Employers in New York State should be aware of recent new laws as well as some pending bills, all of which seek to bolster harassment and discrimination protections for employees. As detailed below, New York Governor Kathy Hochul recently signed several bills into law that expand harassment and discrimination protections, while the New York Senate recently passed more bills that would further bolster safeguards for employees and independent contractors in the state.
Release of Personnel Files as Retaliation Under the NYSHRL
Senate Bill 5870/Assembly Bill 7101, which was signed into law by Governor Hochul on March 16, 2022, amends the New York State Human Rights Law (NYSHRL) to make the release of personnel files an unlawful retaliatory action in limited circumstances. The new law changes the definition of “retaliation” to include the disclosure of personnel files because the employee filed a complaint or cooperated with proceedings involving unlawful discriminatory practices. The legislative history of the law indicates that this was a direct reaction to the aftermath of the allegations against former Governor Andrew Cuomo’s actions during the probe into his sexual harassment allegations (during which investigators concluded in their report that personnel files of an accuser were leaked in response to her allegations). It’s not clear how broadly this provision will be implemented in practice. The new law is effective immediately.
Workplace Sexual Harassment Hotline Established
Senate Bill 812B/Assembly Bill 2035B, which was also signed into law by Governor Hochul on March 16, 2022, amends the NYSHRL to establish a toll free confidential hotline to provide counsel and assistance to individuals with complaints of workplace sexual harassment. The hotline will be operated by the New York State Division of Human Rights (NYSDHR) during regular business hours. The new law is effective July 14, 2022.
Definition of Covered Employer Clarified
Governor Hochul also signed Senate Bill S3395A/A2483B into law on March 16, closing a loophole in the NYSHRL that had left staff members of elected state officials and judges excluded from the protections of the state’s laws regarding sexual harassment prevention and remediation. The amendment took effect immediately.
Expansion of Statute of Limitations for Discrimination Claims
Two potential amendments to New York State law would increase certain statutes of limitations to provide more time for individuals to litigate discrimination claims.
Senate Bill 566A seeks to expand the NYSHRL statute of limitations for filing discrimination claims with the NYSDHR. The law presently provides for one year for the filing of most employment discrimination claims, but gives individuals with sexual harassment claims three years, pursuant to a 2019 amendment to the law. SB 566A would align the statute of limitations for all discrimination claims by making it a uniform duration of three years. If enacted, SB 566A would become effective 90 days later, applying only to claims arising after that date.
Another pending bill, Senate Bill 849A, would amend the New York Civil Practice Law and Rules (CPLR), which governs procedures for civil lawsuits, to extend the statute of limitations for civil actions alleging unlawful discrimination from three years to six years. SB 849A would become effective 60 days after being signed into law.
Both bills have been passed by the Senate and have been sent to the Assembly for review.
Limitations on Settlement Agreements
Two bills would limit certain clauses from being included in settlement agreements or releases of claims in the employment context.
Senate Bill 738 would modify the New York General Obligations Law, which places limitations on employment-related settlement agreements, by clarifying that the law applies to settlements of discrimination claims in the nature of harassment and retaliation, including those made between employers and independent contractors. SB 738 would also add new provisions to the law to prohibit such agreements from containing certain mechanisms that would discourage a complainant from disparaging the employer or otherwise disclosing certain details related to the claim. Specifically, if enacted, the new law would ban any contractual provision that would require a complainant to: (i) pay liquidated damages in the event that the complainant violates a nondisclosure agreement or non-disparagement clause; (ii) forfeit consideration received under the agreement if the complainant violates a nondisclosure agreement or non-disparagement clause; or (iii) make an affirmative statement, assertion, or disclaimer that the complainant was not in fact subject to unlawful discrimination, including discriminatory harassment, or retaliation.
The bill also would amend a requirement that all nondisclosure agreements or confidentiality clauses within settlements of discrimination claims be subject to a full 21-day waiting period. Instead, complainants would be afforded “up to twenty-one days” to consider such a term or condition, the inclusion of which remains solely at the complainant’s discretion, subject to a written agreement that is signed by all parties and a revocation period of at least seven days after the agreement is fully executed. This would be a significant change, since, by now allowing a complainant to shorten the 21-day review period, the current law conflicts with the federal Age Discrimination in Employment Act (ADEA). SB 738 would become effective upon enactment and would apply to agreements entered into on or after that date.
Senate Bill 766 would also modify the General Obligations Law by adding a new section that prohibits “no rehire” clauses in agreements that release claims against an employer. This bill would likely be broadly read to apply to all separation agreements, and not just those settling claims of harassment, discrimination, or retaliation. While permitting termination of existing employment within terms and conditions of a settlement agreement, the new law would render any employee’s or independent contractor’s release of a claim against an employer unenforceable if a settlement agreement prohibits the employee or independent contractor from applying for, accepting, or engaging in future employment with the employer or any related entities.
However, the law would not render the entirety of a settlement agreement unenforceable if it includes an unlawful “no rehire” clause. While employers whose settlement agreements violate this provision could end up facing claims that were meant to be settled, they remain bound by all other provisions of the agreement, including any payment or other consideration promised to the employee. This new law would cover agreements involving all private and public employees as well as independent contractors. If enacted, SB 766 would become effective 60 days later and would apply to agreements entered into on or after that date.
Both bills have passed in the Senate and have been advanced to the Assembly for consideration.
We will continue to monitor the proposed bills and provide updates if they become enshrined in law.