October 14, 2009

2009 has been a year of change in labor and employment laws for New York based employers. Below are a number of the most significant changes.

1. Employee Notification Requirement
   
   Effective October 26, 2009, pursuant to Section 195(1) of the New York State Labor Law, employers are required to give written notice of the rate of pay, the hourly overtime rate of pay (if applicable), and the regular payday to employees upon hire. Also, a written acknowledgement must be obtained from the employee at the time the notice is provided. The requirement does not apply to employees hired prior to October 26, 2009. Under this amendment, a non-exempt employee (whether paid by the hour or otherwise) now must be told – in writing – his/her overtime rate. This change in the law is another reason why it is important for employers to correctly identify which employees are exempt from the overtime provisions of federal and state law. The New York State Department of Labor ("NYDOL") has not yet promulgated regulations or a sample acknowledgement form. Other employer "notice" provisions of Section 195, including those requiring written notification of employee terminations, changes in paydays and benefits/time-off policies, remain unchanged.
2. Criminal Convictions
   
   Effective February 1, 2009, employers must post a copy of the New York Correction Law (Article 23-A). This posting identifies the extent to which prior criminal convictions may be a consideration in hiring and retaining employees. This law must be posted in a visually conspicuous manner in an accessible workplace location.
3. New York WARN Act
   
   Also effective February 1, 2009, is the New York State Workers Adjustment and Retraining Notification (NYSWARN) Act which requires employers to provide 90 days notice prior to a plant closing, mass layoff or relocation occurring on or after February 1, 2009. Notice must be provided to affected employees and their representatives, the New York State Department of Labor and the local workforce investment board at least 90 days before the event. The NYSWARN applies to private employers with 50 or more workers who separate or layoff at least 25 employees in a specific period of time. The NYDOL enforces the law. Violators face civil penalties and back wages.
4. Increases to Rates of Pay
   
   With the increase in the federal minimum wage to $7.25 per hour, effective July 24, 2009, minimum wage rates and allowances also increased under New York law. Rates for tips, uniform maintenance, meals, lodging, and executive & administrative exemptions under New York Labor Law increased proportionally. For example, the minimum weekly salary to satisfy the white collar "executive" exemption to the payment of overtime remains at $455.00 under federal law, but as of July 24, 2009, New York employers must pay at least $543.75 per week or the exemption will not be recognized by the NYDOL. Rates for tips, uniforms, etc. are accessible on the NYDOL’s website, http://www.labor.state.ny.us/.
5. New York State Human Rights Law
   
   With the large number of incidents of domestic violence (and its deleterious effect on all aspects of the victim’s life including in the workplace), effective July 7, 2009 the New York State Human Rights Law ("NYSHRL") was amended to protect domestic violence victims from employment discrimination. An employee may not be terminated because she/he is a domestic violence victim. Similarly an employee may not be treated differently with regard to any term, condition or privilege of employment because the employee is a victim of domestic violence. Although not explicitly mandated, an employer must grant a domestic violence victim time off for needed medical or mental health services provided it does not create undue hardship to the employer. An employer may request a note from the service provider, as long as the employer requires all employees to provide a note in similar circumstances not related to domestic violence.

   Effective July 6, 2009, the NYSHRL allows for the imposition of civil penalties against employers found to have engaged in discriminatory employment practices. Penalties may be as high as $50,000 for non willful violations and up to $100,000 for willful, wanton or malicious acts. Guidelines have not yet been established for determining the amount of penalties to be imposed in each case. Of course, traditional employment discrimination remedies such as back wages, compensatory damages and injunctive relief remain available.
6. Federal and New York State COBRA
   
   On July 29, 2009, continuation health coverage under the law was extended to 36 months. By way of background, the federal Consolidated Omnibus Budget Reconciliation Act (COBRA) allows employees who work for employers with 20 or more employees to continue their current group health insurance once they leave employment or have a reduction in hours that makes them ineligible for employer-sponsored coverage. New York State continuation coverage, also known as "mini-COBRA," gives the same right to employees who work for employers with fewer than 20 employees. Prior to the new law, the length of time a person could have state continuation coverage depended on the reason why the person was losing coverage. Now, a person eligible for mini-COBRA may continue their coverage for a total of 36 months, regardless of the reason for the coverage loss. For those eligible for federal COBRA, they may elect 18 months of COBRA and then an additional 18 months of mini-COBRA, for a total of 36 months.

   The foregoing COBRA coverage extension is in addition to the federal COBRA and mini-COBRA premium subsidy available under the American Recovery and Reinvestment Act of 2009 (ARRA). The ARRA provides for premium reductions and additional election opportunities for health benefits under COBRA. Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a payroll tax credit. The premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and lasts for up to nine months for those eligible for COBRA during the period beginning September 1, 2008 and ending December 31, 2009 due to an "involuntary termination" of employment that occurred during that period.