3

June, 2021

The Courts Have Awoken: Takeaways Spring 2021

After a dearth of notable caselaw over the course of the pandemic, this past quarter brought five significant decisions across New York, New Jersey and Connecticut — addressing the parameters of employer obligations to medical marijuana users, the scope of New Jersey’s Pregnant Workers Fairness Act, business executives’ liability for harassing conduct by a supervisor, and New Jersey’s ban on arbitration of discrimination claims. Our Spring 2021 issue of Takeaways summarizes all those decisions, as well as recent employment law developments in New York and New Jersey resulting from the legalization of recreational marijuana usage, further updates on the ever-evolving maze of requirements related to COVID-19, expanded protections for discrimination related to employees’ hairstyles and head coverings, and a substantial increase in the minimum wage for federal contractors, taking effect in very short order.

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7

March, 2021

NJ Employers Need Special Expert’s Sign-Off Before Disciplining Based on a Positive Test for Cannabis

By Alexandra Lapes

On February 22, 2021, after nearly three years of deliberation, New Jersey became the 15th state to fully legalize cannabis for recreational and medical use.  That legalization process includes new employment law protections to users of cannabis products in certain circumstances and places significant constraints on drug testing of applicants and employees.

How We Got Here

During the November election, 67% of New Jersey voters had approved a ballot measure legalizing adult-use cannabis and a state constitutional amendment was adopted on January 1, 2021, pending regulation by the Cannabis Regulatory Commission to establish a regulated marketplace for cultivation, distribution, and the sale of cannabis.  However, lawmakers then discovered discrepancies in the legislation that were interpreted as legalizing cannabis for children and did not sign the cannabis measures into law until they reached an agreement on a clean-up bill.  In total, three adult-use cannabis reform measures were signed into law, namely, the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (“NJCREAMMA” or “legalization bill”), the decriminalizing marijuana and hashish possession bill (“decriminalization bill”), and the “clean-up bill,” clarifying cannabis use and possession penalties for individuals younger than 21 years old.

The decriminalization provisions of the cannabis bills took effect immediately upon signature.  The provisions affecting the employment relationship are not effective until the Cannabis Regulatory Commission provides rules and regulations, which is mandated within 180 days after the bill was signed into law, or within 45 days of appointment of all members of the commission, whichever is later.

Provides a New Protected Class

The NJCREAMMA prohibits employers from refusing to hire any person, or discharging, or taking any adverse action against an employee, because they use cannabis products, and explicitly protects employees from being subject to any adverse employment action solely because they have tested positive for cannabinoid metabolites.*  This is a change from prior versions of the bill, which had explicitly permitted employers to take adverse action against an employee for use of cannabis or cannabis items in certain circumstances.  While the new law thus creates a protected class for cannabis users in New Jersey, employers are still permitted to maintain drug and alcohol-free workplaces and policies, and employers can discipline employees who engage in some other prohibited conduct under the law, such as being under the influence, possessing, selling, or transporting cannabis while in the workplace.

Drug Testing Requirements

The NJCREAMMA does not require employers to drug test employees who they believe have engaged in prohibited conduct under the employer’s policy.  Instead, the law explicitly permits employers to drug test:

  • upon reasonable suspicion of an employee’s usage of a cannabis item while engaged in the performance of the employee’s work responsibilities;
  • upon finding any observable signs of intoxication related to usage of a cannabis item;
  • as random screening;
  • as pre-employment screening;
  • as regular screening of current employees to determine use during work hours; or
  • following a work-related accident subject to investigation by the employer.

The employer may then use the results of that drug test when determining the appropriate employment action concerning the employee, provided the drug test satisfies two prescribed requirements, specifically, that:

1. it is conducted with scientifically reliable objective testing methods and procedures (i.e. testing blood, urine, or saliva); and

2. a physical evaluation is conducted by a “Workplace Impairment Recognition Expert” (WIRE).

A WIRE is an individual with the necessary certification to opine on the employee’s state of impairment or lack of, related to the usage of cannabis.  To obtain a WIRE certification, an individual must be trained to detect and identify an employee’s use of cannabis items or other intoxicating substances and assist in the investigation of workplace accidents.  The Cannabis Regulatory Commission is tasked with creating minimum standards and courses of study available for full or part-time employees or others contracted to provide services on behalf of the employer, to become certified as a WIRE.

