New York Governor Kathy Hochul signed legislation into law that broadens the protections available to individuals who claim retaliation for reporting alleged employer wrongdoing. The legislation (S.4394A/A.5144A) amends NY Labor Law Section 140, which prohibits retaliation by employers against whistleblowers. Effective 90 days after the Governor’s signature (January 26, 2022), the amendments alter the regulatory landscape for New York employers by expanding both who is protected by the law and what constitutes protected activity.
Under the current law Section 140 prohibited retaliation against employees who disclose an “activity, policy or practice that is in violation of law, rule or regulation” and only when such violation “creates and presents a substantial and specific danger to the public health or safety” or concerns health care fraud. The amendments expand the scope of protected activity to include disclosures about what “the employee reasonably believes is in violation of law, rule or regulation or that the employee reasonably believes poses a substantial and specific danger to the public health or safety”.
Other key changes to the amendments include:
- Covered employees – the definition of “employee” now includes former employees and independent contractors.
- Retaliatory Conduct – the new law expands retaliatory conduct to include:
- Actual or threatened adverse employment actions, including discharge, suspension, or demotion, related to the terms and conditions of employment;
- Actions or threats that would “adversely impact a former employee’s current or future employment”;
- The actual or threatened contacting of immigration authorities or reporting the immigration status of employees or their family members.
- Notice Posting Requirement – employers are now required to inform employees of their protections, rights, and obligations under Section 140 by posting a notice. Employers must post these notices “conspicuously in easily accessible and well-lighted places customarily frequented by employees and applicants for employment.” It is expected that the New York Department of Labor will issue a model notice to employers to use prior to the January 26, 2022 effective date.
- Notice requirement – the current law requires that employees bring the alleged violation to the attention of the employer and give the employer a reasonable opportunity to correct the violation before disclosing to a public body. The new law only requires employees to make a “good faith” effort to notify their employer before disclosing to a public body. Additionally, the good faith effort will not be required if:
- There is imminent and serious danger to public health or safety;
- The employee reasonably believes that reporting to the employer would result in a destruction of evidence or other concealment of the violation;
- The alleged violation could reasonably be expected to lead to endangering the welfare of a minor
- The employee reasonably believes that reporting would result in physical harm to the employee or any other person; or
- The employee reasonably believes the employer is already aware of the activity and will not correct it.
- Statute of Limitations – the statute of limitations for filing a claim under the law is extended from one year to two years.
- Remedies – under the current law the remedies are limited to: injunctive relief; reinstatement; compensation for lost wages, benefits, and other remuneration; and reasonable costs, disbursements, and attorneys’ fees. The new law adds additional remedies consisting of front pay in lieu of reimbursement, a civil penalty of $10,000, and punitive damages. Plaintiffs will also be entitled to a jury trial for claims brought under this law.
Employers need to review these changes and update their policies and procedures to ensure that they are compliant.