New York City Seeks to Ban Employer Inquiries Into Applicants’ Salary History

On April 5, 2017, the New York City Council passed a law amending the New York City Human Rights Law, barring all public and private New York City employers from asking job applicants about their prior wages and salary history.  The bill has been sent to Mayor DeBlasio for signature.  This new proposed law will take effect 180 days after Mayor DeBlasio signs it.

This bill would prohibit New York City employers from:

  • Making an inquiry, either verbally or in writing, to an applicant and/or the applicant’s current or prior employer, to obtain the applicant’s salary history;
  • Searching public records for an applicant’s salary history; and/or
  • Relying on a job applicant’s salary history when making an offer of employment or extending an employment contract to the applicant.

Salary history is broadly defined in the bill as the applicant’s “current or prior wage, benefits or other compensation.”  However, salary history inquiries do not include inquiries into the objective measure of the applicant’s productivity, for example, through inquiries on revenue, sales, or production reports.  Further, employers may still discuss the applicant’s salary and benefits expectations, including the amount of unvested equity and deferred compensation an applicant would forfeit through resignation from his or her current employment.

The bill contains several other exceptions to the prohibition on salary inquiries, which include the following:

  • Employers can consider and verify an applicant’s salary history if the applicant discloses the information voluntarily and without prompting;
  • Where federal, state, or local law specifically authorizes the disclosure or verification of salary history;
  • Where salary is determined by procedures in a collective bargaining agreement;
  • When current employees are transferred or promoted within the company; and
  • When a background check for non-salary related information inadvertently discloses salary history, provided the employer does not rely on that information in making an offer of employment.

The New York City’s Commission on Human Rights (NYCCHR) will be responsible for investigating complaints and enforcing the new law.  The NYCCHR will also have the authority to impose fines ranging from up to $125 for intentional violations and up to $250,000 for intentional malicious violations.

If Mayor DeBlasio signs this law, employers must immediately update their employment applications and train their recruiters and human resources personnel on the new requirements.  Employers may also be forced to limit the scope of their background checks and revise their notices under the Fair Credit Reporting Act.  For questions on this new proposed law, background check laws, or other employment and hiring requirements, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Key 2017 Legal Changes that Employers and Federal Contractors Must Know About

Ready or not, 2017 is upon us and with it come many regulatory changes and important deadlines for employers and individuals. Make sure your New Year’s resolutions include compliance with the following changes and deadlines pertinent to employers and federal contractors.

Affordable Care Act

Employer Reporting. In November, the IRS extended the deadline for employers to meet their ACA reporting requirements. Employers required to furnish employees with Forms 1095 now have until March 2, 2017 to do so. The deadline to submit the Forms to the IRS remains February 28, 2017 for paper returns or March 31, 2017 for electronically-filed returns.

Marketplace Insurance. The deadline for individuals to obtain marketplace insurance coverage beginning January 1, 2017 expired on December 15, 2016. Individuals who want to enroll in marketplace insurance coverage for the balance of 2017 must do so by January 31, 2017. After the January 31 deadline, individuals may enroll in marketplace coverage only if they qualify for a Special Enrollment Period.

Required Contribution Percentages. For tax years and plan years beginning on and after January 1, 2017, the IRS increased to 9.69% of employee household income the maximum cost of coverage the employer can charge the employee for purposes of the employer mandate penalty. The IRS also increased to 8.16% of the employee’s household income the maximum cost of coverage the employer can charge the employee for purposes of determining whether the employee is eligible for an affordability exemption from the individual mandate.

IRS 2017 Contribution Limits for Retirement Plans and IRAs

The following are the IRS contribution limits for 2017:

  • 401(k) and 403(b) employee contribution limit: $18,000.
  • 401(k) and 403(b) catch-up contribution limit: $6,000.
  • IRA employee contribution limit: $5,500.
  • IRA employee catch-up contribution limit: $1,000.
  • 401(a)(17) compensation limit: $270,000.

Benefit Plan Changes

In May, the HHS Office of Civil Rights issued final rules implementing Section 1557 of ACA. Health programs must comply with these nondiscrimination rules effective January 1, 2017. Additionally, in May, the EEOC issued rules implementing Title I of the ADA and Title II of GINA as they relate to employer wellness programs. Employers must conform their wellness programs with these rules effective January 1, 2017. Plan sponsors that made material modifications to their benefit plans in the past plan year must provide participants with a Summary of Material Modifications within 210 days after the end of the plan year of the modification. For plan years ending on December 31, 2016, the SMM must be provided by July 30, 2017.

