of the bill stated:

“The inability to take time to process grief not only has an impact on a person’s health and their family, it has a profound impact on their ability to carry out their normal day to day tasks. However, on average, four days are allotted for the death of a spouse or child, according to the Society for Human Resource Management 2016 Paid Leave in the Workplace Survey.”

The legislation relied on additional wording in the Paid Family Leave Benefits law that took effect at the beginning of 2018. It modified the definition of “family leave” to include “leave taken for the purposes of bereavement due to the death of a family member.” The legislation also indicated that a death certificate would provide the necessary certification of eligibility for leave.

Potential Impact of Proposal

These minimal revisions to the Paid Family Leave legislation could have had extreme consequences.

Bereavement leave apparently would have been available for up to 10 weeks (increasing to 12 weeks in 2021) each year without any limitation on the timing relative to the death. Moreover, it would have been available equally regarding a broad array of family members, including grandchildren, children, spouses, parents, and grandparents. Although the New York Workers’ Compensation Board likely would have been able to issue regulations related to the new bereavement leave component of Paid Family Leave, it might have lacked authority to place further limitations on those parameters.

As the Paid Family Leave Program operates as a (primarily) employee-funded insurance benefit, employees would have had to contribute more out of their paychecks to fund the insurance premiums. As with the original Paid Family Leave categories, this long-term bereavement leave would have been difficult for the State to price effectively, potentially leading to over- (or more likely) under-funding in the first years.

Business Community Opposition

The Business Council of New York led the efforts of more than 20 prominent business groups, including many chambers of commerce, seeking Governor Cuomo’s veto of this legislation.

This consortium’s August 2, 2018 letter to the Governor’s office noted that the Legislature had rebuffed efforts to include more reasonable limits on paid bereavement leave:

“The Business Council’s recommendations for reasonable parameters on any expansion of PFL to bereavement were rejected by both the Senate and Assembly sponsor. These included limiting bereavement leave to several weeks, to be used within 180 days of a family member’s death.”

This letter also expressed concern “that the Legislature is proposing a dramatic expansion of the Paid Family Leave Act that has only been in effect for just over six months [now one year], and before any usable data is available regarding utilization or costs. Employers, the state, insurers and employees are still working to understand and implement the current law.”

Finally, these business groups noted that fully-paid bereavement leave is already a standard employee benefit, though often only for a few days; and that “Employers understand that to attract and retain the best talent available they need to be there for their employee[s] in their time of need and will continue to do so without another burdensome government mandate.”

Governor Cuomo’s Veto

Although business groups more vocally object to this legislation, Governor Cuomo publicly relied almost exclusively on supposed worker concerns in his veto message:

“Workers’ organizations such as A Better Balance have expressed significant concerns to me about this bill, and, as difficult as it is, I must heed their concerns.”

A Better Balance prides itself on having been active in supporting New York’s original Paid Family Leave law. But the organization posted a call to action on its website encouraging the Governor to veto the bereavement leave amendment. It emphasized the anticipated high costs to workers:

“Costs – entirely borne by workers – will be extremely high. Because paid family leave is 100% worker funded, this bill would impose potentially very high, uncalculated costs on New York workers—costs that will fall especially heavily on low-income workers.”

Governor Cuomo repeated that concern, while otherwise sharing some raised more specifically by the Business Council. For example, the veto memorandum notes: “Second, there is no stated limit on when leave can be taken. Unlike bonding leave, which is limited to 12 months from the qualifying event, no such limit would exist here. This drafting failure could lead to claims being made well beyond a year from death.”

The Future of New York Bereavement Leave

Employers should not expect this issue to disappear in 2019. Governor Cuomo concluded his veto message by commenting: “I am committed to working with the Legislature in the coming legislative session to resolve these issues for the benefit of hardworking New Yorkers.”

What might an alternative New York bereavement leave law look like?

New York Legislators will have to decide whether to continue to pursue bereavement leave through the Paid Family Leave Program or another path.

PFL offers the benefit of being an existing, employee-funded system. But any addition of bereavement leave must be much more narrowly drafted than it was in the 2018 legislation. The lawmakers should separately address issues such as length of leave available per death, total leave available per year, timing of leave, etc. And 10 or 12 weeks projects as an unaffordable and overly burdensome duration. The Legislature should also consider whether the same leave parameters should apply equally to small and larger employers.

The Legislature could alternatively seek to impose a mandatory paid or unpaid bereavement leave requirement outside of the Paid Family Leave Program. However, it would then be more difficult to effect an employee-paid system. Requiring employers to offer more than a couple of days of paid bereavement leave would raise significant opposition. And any requirement that small employers pay employees not to work could be financially crippling.

 

To help you keep track of this and other issues of importance to New York employers, we offer a free monthly email newsletter and periodic complimentary webinars. To receive this valuable information at no cost, enter your email address here.

Tip Credits Leaving New York State

Tip Credits Leaving New York?

On December 17, 2017, Governor Andrew Cuomo directed New York’s Commissioner of Labor to schedule public hearings to evaluate the possibility of ending minimum wage tip credits in the State.