Drug and Alcohol-Free Workplaces Permitted

The NJCREAMMA states that employers are not required to amend, repeal, or otherwise affect an employer’s policy and efforts to maintain a drug and alcohol-free workplace, and employers are expressly permitted to implement and continue to enforce policies that prohibit the use, possession, or being under the influence of cannabis while in the workplace or during work hours. The NJCREAMMA also does not require an employer to permit or accommodate any personal use of cannabis activities in the workplace, and employers may take adverse employment action against any individual found to be engaging in any prohibited conduct under a workplace policy.  In addition, if the requirements of the NJCREAMMA would result in a provable adverse impact on an employer who is subject to a federal contract, then the employer may revise its employee prohibitions consist with federal law, rule, and regulations.

Questions Left Unanswered

The law is voluminous and leaves many questions unanswered about the practical implications of these new cannabis protections.  For example, if an employer suspects someone of coming to work with their ability impaired, must the employer send the employee for a drug test before taking further responsive action, or can the employer opt out of drug testing?  If the employer opts not to drug test, can it discipline or fire the person based on perceived impairment?

Clearly, if an employer does drug test, the WIRE certification is required.  However, there appear to be two competing provisions in the statute on whether a drug test is required before an employer can take any adverse employment action against an employee who comes to work apparently under the influence of cannabis.  One provision indicates that an employer is still permitted to maintain a drug and alcohol free workplace and can have policies that prohibit use of cannabis items or intoxication by employees during work hours, while another provision suggests that the WIRE certification process is not only intended for purposes of determining the reliability of a positive drug test but also to balance employers’ interest in maintaining a drug and alcohol free workplace with employees’ interest in not being improperly disciplined or discharged.

If the latter interpretation applies, then the law holds employers to a higher proof standard before taking adverse action against a cannabis user than in the event someone reports to work under the influence of alcohol.   If the former applies, then the greater protection for cannabis users only kicks in when an employer chooses to administer a drug test to an individual who is believed to be impaired, and the WIRE process essentially is meant to discourage employers from relying solely on drug tests.  Employers will need to await regulatory guidance to clarify the circumstances under which an employer needs to involve a WIRE.

Employers should review and revise their drug testing policies and procedures now to ensure they do not include any outright bans on cannabis use that are inconsistent with the NJCREAMMA and be alert for further regulations on certification standards set by the Cannabis Regulatory Commission, which may require further updates to employer policies and practices.

*Editor’s note: This article was updated 3/15/21 to correct a misstatement regarding the scope of the protection against adverse action.

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12

February, 2021

NYC Upends Employment at Will – Revolutionary Change in the Fundamentals of US Employment Law

By Tracey I. Levy

Employment “at will” — the ability to fire an individual for any reason or no reason at all and the individual’s right to quit at any time — has been the bedrock principle of the employment relationship in the United States throughout its history.  Collective bargaining agreements modify that relationship, contractually, in the union context.  Individual employment agreements may similarly include contractual limitations on the employment at will doctrine.  Employment laws modify employment at will by precluding employers from terminating an individual for a discriminatory, retaliatory, or similarly unlawful reason.

But now New York City has gone one step further and abolished the concept of employment at will in its entirety in the discretely targeted area of the fast food industry (defined as fast food chains with 30 or more operating establishments nationally).  While the law thereby will have limited application in its current form, the radical shift that the New York City law presents cannot be understated.  We are unaware of any other state, city or locality that has superseded the principle of employment at will for an entire industry, thereby requiring private employers to demonstrate “just cause” before taking any significant, adverse employment action against an individual employee.*