New York Minimum Wage and Overtime Salary Exemption Increase

Effective December 31, 2016, the N.Y. minimum wage and salary threshold exemption for time-and-a-half overtime pay increase based on the employer’s size and region as follows:

Minimum Wage Increase

  • New York City: Large Employer (11 or more employees): $11.00 per hour.
  • New York City: Small Employer (10 or fewer employees): $10.50 per hour.
  • Nassau, Suffolk and Westchester Counties: $10.00 per hour.
  • Remainder of New York: $9.70 per hour.

Overtime Salary Exemption Increase

  • New York City: Large Employer (11 or more employees): $825.00 per week.
  • New York City: Small Employer (10 or fewer employees): $787.50 per week.
  • Nassau, Suffolk and Westchester Counties: $750.00 per week.
  • Remainder of New York: $727.50 per week.

New Jersey Minimum Wage Increase

Effective January 1, 2017, the New Jersey minimum wage increases to $8.44 per hour.

EEO-1 Report

During 2017, no federal contractor or subcontractor is required to file an EEO-1 Report with the EEOC or DOL Office of Federal Contract Compliance Programs. The next filing date is March 31, 2018. For the March 31, 2018 filing and all future filings, EEOC and DOL will not accept paper filings. All filings must be done online. Finally, the snapshot pay period for the EEO-1 Report due on March 31, 2018 will be from October 1 to December 31, 2017 instead of July 1 to September 30.

Pay Transparency

Beginning January 1, 2017, pursuant to E.O. 13673 and the DOL Final Rule, a federal contractor or subcontractor must furnish a wage statement to each individual performing work under the federal contract if the individual is subject to the wage requirements of the FLSA, the Davis Bacon Act or the Service Contract Act. The wage statement must be provided each pay period and must include 1) the number of straight time hours worked; 2) the number of overtime hours worked; 3) the rate of pay; 4) gross pay; and 5) itemized additions to or deductions from gross pay. The federal contractor or subcontractor must inform an overtime-exempt individual in writing of the exempt status. For individuals treated as independent contractors, the federal contractor or subcontractor must provide a written notice that the individual is classified as an independent contractor.

Paid Sick Leave

Beginning January 1, 2017, pursuant to E.O. 13706 and the DOL Final Rule, a federal contractor or subcontractor must provide an employee with at least 56 hours per year of paid sick leave or permit an employee to accrue not less than one hour of paid sick leave for every 30 hours worked under a covered federal contract.

If you have any questions or would like to discuss how these changes and dates affect you or your business, please contact Patrick W. McGovern, Esq. at 973-535-7129 or pmcgovern@nullgenovaburns.com, or Nicole L. Leitner, Esq. at 973-387-7897 or nleitner@nullgenovaburns.com.

Transgender Accommodation Issues at the Forefront of Employment and Education

Earlier this month, the Equal Employment Opportunity Commission (EEOC) released a new Fact Sheet, announcing its formal position on bathroom access rights for transgender employees.  The Fact Sheet provides employers with a nuanced look into what practices and procedures the EEOC will be investigating should a charge be brought alleging sex discrimination in the context of bathroom usage by transgendered individuals.

As noted therein, the EEOC defines the term “transgender” as referring to “people whose gender identity and/or expression is different from the sex assigned to them at birth,” and specifically notes that “[a] person does not need to undergo any medical procedure to be considered a transgender man or a transgender woman.”

The EEOC reiterates that it enforces Title VII of the Civil Rights Act of 1964 in instances of discrimination against transgendered individuals, as Title VII prohibits employer discrimination on the basis of sex where the action is “motivated by hostility, by a desire to protect people of a certain gender, by gender stereotypes, or by the desire to accommodate other people’s prejudices or discomfort.” The EEOC also noted that employers cannot and should not rely on state laws contrary to this guidance.

Bathroom Access Rights for Transgender Employees Under Title VII

The EEOC’s interpretation of “transgender” in the context of Title VII and bathroom usage is based upon two cases before the EEOC: Macy v. Dep’t of Justice, EEOC Appeal No. 0120120821, 2012 WL 1435995 (Apr. 12, 2012) and Lusardi v. Dep’t of the Army, EEOC Appeal No. 0120133395, 2015 WL 1607756 (Mar. 27, 2015), as well as a recent opinion from the Fourth Circuit in G.G. ex rel. Grimm v. Gloucester Cty. Sch. Bd., — F.3d –, 2016 WL 1567467 (4th Cir. 2016).