Tip credits permit employers to satisfy part of an employee’s minimum wage entitlement through tips earned, rather than cash wages paid by the employer.

Several states (Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington) have long prohibited employers from using tips received by employees as a credit against their state minimum wages.

Cuomo’s Take on Tip Credits

Governor Cuomo’s announcement strongly suggests a belief that New York should eliminate tip credits.

“At the end of day, this is a question of basic fairness. In New York, we believe in a fair day’s pay for a fair day’s work and that all workers deserve to be treated with dignity and respect,” Governor Cuomo said. “There should be no exception to that fairness and decency. I have directed the Department of Labor to ensure that no workers are more susceptible to exploitation because they rely on tips to survive. I look forward to reviewing the findings of these hearings.”

The press release from the Governor’s office offered that more than 70% of all tipped workers in New York are women. It cited a 2014 study by the Restaurant Opportunities Center asserting that “Workers in states that require the full minimum wage be paid to tipped employees experience half the rate of sexual harassment compared to workers in states that pay lower wages to tipped employees.” The Governor’s release also indicated that “studies have shown that African-American workers are often tipped less than their white counterparts.”

New York Hearings on Tip Credits

New York Commissioner of Labor Roberta Reardon has released a schedule of seven “Hearings on Subminimum Wage” throughout the State. The first one will take place March 12, 2018 in Syracuse. The others will be in Buffalo, Long Island, Watertown, Albany, and New York City.

According to the DOL’s website:

Oral presentations may be strictly limited to 3 minutes each. Priority in seating and speaking will be given to those who preregistered. Seating and speaking order for those who do not preregister will be handled on a first-come, first-served basis as determined by event staff. Written testimony must be submitted to: hearing@labor.ny.gov before July 1, 2018.

Click here for the full hearing schedule.

At the Federal Level

Meanwhile, the U.S. Department of Labor is planning to rescind Obama-era restrictions on employers that pay a direct cash wage of at least the full federal minimum wage and do not claim a tip credit against their minimum wage obligations. The agency published a Notice of Proposed Rulemaking on December 5, 2017, seeking to amend the 2011 rule. The already controversial topic has escalated recently upon reports that the U.S. DOL did not make public its economic analysis regarding the proposed changes to the tip pool rules. On February 5, 2018, the Office of Inspector General of the U.S. DOL initiated an audit of this rulemaking process.

The federal rule change would permit back-of-the-house workers to share in the pooled tips of employees who interact directly with customers. Critics oppose the measure in that it might reduce employee compensation by allowing management to personally participate in tip pools.

At least within the hospitality industry (restaurants and hotels), New York has its own rules regarding tip pooling. In most cases, those requirements would likely make the proposed change to the federal rules irrelevant in New York. Most employers must abide both the state and federal regulations. And it does not appear that the New York tip pooling rules are under reconsideration at this time.

Potential Impact on New York Employers

New York employers who currently rely on tip credits to satisfy a portion of the State’s minimum wage should anticipate paying a higher percentage (perhaps 100%) of the minimum wage in cash by the end of 2018. The State might impose separate rules for those in the hospitality industry and others where employees regularly receive tips.

Losing tip credits may force employers to adjust their prices or other components of their business models. For example, some employers have announced express “no tipping” policies. This allows them to increase what they charge customers without increasing the customers’ overall cost. Employers can then use the additional revenues to pay the minimum wages.

Click here for more information on the current New York minimum wages for both tipped and non-tipped employees.

Cuomo Proposal on Workplace Sexual Harassment

First Look: Governor Cuomo’s Proposal to Combat Workplace Sexual Harassment

On January 2, 2018, New York Governor Andrew Cuomo announced his plan to “Combat Sexual Harassment in the Workplace”. Cuomo’s agenda includes a multi-faceted approach that would affect both governmental and private employers. It includes at least five measures to address workplace sexual harassment in New York.

Introducing these initiatives, Governor Cuomo stated:

“2017 brought a long overdue reckoning where the secret and pervasive poison of workplace sexual harassment was exposed by brave women and men who said this ends now. Our challenge in government is to turn society’s revulsion into reform, and we in New York must seize the moment and lead the way. There must be zero tolerance for sexual harassment in any workplace, and we can and will end the secrecy and coercive practices that have enabled harassment for far too long.”

Though there are already pending bills that pursue similar objectives, the Governor has only laid out his specific agenda relatively generically. So let’s just take a preliminary look at how he seeks to change New York employment law.

Note: In this post I raise questions and suggest some downsides to these proposals. That certainly does not mean that I’m opposed to combating workplace sexual harassment. The employers I work with would welcome more effective means of preventing sexual harassment. But this is a very difficult area to legislate, with the potential for many undesirable consequences. So, I think it’s valuable to give them some thought and critical analysis.

Prevents Use of Taxpayer Dollars to Fund Individual Sexual Harassment Settlements

It’s not yet clear how far this proposal intends to go. Would it be limited to harassment claims against elected State officials? Or would it extend to all claims based on the actions of governmental employees at every level of government in New York?