New York City’s new law expands on prior restrictions requiring “predictive scheduling” for hourly fast food workers to now provide that, absent “just cause” or a “bona fide economic reason,” once such employees successfully complete a 30-day probationary period they cannot be “discharged”, which means not only that they cannot be fired, but that they cannot be suspended indefinitely, laid off, or subjected to more than a 15% reduction in their scheduled work hours.  While “discharged” is thus defined quite broadly, the new law defines “just cause” quite narrowly, as an employee’s “failure to satisfactorily perform job duties or misconduct that is demonstrably and materially harmful to the fast food employer’s legitimate business interests.”  The law then builds on that definition to provide that, absent “egregious” behavior, the just cause standard cannot be satisfied unless the employer already has in place a written progressive discipline policy that was provided to the employee, and the employer followed its progressive discipline process.  Disciplinary actions taken more than a year prior to the discharge effectively expire, as the law says they cannot be considered part of the progressive discipline process.  Finally, employers need to be careful with their documentation, as they must provide the impacted employee with a written explanation of the precise reason for discharge within five days, and they effectively waive the right to later defend their action based on any reason that is not included in that written explanation.

To assert that termination was due to a “bona fide economic reason,” the employer must show through its business records that, in response to reduced production volume, sales or profit, it needs to fully or partially close its operations or make technological or organizational changes.  When invoking this standard as a reason for discharge, employees must be let go in reverse order of seniority, so that the longest tenured employees are the last to go and the first to be rehired.  For a twelve-month period following such a discharge, the employer has to make “reasonable efforts” to reinstate former employees before it can offer shifts to other employees or hire anyone new.

Employees are entitled to reinstatement if they are found to have been discharged without just cause, plus the employer must bear the cost of the employee’s reasonable attorneys’ fees and may be liable for back pay and punitive damages.  As a further penalty, the employer will be liable for schedule change premiums, as provided under the existing predictive scheduling law, for each shift the employee loses as a result of having been discharged without just cause.  Alternatively, the law makes arbitration available as an option to employees, beginning in January 2022, and provides that a losing employer must reimburse the city for the cost of the arbitration.

The broad definition of “discharge”; narrow definition of “just cause”; precise policy, notice and documentation requirements; and heavy financial costs imposed on a losing employer collectively provide fast food employees with unprecedented job protection, likely greater than that provided anywhere else in the country.  Even well-intentioned employers that are indisputably contending with employees presenting persistent attendance issues, repeated underperformance, or offensive behavior may find themselves tripped up by the procedural requirements of the law, particularly the five-day window to thoroughly document the precise reason for discharge.  Similarly, by defining a work schedule reduction of more than 15% as a “discharge”, the new law brings the full weight of the documentation and enforcement provisions down on employers endeavoring to adjust work schedules to meet business needs.

Finally, the law’s recognition of seniority as the sole basis for determining employee selections in the event of a downsizing or restructuring deprives employers of necessary flexibility in making selection decisions.  The longest tenure does not consistently equate with the best performance and skillset, yet the law fails to recognize the relevance or legitimacy of those factors in reviving a struggling business.

While the applicability of this law is limited to a discrete industry, its import is manifold greater.  Government-mandated paid sick leave was unheard of in the private sector when it was adopted by San Francisco in early 2007, and in the subsequent 14 years such laws have proliferated to 13 states, the District of Columbia, and discrete localities in at least five other states.  The precedent has been set, and absent responsive action by the business community, it may not be long before employment at will fades away as past history.

*Editor’s Note 11/28/21: At the time this article was posted, we overlooked the Montana Wrongful Discharge from Employment Act, which after a probationary period, prohibited termination of an employee except for good cause.  Montana substantially amended its law as of April 1, 2021 to dial back employee protections.  The revised law considerably extends (to as long as 18 months) the probationary period during which employees can be terminated without cause, grants broader employer discretion in determining “good cause,” and provides employers with the “broadest discretion” when terminating managerial or supervisory employees.  It also imposes certain procedural limitations that further reduce the scope and viability of the law’s protections for employees.

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8

March, 2020

Managing Workplace Epidemics: Coronavirus Concerns in Westchester County and New York City

By Tracey I. Levy, Esq. and Alexandra Lapes, Esq.

As the global Coronavirus situation is expanding rapidly and hitting close to home, Westchester County and New York City employers should review their communicable disease plans and implement preventative measures to limit the potential effect of illness in the workplace.

