New York State Expands Equal Pay Law and Other Workplace Protections for Women

On October 21, 2015, New York State Governor Andrew Cuomo signed a group of eight bills, referred to as the Women’s Equality Agenda, which expand protections for women in the workplace and elsewhere in New York State.  The changes that will affect New York employers include an expansion of the existing State equal pay law, the addition of familial status as a protected category and the express requirement that employers reasonably accommodate pregnancy-related conditions.

The new laws affecting the workplace are as follows:

Amendment of Equal Pay Law

Following the lead of California, which strengthened its own equal pay act earlier this month with enactment of the Fair Pay Act, Governor Cuomo has signed the Achieve Pay Equity bill.  This bill makes several important amendments to the State’s equal pay law (Section 194(1) of the New York Labor Law), which until now, closely tracked the Federal Equal Pay Act (EPA).  Section 194(1), like the EPA, requires employers to provide equal pay to men and women in the “same establishment” for “equal work,” defined as work requiring “equal skill, effort and responsibility” and “performed under similar working conditions.”  However, an employer can defend wage differentials if they are based on: (a) a seniority system, (b) a merit system, (c) a system that measures earnings by quantity or quality of production, or (d) any other factor other than sex.

The new law amends Section 194(1) as follows:

First, the law broadens the meaning of “same establishment” by defining it to include workplaces located in the “same geographic region” (but no larger than a county), taking into account population distribution, economic activity and/or the presence of municipalities.  Thus, the comparison of employee wages may go beyond a single location, for example, two retail stores of a company in the same city or in different cities but in the same county.  It remains to be seen how much flexibility employers will have to apply the stated factors to determine what constitutes the “same geographic region.”

Second, the law replaces the “any other factor other than sex” defense to a wage differential and with the potentially more limited and ambiguous defense of “a bona fide factor other than sex, such as education, training, or experience (emphasis added).”  The law further provides the employer must demonstrate that this factor:

  • is not based on or derived from a sex-based differential in compensation
  • is job-related with respect to the position in question; and
  • is consistent with a business necessity (defined as “a factor that bears a manifest relationship to the employment in question”).

However, even if the employer can satisfy its burden with respect to these three elements, the defense will not be allowed if the employee can then demonstrate that:

  • the employer uses an employment practice that causes a disparate impact on the basis of sex
  • an alternative employment practice exists that would serve the same purpose without causing a disparate impact; and
  • the employer has refused to adopt the alternative practice.

The amended New York law is similar to the California Fair Pay Act in placing a greater burden on employers to justify wage differentials.   However, the California law goes even further by requiring employers to pay employees of the opposite sex equally for “substantially similar work” when viewed as a composite of skill, effort and responsibility, and performed under similar working conditions, rather than for “equal work,” which remains the standard in New York.   The different standards for employers in New York and California will create challenges for employers with operations in both states.   (For an in-depth examination of the California Fair Pay Act, see our prior blog post and article by colleagues, Gary R. Siniscalco and Lauri Damrell.)

The Achieve Pay Equity bill makes two additional revisions affecting pay claims in New York:

Pay Transparency:  The bill provides that employers may not prohibit employees from inquiring about, discussing or disclosing wage information, except under very limited circumstances.  Many New York employees already have similar protections, including those employed by federal contractors, who are subject to Executive Order 13665, and employees covered by Section 7 of the National Labor Relations Act.

Increased Damages:  The bill increases the amount of liquidated damages that may be awarded under the Labor Law for failure to pay wages, including a violation of Section 194, from 100% of the wages due to 300% of wages due, but only in the case of a willful violation.

Family Status Discrimination

The End Family Status Discrimination bill adds familial status to the characteristics and groups of individuals protected from employment discrimination under the New York State Human Rights Law (HRL).  Prior to the amendment, the HRL only protected individuals against discrimination based on familial status in housing and credit.  “Familial status” is defined under the HRL as a person who is pregnant, or has a child, or is in the process of securing legal custody of any individual, under the age of eighteen.  While the new law was intended to protect women who are affected by stereotypes about their ability to work due to their status as a parent or guardian of children, the law applies equally to men and women as parents or guardians.

Accommodation of Pregnant Employees

The Protect Women from Pregnancy Discrimination bill clarifies the Human Rights to expressly require that employers provide reasonable accommodations for pregnancy-related conditions, unless to do so would cause an undue hardship to the employer.

Sexual Harassment Coverage for Small Employers

The Protect Victims of Sexual Harassment bill amends the HRL to protect all employees from sexual harassment in the workplace regardless of employer size by eliminating the current four-employee coverage threshold under the HRL.  However, the expanded coverage applies only to sexual harassment claims and not to other protections of the HRL.

Attorneys’ Fees for Prevailing Plaintiffs

The Remove Barriers to Remedying Discrimination bill amends the HRL to permit a prevailing plaintiff in an employment or credit discrimination case based on sex to recover reasonable attorneys’ fees. The bill also permits a prevailing respondent in such a case to recover its reasonable attorneys’ fees, but only if the respondent can show that the action was frivolous.  The bill does not change the law with respect to other types of employment discrimination claims under the HRL, which precludes any party from recovering attorneys’ fees.

All of the bills become effective on January 19, 2016, 90 days after enactment.