New York State has begun its slow and deliberate process of re-opening on May 15, 2020. Governor Cuomo has established both a regional and industry approach for how the state will re-emerge following the state-wide Executive Order restricting all non-essential businesses since March. The process will be gradual, however, with restrictions on non-essential business in much of the state, including New York City and the surrounding suburbs, potentially continuing through May 28, 2020. READ MORE
The New York State Department of Labor (“NYSDOL”) has issued guidance (the “Guidance”) and answers to frequently asked questions (“FAQs”) relating to various aspects of the newly-enacted legislation providing emergency sick leave, expanded New York Paid Family Leave (“NYPFL”) and expanded short-term disability benefits to certain employees unable to work because of COVID-19. Our previous analysis of this legislation (the “Act”) and what it means for employers can be found here: https://blogs.orrick.com/employment/2020/03/. READ MORE
New York State enacted the “Women on Corporate Boards Study” on December 30, 2019, with the goal of improving diversity on corporate boards. Effective June 27, 2020, the law requires the New York Department of State and Department of Taxation and Finance to conduct a study on the number of women who serve on boards of directors of companies doing business in New York State. To facilitate the study, the law requires foreign and domestic corporations to report to the Secretary of State the number of directors on their boards and to specify how many of those directors are women as part of the corporation’s filing statement.
The study will analyze the number of women directors and the total number of directors that constitute the board of each corporation, the change in the number of women directors from previous years, and the aggregate percentage of women directors on all boards in New York. The law also provides that the Department of State will publish a report regarding the study on or before February 1, 2022, with a new report required every four years thereafter.
The law is described as a “proactive approach to address historical inequality and end discriminatory practices,” with New York leading the way. In signing the legislation, Governor Cuomo stated, “[f]rom new pay equity laws to strongest-in-the-nation sexual harassment policies, New York is leading the fight for gender equality in the workplace—but our work won’t be done until women are better represented at the highest levels of organizations.” Cuomo further stated that the new study would “help shed light on the problem and guide the development of new policies to ensure more women have a seat at the proverbial table.”
The Growing National Trend in Board Diversity Efforts
New York is not the only jurisdiction to implement corporate reporting aimed at increasing board diversity. Illinois passed a corporate reporting law in August 2019, requiring corporations to include additional board composition information in annual reports submitted to the Secretary of State. The additional required information includes the gender of each board member, various processes for identifying and appointing executive officers, and the corporation’s policies and practices for promoting diversity and inclusion among its board and executive officers. Maryland also enacted reporting requirements effective October 2019, requiring certain corporations to include in their annual reports the number of women serving on the board of directors and the total number of board members.
This legislation follows in the footsteps of California’s first-of-its-kind law requiring women to be represented on boards. As we previously reported, in 2018, California passed a law requiring publicly held corporations based in California to have at least one woman director by the end of 2019. The law also provides that by the end of 2021, corporations with five or more directors on the board must have at least two female board members, and boards with six or more board seats must have at least three women board members. The law—currently being challenged on constitutional grounds—imposes significant penalties for failing to comply and calls for publishing the names of compliant and non-compliant companies.
Legislation to increase board diversity and to require corporations to report board diversity is a growing trend in response to the #MeToo movement. Employers should take heed of the growing interest in legislation aimed to increase board diversity and should remain on watch for developments in the jurisdictions where they operate. Indeed, board diversity has piqued Congressional interest, as exemplified by the House’s passage of the Improving Corporate Governance Through Diversity Act of 2019, which would require public companies to annually disclose the gender, race, ethnicity, and veteran status of their board of directors, nominees, and senior executive officers, and would require the Securities and Exchange Commission to establish a Diversity Advisory Group to study strategies for increasing gender, racial, and ethnic diversity among boards of directors. In addition, some companies are already taking the reins in pressuring businesses to increase board diversity: for instance, Goldman Sachs recently announced that it would not take companies public in the U.S. and Europe if they do not have at least one diverse board director.
Not to be outdone by the New York State legislature’s flurry of eleventh-hour lawmaking (which we previously reported on here and here), the New York City Council recently passed an employment bill pending since April of 2018. The new law, Int. No. 0799-2018, amends and broadens workplace anti-retaliation protections under § 8-107(7)(v) of the New York City Human Rights Law (“NYCHRL”) by including that it is illegal to retaliate against an employee or applicant who requests a reasonable accommodation under the law. READ MORE
Major changes are in store for New York employers under a new bill passed in the waning hours of the 2019 legislative session. As part of an ongoing, multi-year effort to address sexual harassment and other discrimination and harassment issues, the New York legislature on June 19, 2019 passed Assembly Bill 8421 (“AB 8421”), a compendium bill that introduces new and refined employee protections against harassment, retaliation, and discrimination in the workplace. AB 8421 amends the New York State Human Rights Law (“NYSHRL”) to usher in new affirmative protections and procedural mandates that will significantly affect employer liability under state law. Building on protections previously enacted under the 2018 state budget, AB 8421 will expand prohibitions on nondisclosure agreements and arbitration agreements to categories of discrimination and harassment beyond sexual harassment. Key elements of AB 8421 are described below. READ MORE
The New York City Commission on Human Rights (“NYCCHR”) released its long anticipated model anti-sexual harassment training on April 1, 2019. The City’s model training satisfies all of the training requirements under both New York State and City laws, although the training is geared to educate viewers as to the broader sexual harassment protections afforded to workers by the New York City laws. READ MORE
Effective November 26, 2017, retail employees in New York City will be entitled to advance notice of their scheduled shifts, and the practice of “on-call shifts”–where an employee is required to be available to work but not necessarily called to work–will be prohibited. These provisions are part of new “Fair Workweek” legislation aimed at providing “predictable schedules and predictable paychecks” for retail and fast food workers in New York City.
The “cat’s paw” doctrine, a concept first coined by Seventh Circuit Judge Richard Posner in 1990 and adopted by the Supreme Court in 2011, applies when an employee is subjected to an adverse employment action by a decision maker who does not have any discriminatory animus but who bases his or her decision upon information from another who has such an improper motive. In Vasquez v. Empress Ambulance Service, Inc., the Second Circuit recently held that the “cat’s paw” theory may be used to support recovery for Title VII retaliation, in addition to discrimination, claims and then extended the doctrine to permit liability if the individual with the discriminatory or retaliatory motive is a low-level employee, not just a supervisor.
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.