New York State and New York City Pass Landmark Employment Legislation: Will 2016 Be “The Year of the Worker”?

After agreeing last week on a 2016-17 Executive Budget that includes several key labor and employment provisions, New York State Independent Democratic Caucus Leader Jeffrey Klein declared that “[t]his truly is the Year of the Worker.”  The ground breaking bills include an increase of the New York State minimum wage over the next few years to $15 per hour and paid family leave for employees for up to 12 weeks when caring for an infant, family member with a serious health condition or to relieve family pressures when someone is called to active military service.  The New York City Council was also busy on the employment front last week, passing several changes to the New York City Human Rights Law that impact New York City employers.  These recent State and City legislative developments are summarized below.

Minimum Wage Increase

The minimum wage in New York State will increase in annual steps beginning at the end of this year depending on (1) where the employer is located, and (2) how many employees they have.  For employers in New York City with 11 or more employees the minimum wage will increase as follows:

  • to $11.00 per hour on or after December 31, 2016;
  • to $13.00 per hour on or after December 31, 2017;
  • to $15.00 per hour on or after December 31, 2018.

Smaller employers in New York City (those with ten or less employees), will have to pay their employees a higher wage rate, but the minimum wage will increase at a slower rate.  The hourly wage rate will go to $10.50 per hour on December 31, 2016 and will hit the $15 per hour mark on December 31, 2019.

The hourly wage rate will increase at smaller increments for New York employers outside of New York City.  For the non-New York City employers in “downstate” New York, which includes Nassau, Suffolk and Westchester counties, the minimum wage will increase to $10.00 per hour on or after December 31, 2016 and increase an additional one dollar per hour each year until December 31, 2021 when the minimum wage will be $15 per hour.  Finally, for employers in the remaining counties of New York, the minimum wage will increase to $9.70 per hour on or after December 31, 2016, with an additional increase each year until 2020.  After 2020, the minimum wage will continue to increase based upon an indexed scheduled to be set by the Director of the Division of Budget in consultation with the New York State Department of Labor.

Paid Family Leave

Like the minimum wage, the paid family leave provisions will be introduced incrementally beginning in 2018, with the plan fully implemented by 2021.  Once fully-phased in, employees who have been employed for 26 or more consecutive weeks will be eligible for 12 weeks of paid family leave, with the benefits capped at 67 percent of the statewide average weekly wage.  The law will also prohibit retaliation against employees who take paid family leave and will guarantee reinstatement to the same or comparable position after the 12 weeks of leave.

The family leave benefits will be paid for exclusively by employee contributions made through payroll deductions.  Employers are not required to fund any portion of the family leave benefit.  The superintendent of financial services is responsible for setting the maximum employee contribution for this benefit.  Paid leave will operate similar to the existing state-mandated disability insurance for an individual’s own disability, with the employer passing the employee’s family leave benefit contributions to the employer’s insurance provider or to the state fund.  The law permits an employer to offer an employee to use accrued but unused vacation time or other personal time, but the law makes clear that the decision of whether to supplement the statutory benefit with accrued time off is the employee’s to make.

The term “family leave” mirrors the federal Family and Medical Leave Act and will cover care for a family member who has a serious health condition, child care for an infant during the first 12 months after birth or adoption of a child, and qualifying exigency for military families.  In New York, paid leave for an employee’s own illness will continue to be covered through the state’s disability benefits law.

New York becomes one of only 5 states that have paid family leave, joining California, New Jersey, Rhode Island, and Washington.

Changes to the New York City Human Rights Law

In addition to New York State, New York City has also been expanding employee protections through legislation.  On March 28, 2016 alone, the New York City Council passed several amendments to the City Human Rights Law, including:

  • An amendment, which becomes effective on July 26, 2016, to make clear that the New York City Human Rights Law (“NYCHRL”) should be liberally interpreted and that the exceptions and exemptions should be narrowly construed.
  • An amendment to give the New York City Commission on Human Rights, which is responsible for enforcing the NYCHRL, the ability to award attorneys’ fees and costs, including expert fees, upon a finding of discrimination.  This provision is immediately effective.

An amendment to repeal a provision of the NYCHRL that addressed sexual orientation discrimination that was deemed to be antiquated and unnecessary.  Specifically, the now repealed language provided that the NYCHRL should not be construed to (a) restrict an employer’s right to insist than an employee meet bona-fide job qualifications; (b) authorize or require affirmative action on the basis of sexual orientation; (c) limit or override any exemptions from the provisions of the NYCHRL; (d) make lawful any act that violates the New York Penal Law; or (e) “[e]ndorse any particular behavior or way of life.”