Key strategies for employers in preparing and responding to a Coronavirus outbreak are:

  1. Implement a communicable disease policy

If your organization has not done so already, HR professionals should devise a communicable disease policy and prevention plan in case the outbreak directly impacts their workplace.  An effective policy should identify and communicate the organization’s objectives and address workplace safety precautions, such as employee travel restrictions, mandatory reporting of exposure, reporting to public health authorities, employees quarantined or in isolation, and facility shutdowns.

Employers should also establish policies to encourage employees who feel sick to stay home, post reminders on proper handwashing and coughing/sneezing practices and make hand sanitizers and tissues available throughout the workplace. Remind employees of relevant policies that may provide them with paid time off in these circumstances, including time off under Westchester County’s Earned Sick Leave Law and New York City’s Earned Sick and Safe Time Act, as discussed below.

  1. Make sure not to discriminate

Because of the heightened risk that COVID19 presents for individuals with underlying medical conditions, in the course of implementing a communicable disease policy or administering a response to the current Coronavirus threat employers may learn, inadvertently or otherwise, of latent disabling conditions impacting some of their employees.  Employers should treat all such information as confidential, and take care not to engage in any actions that could be perceived as discriminating based on a disability.

Employers also should avoid, and take measures to prevent, any harassment or discriminatory actions that target individuals who may be associated with an ethnic or religious group, or who have relatives from a particular country, that has been more substantially impacted by the spread of the virus.  Employment policies should be consistent with public health recommendations, as well as local, state, and federal workplace laws.

  1. Consider alternative work arrangements

Encourage sick employees to stay home and focus on their health, and recovering employees or those who have been asked to self-quarantine to do so.  Consider flexible work schedules to limit the number of workers in the same work area or worksite, reduce exposure during commutes on mass transit at peak times, and reduce face-face contact.  Use virtual work environments to replace in-person meetings with video or telephone conferences. Leverage remote access solutions where logistically possible to enable healthy employees to stay productive in the event the workplace or specific individuals are subject to a quarantine.

  1. Advise employees before traveling

Employers should continuously check the CDC’s Traveler’s Health Notices for the latest guidance and recommendations for each country to which an employee may need to travel.  Advise employees to check themselves for symptoms before travelling and notify their supervisor if they need to stay home.  If an employee becomes sick while travelling or on temporary assignment, ensure the employee understands to notify a supervisor and promptly call a local health care provider.  New Yorkers can call the State hotline at 1-888-364-3065, and for Westchester County COVID-19 information call 211.

  1. Manage employee benefits and compensation

Non-exempt employees must be paid overtime compensation if they work in excess of 40 hours in a workweek while covering for other employees absent due to the Coronavirus.  Time spent working from home or through other remote work arrangements also is compensable.

Most employees in Westchester County and New York City will be eligible for up to five days of paid sick leave, under local paid sick leave laws, if they personally contract the Coronavirus, their workplace is closed due to a public health emergency, they are caring for a family member who has contracted the virus, or they are caring for a child whose school or childcare provider is closed due to a public health emergency.

Employers should consider whether, independent of any available paid leave time, they want to continue to pay employees for all or some portion of the time that they are unable to or are precluded from working because of the Coronavirus.  While some organizations have suggested leave donation plans as a means of encouraging sick employees to stay home if they have exhausted their paid time-off benefits, such programs need to be carefully considered.  If not appropriately structured, the donated time can have tax consequences for the donor and the recipient.  Further, the benefits of such a program for small and mid-size employers may prove to be few or fleeting in the context of a pandemic, as donated time may benefit the first to fall ill, but then leave little in the bank for the donors and others who later contract the disease.

New York State Paid Family Leave is available for employees who may need to care for a close family member with a serious health condition.  However, the state defines a “serious health condition” as an “illness, injury, impairment, physical or mental condition requiring inpatient care in a hospital, hospice, or inpatient/outpatient residential health facility;” or “continuing treatment or supervision by a health care provider.”  Under this definition, care of a family member who is hospitalized due to Coronavirus or who has complications from the virus due to an underlying medical condition, such as asthma or respiratory disease, likely would be covered.  Care of a family member who experiences milder Coronavirus symptoms, more akin to the flu, likely would not be covered.