The latter approach could be particularly game-changing. Employees claiming employment discrimination in the form of sexual harassment usually name their employer directly. In fact, under Title VII (the federal law that prohibits workplace sexual harassment), individual employees can’t be held liable. Even though the New York Human Rights Law permits individual liability in some situations, employees almost always include the employing entity itself in lawsuits.

What happens if an individual doesn’t have enough money to settle a sexual harassment claim? Does the governmental employer still have to defend the claim, perhaps without the ability to settle? Can a governmental entity still be liable and responsible for paying damages to an aggrieved employee?

There are many complicated aspects to what seems like a straightforward policy matter. Is it feasible to implement this approach? We’ll see.

Proposes Uniform Code of Sexual Harassment for All Branches of State and Local Government

Presumably, this would essentially write a new sexual harassment policy, with consistent complaint procedures, for all governmental employers in New York.

Notably, this proposal includes an “anonymous whistleblower process to help individuals communicate complaints across state and local government without fear of retribution or consequence.”

One can reasonably question how effectively employers can respond to anonymous sexual harassment reports. Even assuming the report names the alleged perpetrator, a good investigation usually begins with speaking with the victim of harassment. If the employer doesn’t know who that is, then they may have little to go on other than asking the named employee whether they have sexually harassed anyone. That may not yield tremendous results.

Hopefully any such initiative would recognize the value of victim involvement in the investigation of sexual harassment. Emphasizing existing anti-retaliation laws, for example, should be a valuable component.

Prohibits Confidentiality Agreements Relating to Sexual Assault or Harassment for All Branches of Government — State and Local — Unless Express Preference of the Victim

This addresses the concern that employees often agree not to discuss their claims in exchange for a financial settlement. Reasonably, the risk is that the perpetrator may commit further harassment because the previous victim could not warn everyone else.

From my experience, in most employment discrimination cases the employer is less concerned about the employee telling others what actually happened to them. They are more concerned about the employee telling others that they received money to go away. This is a valid fear where the employer credibly doesn’t think it did anything wrong, but doesn’t want to spend years litigating the employee’s claim. . . . And also doesn’t want every other unhappy employee, or more often former employee, to come seeking the same payout.

So, one potential downside to this rule would be a greater reluctance to settle cases. Without the confidentiality agreement, the defendants may perceive even greater value in litigating cases out to a decision by judge or jury. If everyone will know about the allegations (and assuming the defendant reasonably believes they did nothing wrong), then the defendant may be better off proving their innocence.

The proposal does purport to permit confidentiality agreements upon the “express preference of the victim”. One might question how to make that a workable standard. What’s the difference between an employee agreeing to confidentiality (as they must usually do now) and demonstrating an “express preference” for it? Will this just mean that the defendant can agree to observe confidentiality, but not the complaining employee?

Mandates Private Companies That Do Business with the State Report Sexual Assault and Harassment Statistics to Prevent Secrecy

We don’t yet know the scope of which companies would be covered or what exactly they must report.

Happily, the majority of companies that do business with the State probably won’t have any incidents to report. But some will. How many will depend on how those terms are defined, etc.

How will the State use this data? Will it cancel the contracts? Pursue litigation? Issue press releases?

Again, the details will matter.

Voids Forced Arbitration Policies or Clauses in Employee Contracts that Prevent Sexual Harassment Cases from Consideration in Law Enforcement Investigation and Trials

Frankly, it’s already unlikely that any arbitration policy or clause in employee contracts would prevent “law enforcement investigation” of sexual harassment cases . . . . Even to the extent that includes investigation by the New York State Division of Human Rights or the federal Equal Employment Opportunity Commission. The National Employment Law Project, a prominent employee-rights group, through its Senior Counsel Patricia Smith (former New York Commissioner of Labor under Governors Eliot Spitzer and David Paterson and U.S. Solicitor of Labor under President Obama), has also acknowledged this, along with expressing some doubts about other aspects of the proposal.

Thus, the primary effect of this piece of the legislation (if enforceable despite potential federal preemption arguments) would be to preserve employees’ default rights to go to court with a claim of workplace sexual harassment. It at least seems fairly straightforward, with few unintended consequences to victims of sexual harassment. Most likely, employees could still readily agree to arbitrate sexual harassment cases if they want to and employers are interested.

What New York Employers Should Already Be Doing to Combat Workplace Sexual Harassment

Again, my scrutiny of the Governor’s announced agenda only means to acknowledge the difficulty of addressing this serious issue. With or without new State legislation, all New York employers should be proactive in avoiding sexual harassment.

Keep in mind: the New York State Human Rights Law prohibits workplace sexual harassment for all New York employees. Other aspects of the State employment discrimination law only apply to employers with at least 4 employees. But the sexual harassment provisions apply to every employer.

For now, here are some basic elements every employer should implement to combat workplace sexual harassment:

 

I will continue to monitor these proposals and the related legislation. To make sure you don’t miss any important updates, sign up for my email newsletter!