New York Governor Kathy Hochul recently signed S.B. 4394, an amendment of Section 740 of the New York Labor Law that amounts to a significant expansion of safeguards for whistleblowers. Effective January 26, 2022, the new law broadens the definition of retaliation, creates new notice and reporting requirements, extends certain protections to former employees and independent contractors, and increases potential damages, among other things discussed in greater detail below.

Who is an “Employee” Under the New Law?

Formerly, whistleblower protections were only extended to those “who perform[ ] services for and under the control and direction of an employer for wages or other remuneration,” as that was the definition of “employee.” However, under the amended law, the range of people protected from retaliation includes current and former employees as well as independent contractors.

What Kind of Activity is Protected Under the New Law?

Under the old law, employees were only protected when reporting a violation that created a substantial and specific danger to public health or safety. By contrast, the amended law protects those who disclose or threaten to disclose anything relating to practices and activities that the employee “reasonably believes” (1) violate a law rule, or regulation, or (2) pose a substantial and specific danger to public health or safety. The employee is also protected if he provides information to or testified before a public body, or objects or refuses to participate in the subject policy or practice.

What Constitutes Retaliation Under the New Law?

Under the old law, the definition of retaliatory conduct was limited to the discharge, suspension or demotion of an employee, or other adverse employment action. Now, the law also protects against actual or threatened adverse employment actions, including (1) the above-described conduct, (2)  conduct that would adversely impact a former employee’s current or future employment; and (3) the contacting of immigration authorities or reporting the immigration status of employees or their family members.

How Have the Reporting Requirements Changed?

Under the old law, employees had to report any violations to their employer first, before disclosing it to a public body. This was intended to give the employer a reasonable opportunity to correct the alleged violation. The amended law, however, requires only that employees make a “good faith” effort to notify their employer first. Further, the employee can entirely bypass that step, and go straight to public disclosure if the employee reasonably believes: (1) that there is imminent and serious danger to public health or safety; (2) that reporting the alleged wrongdoing to their employer will result in the destruction of evidence, concealment, or harm to the employee; or (3) that his supervisor already knows of the violation and will not correct it.

What Else Has Changed?

Under the old law, a plaintiff could seek (1) injunctive relief; (2) reinstatement; (3) compensation for lost wages, benefits, and other remuneration; and (4) reasonable costs, disbursements, and attorneys’ fees. The law now allows for a jury trial and permits, in addition to existing remedies, front pay in lieu of reinstatement, the recovery of up to $10,000 and punitive damages. If the plaintiff prevails, he may be entitled to injunctive relief, reinstatement, compensation for lost wages, benefits, and other remuneration, and reasonable costs, disbursements, and attorneys’ fees. Importantly, the amended law also expands the statute of limitations from one to two years. However, it is also of note that, if the court finds that a retaliation claim was brought without basis in law or fact, the employer may now be awarded reasonable costs and attorney fees.

Recommendations for Employers Going Forward

Employers are required to post notice of the employees’ protections, rights and obligations under the new law. The notice should be conspicuous, meaning in an accessible and well-lighted place. A model posting will likely be available at the Department of Labor website in advance of the law’s effective date. Additionally, it may be appropriate to provide additional training for managers responsible for receiving and escalating whistleblower complaints. Further, it may be advisable to contact counsel when presented with reported violations by employees.

For further information on New York’s whistleblower laws or how to revise your company’s policies, contact David Paseltiner at 516-746-8000.

 

 

 

As we discussed in an earlier related blog post, effective March 31, 2021, the Marijuana Regulation and Taxation Act (“MRTA”) legalized the use of recreational marijuana for adults who are 21 and older and amended New York Labor Law 201(d), among other revisions, to prohibit employers from discriminating against an employee for such employee’s “legal use of consumable products, including cannabis in accordance with state law, prior to the beginning or after the conclusion of the employee’s work hours, and off of the employer’s premises and without use of the employer’s equipment of other property.” Recently, the New York Department of Labor (“DOL”) issued guidance on MRTA, which delineates permitted employer actions and answers to frequently asked questions.

Employers cannot test for cannabis and cannot rely on drug workplace policies existing prior to the effectiveness of MRTA, except for limited circumstances, such as if drug testing is specifically required by law. However, employers can implement new policies prohibiting cannabis use during work hours or on the employer’s property in compliance with the law.

What constitutes “work hours”?

Under the DOL guidance, “work hours […] means all time, including paid and unpaid breaks and meal periods, that the employee is suffered, permitted or expected to be engaged in work, and all time the employee is actually engaged in work. Such periods of time are still considered ‘work hours’ if the employee leaves the worksite.” Additionally, employers can prohibit cannabis while an employee is on call or “expected to be engaged in work.”

What is employer’s property?

Employers can prohibit use and even possession of cannabis on the “employer’s property, including leased or rented space, company vehicles, and areas used by employees within such property (e.g. lockers, desks, etc.).” The DOL guidance further states that “employers are permitted to prohibit use in company vehicles or on the employer’s property, even after regular business hours or work shifts.”

Can an employer take action against an employee for using cannabis on the job?

Yes, employers may take employment action against an employee if the employee manifests specific articulable symptoms of impairment that (i) decrease or lessen the performance of their duties or tasks and (ii) interfere with an employer’s obligations to provide safe and healthy workplace, free from recognized hazards as required by state and federal occupational safety and health laws (such as the operation of heavy machinery in an unsafe and reckless manner). Articulable symptoms of impairment are objectively observable indications that employee’s performance of the duties of the position of their position are decreased or lessened, however, the DOL guidance cautions that “such articulable symptoms may also be an indication that an employee has a disability protected by federal and state law (e.g., the NYS Human Rights Law), even if such disability or condition is unknown to the employer. Employers should consult with appropriate professionals regarding applicable local, state, and federal laws that prohibit disability discrimination.” Additionally, the DOL guidance specifies that the smell of cannabis alone is not an articulable symptom of impairment.

For further information or guidance on revising your policies and procedures, please contact David Paseltiner.