Lusardi held that prohibiting equal access to a common restroom corresponding to the employee’s gender identity is sex discrimination.  Further, in Macy, the EEOC noted that an employer cannot avoid the requirement to provide equal access to a common restroom for transgender employees by providing single-user restroom access instead.  However, the EEOC advised that an employer can make single-user bathrooms available to all employees who might choose to use them. In G.G., the U.S. Court of Appeals for the Fourth Circuit followed the Department of Education’s position that sex discrimination under Title IX is prohibited and that educational institutions are to give transgender students access to bathrooms and locker rooms consistent with their gender identity.

In the Fact Sheet, the EEOC reaffirms its position that any state law to the contrary of these decisions and interpretations is not a defense under Title VII.  Thus, employers would be wise to update their policies and procedures to conform with the EEOC’s directives as to transgendered individuals, rather than look to their resident state for guidance.

Transgender Access to School Bathrooms

On May 13, 2016, President Obama issued a directive that requires every public school to provide appropriate access for transgender students or risk the loss of federal funds. The directive has received strong backlash from conservative leaders who have accused the President of blackmailing and the federal government of getting involved in local issues.

On the same day, the Department of Education and the Department of Justice (“the Departments”) issued a Dear Colleague letter to assist in ensuring that transgender students can “enjoy a supportive and nondiscriminatory school environment.” Although the joint letter does not carry force of law, the intent is clear: schools must agree or lose federal funding.  Specifically, schools must agree that that it will not exclude, separate, deny benefits, or otherwise treat students differently on the basis of sex in its educational programs or activities unless Title IX so authorizes. Schools are required to treat transgender students according to the gender that they identify as soon as a parent or guardian notifies the district that the identity is different from previous records.

Much like the EEOC guidance pertaining to employers, the Departments do not require a medical diagnosis or treatment as a prerequisite to be considered transgender; they also explicitly state that accommodating the discomfort of others cannot be justified by excluding or singling out a particular class of students. The Departments provide specific guidance on sex-segregated activities and facilities and reiterate that schools may provide separate facilities (including housing) but must allow transgender student to access those which align with the gender that which the student identifies. Records must be kept consistent with the gender that which the student identifies with as well. There are some limitations. The Departments note that non-vocational elementary and secondary schools and private undergraduate institutions are permitted under Title IX to set their own sex-based admissions policies.

New York City Commission on Human Rights’ Transgender Guidance

On May 19, 2016, New York City’s Commission on Human Rights (NYCCHR) issued new guidelines requiring employers and landlords to implement transgender pronouns (“ze/hir”) as requested by transgender workers or tenants. Failure to comply may open organizations and individuals up to $250,000 in fines if that failure is motivated by malicious intent.

NYCCHR specifically notes that “harassment motivated by gender is a form of discrimination” and outlines examples of violation of its guidance in the context of failure to use an individual’s preferred name or pronoun, refusing to allow individuals to utilize single-sex facilities and programs consistent with an individual’s preferred gender, sex stereotyping, imposing different uniforms or grooming standards based on sex or gender, providing employee benefits that discriminate based on gender, considering gender when evaluating requests for accommodation, and engaging in discriminatory harassment and retaliation.

For more information regarding the EEOC’s Fact Sheet, related guidelines, and best practices with respect to transgender individuals in the workplace, please contact Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com or 973-533-0777.

NYC To Provide Municipal Employees With Six Weeks of Paid Maternity, Paternity, Adoption And Foster-Care Leave As of January 1, 2016

On December 22, 2015, New York City Mayor Bill de Blasio announced that he will sign an Executive Order granting municipal managers and non-unionized workers up to 6 weeks of paid maternity, paternity, adoption and foster-care leaves.  Starting on January 1, 2016, New York City employees are eligible to take the 6 weeks of paid leave at 100 percent of salary and it can also be combined with accrued sick leave and/or accrued vacation – so that employees will be able to take up to 12 weeks maternity, paternity, adoption, or foster care leave without losing pay.

To cover the $15 million cost, all non-union employees will see their vacation time reduced by two days, from 27 to 25 and the City will be repurposing the existing managerial raise of 0.47 percent scheduled for July 2017. The City’s unionized workers are not covered, unless a deal is reached with their representatives through collective bargaining. The new policy puts New York City at the forefront of city and state policies around the country.  New York City joins Portland, San Francisco and Cincinnati which have also recently approved paid parental leave policies.  In the private sector, companies such as Facebook, Amazon, Apple, Twitter and Netflix have also joined the growing trend to provide workers with paid paternal leave.

For more information regarding how your business can implement paid sick leave, please Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com or 973-533-0777.