The year 2016 brought major developments in employment law. Many of the headline-grabbing developments came out of federal agencies, most of which are now called into question with the looming change in administration in Washington. However, there have also been a number of important developments at the state level, which are likely to be challenges for New York employers. Since the state developments will proceed, they will be the focus of this update.
State Law Developments
The New York Department of Labor (NYDOL) has been at the fore- front of changes that will hit employers’ bottom line. Earlier this year, the NYDOL approved regulations which phase in increases to the minimum wage over the next five years, beginning on December 31, 2016. For the first time, these wage increases vary by region, with large New York City employers reaching $15/hour at the end of 2020, with lesser increases Upstate. Under the regulations, Upstate employers must increase the minimum wage for five years by $.70/hour each year on December 31, beginning in 2016, which will result in an initial mini- mum wage of $9.70/hour and climb to $12.50 by December 31, 2020.
New York will also introduce a Family Leave Act effective December 31, 2017. This requires a phase in of paid leave for all private employers—even those with only one employee—in New York State for employees to deal with family medical issues. Recently, a representative of the New York State Business Council opined that the coverage for small employers is not likely to change, as that is part of the legislation, and therefore would be very difficult to tweak. This means that all New York employers with under 50 employees should start studying the Family Medical Leave Act, because the state regulations borrow heavily from the FMLA.
Finally, the Department of Labor has, at the time of this writing, issued proposed regulations which would increase the uniform allowance for hospitality workers. The salary basis test for executive and administrative exempt employees, also increases with the weekly minimum going to $727.50 effective December 31, 2016. The regulations are expected to go forward, although it is not clear when that will be.
The State Division of Human Rights (DHR) has also broadened its liability for discriminatory actions by employers to include actions based on a person’s relationships or associations. This mirrors changes introduced at the federal level, where the Supreme Court decided that employers could be liable for discriminating against an employee based on their association with another person. This adds to the expanded scope of the State Human Rights Law, which also protects sexual identity and sex stereotyping against discrimination. The DHR now provides a hotline for members of the public to report incidents of bias and discrimination. With anticipated changes com- ing at the Federal level, look for the DHR to increase its investigative and watch dog role in the state over the next several years.
At the time of the writing of this article, the overtime regulation changes which would have increased the salary basis test for most exempt employees to $913.00/week has been blocked by a federal court and the Department of Labor has filed an appeal, asking for expedited review. With the new administration in Washington, the fate of this regulation is very much up in the air, as it is unclear whether a Trump administration will continue to oppose the legal challenges.
There are a number of other initiatives from the Obama administration that may not survive the Trump administration, either through lack of funding, lack of opposition in court or executive action retracting the Obama administration actions. These include an executive order prohibiting sexual discrimination for federal contractors, EEOC guidelines on transgender bathroom access rights, EEOC-proposed regulations requiring pay data to be reported on EEO-1 forms, and paid sick leave for federal contractors. These are some of the top employment changes which appeared in 2016, and are expected to face reversal or revisions in the Trump administration.
The National Labor Relations Board currently has vacancies, and President-Elect Trump will have the opportunity to appoint a majority to the board. This board has been extremely active in recent years, issuing far-reaching opinions on employee handbooks, employee speech rights under the National Labor Relations Act, and other matters, expanding its footprint well beyond organized labor questions where it typically held sway. It is expected that the National Labor Relations Board will pull back significantly from its activism, and become much more employer friendly. Similarly, the Department of Labor, the EEOC, OSHA, and other agencies governing workplaces are likely to change their enforcement priorities in the upcoming year, and are expected to be pro-business.
Finally, the Affordable Care Act has a large target on it from the Republican controlled federal government. The Act itself is so complex, it is impossible to predict how it may be changed, but change is nearly certain in this and other areas with the new Republican administration.
Jacqueline Kelleher is an attorney with the law firm of Stafford, Owens, PLLC, who represents employers before administrative agencies and advises on day to day questions.