  1. Stay informed on changes to state and local law

Local paid sick leave laws in Westchester County and New York City present some additional challenges for employers.  The laws permit employers to require employees to provide documentation from a health care provider after three consecutive sick days, but employers may not require the health care provider to specify the medical reason for sick leave.  Employers need to balance this provision against the need to be informed, for public safety reasons, if an employee has been diagnosed with the Coronavirus or is being quarantined so as to take appropriate precautions to prevent the further spread of the virus throughout the workplace.  Also, the National Centers for Disease Control and Prevention advises employers not to require medical certification at this time to validate employees who are sick with acute respiratory illness, as they anticipate healthcare providers and medical facilities may be extremely busy and not able to provide such documentation.

Notably, while it has been widely reported that New York State Governor Cuomo plans to amend New York State’s paid sick leave bill to deal with the Coronavirus, there currently is no state-wide paid sick leave law in New York.  Paid sick leave at the state level is simply proposed legislation that needs to make its way through the legislative process and, even if enacted, as proposed the law would not take effect until April 2021.

  1. Employee morale and business continuity

Lastly, employers should endeavor to communicate information to employees about their organization’s communicable disease plan, efforts to reduce the risks of contagion in their workplace, and policies and benefits for those who are directly impacted by the Coronavirus.

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12

August, 2019

New York State Amends Other HRL Discrimination Protections – Broad Protections Expanded Well Beyond Sexual Harassment

By Tracey I. Levy, Esq. and Alexandra Lapes, Esq.

Just over a year after New York enacted sweeping protections against sexual harassment, Governor Cuomo today signed into law further amendments to the New York State Human Rights Law to provide more expansive protections for employees based on any protected characteristic.

SPECIAL ALERT – IMMEDIATE ACTION REQUIRED

Distribute Policy for Harassment Prevention Training

Of most immediate concern, employers who are racing to comply with the October 9 deadline for year one of harassment prevention training should note that, effective immediately, employers are mandated to distribute a copy of their sexual harassment prevention policy at every training session, as well as at hire, both in English and in the employee’s primary language.

Other Significant Changes

In addition to the policy distribution requirement, New York State’s new law extends the Human Rights Law’s requirements to employers of any size, as well as domestic workers, and expands the law’s protections to contractors, consultants and vendors who can show the employer knew or should have known of discrimination directed at them and failed to take immediate and appropriate corrective action that was within its ability.

In addition, the new law:

  • Broadly defines unlawful harassment as subjecting an individual to inferior terms, conditions, or privileges of employment because of an individual’s protected characteristic(s);
  • Eliminates the employee’s obligation to prove that harassing conduct is severe and/or pervasive;
  • Declares that an employee need not show that a comparative individual was treated more favorably;
  • Mandates that the state’s Human Rights Law be construed liberally, regardless of how comparable federal or other states’ laws may be interpreted; and
  • Eliminates the employer’s ability to defend the complaint on the grounds that the employee failed to raise an internal complaint;
  • But it permits employers to defend a claim by proving that the harassing conduct does not rise above the level of what a reasonable person in the shoes of the plaintiff would consider petty slights or trivial inconveniences.

For most employers, these changes will not require any revisions to their existing harassment prevention policy.  However, the “sidewalks” that most policies build around the legal standards have now gotten much narrower, and the amendments collectively make it significantly easier for an employee to support a legal claim of unlawful harassment.  Procedurally, the law increases the remedies available in litigation to include punitive damages and attorneys’ fees for a prevailing plaintiff (while an employer can seek recovery of its attorneys’ fees only if it shows the case was frivolous); and extends the statute of limitations for sexual harassment claims from one to three years.  With the exception of the change in the statute of limitations (which takes effect one year after enactment of the new law), all these changes take effect within the next 60 to 180 days.

Moving beyond litigation, the new law expands the confidentiality and mandatory arbitration clause restrictions adopted last year for sexual harassment claims to now apply to any claim of harassment or discrimination under the Human Rights Law, and it voids out any confidentiality clause to the extent it precludes participation in a government agency investigation or impedes a complainant’s filing for unemployment insurance, Medicaid or other public benefits.  As of January 1, 2020, any non-disclosure provision to which a complainant affirmatively consents must include language confirming that it does not prevent the employee from speaking with law enforcement, a human rights enforcement agency, or an attorney.

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