As the #MeToo and #TimesUp movements continue to shine a spotlight on sexual harassment and gender equality in the workplace, both New York State and New York City have enacted new laws to strengthen protections against and remedies for sexual harassment in the workplace. On April 12, 2018, New York State Governor Andrew Cuomo signed the state legislation into law (S-7848A), and on May 9, 2018, New York City Mayor Bill DeBlasio signed the city legislation into law (The Stop Sexual Harassment in NYC Act). The dates for implementation of each law differ, as set forth below.

New York State

Effective now:

• Employers will be prohibited from including confidentiality provisions in settlement and severance agreements regarding sexual harassment claims, unless the confidentiality is requested by the complaining employee. The employer must give the employee 21 days to consider whether to sign an agreement containing a confidentiality provision and a seven day period to be able to revoke it.
• Employers will be prohibited from entering into agreements that require workers to arbitrate claims of sexual harassment, unless federal law requires that the claims may be arbitrated.

Effective October 9, 2018:

• Employers must begin providing annual sexual harassment training for all employees, with the first annual training due before October 9, 2019.
• Employers must adopt policies to prohibit sexual harassment that are equal to or stronger than those set forth by the New York State Department of Labor.
• Employers must distribute sexual harassment policy information sheets to employees, including a standard complaint form.

New York City

Effective immediately:

• The New York City Administrative Code’s provisions on sexual harassment apply to all employers, regardless of how many employees they have.
• Employees now have three years within which to file their sexual harassment claims with the New York City Commission on Human Rights, rather than the previous one-year statute of limitations.

Effective September 6, 2018:

• Employers must conspicuously display, in English and Spanish, an anti-sexual harassment poster produced by the New York City Commission on Human Rights informing employees that sexual harassment in breakrooms and common areas is unlawful.

effective April 1, 2019:

• Employers with 15 or more employees must begin providing annual sexual harassment training for all employees, with the first annual training due before April 1, 2020.

As the #MeToo and #TimesUp movements continue to shine a spotlight on sexual harassment and gender equality in the workplace, both New York State and New York City have enacted new laws to strengthen protections against and remedies for sexual harassment in the workplace. On April 12, 2018, New York State Governor Andrew Cuomo signed the state legislation into law (S-7848A), and on May 9, 2018, New York City Mayor Bill DeBlasio signed the city legislation into law (The Stop Sexual Harassment in NYC Act). The dates for implementation of each law differ, as set forth below.

New York State

Effective now:

• Employers may be held liable for their employees’ sexual harassment of non-employees, such as independent contractors, consultants, freelancers, vendors, and others who provide services under a contract in the workplace. This offers new sexual harassment protections to workers in the increasingly prevalent “gig economy,” who are often excluded from laws that protect employees.

Effective July 11, 2018:

• Employers will be prohibited from including confidentiality provisions in settlement and severance agreements regarding sexual harassment claims, unless the confidentiality is requested by the complaining employee. The employer must give the employee 21 days to consider whether to sign an agreement containing a confidentiality provision and a seven day period to be able to revoke it.
• Employers will be prohibited from entering into agreements that require workers to arbitrate claims of sexual harassment, unless federal law requires that the claims may be arbitrated.

Effective October 9, 2018:

• Employers must begin providing annual sexual harassment training for all employees, with the first annual training due before October 9, 2019.
• Employers must adopt policies to prohibit sexual harassment that are equal to or stronger than those set forth by the New York State Department of Labor.
• Employers must distribute sexual harassment policy information sheets to employees, including a standard complaint form.

New York City

Effective immediately:

• The New York City Administrative Code’s provisions on sexual harassment apply to all employers, regardless of how many employees they have.
• Employees now have three years within which to file their sexual harassment claims with the New York City Commission on Human Rights, rather than the previous one-year statute of limitations.

Effective September 6, 2018:

• Employers must conspicuously display, in English and Spanish, an anti-sexual harassment poster produced by the New York City Commission on Human Rights informing employees that sexual harassment in breakrooms and common areas is unlawful.

Effective April 1, 2019:

• Employers with 15 or more employees must begin providing annual sexual harassment training for all employees, with the first annual training due before April 1, 2020.

On February 27, 2018, Bergen County Superior Court Judge Charles Powers held in Abuayasha v. Shapiro Spa LLC t/a The Woodhouse Day Spa, et al., that a non-compete clause that purported to prevent a fired masseuse from working as a masseuse at a nearby spa was unenforceable.

Olga Abuayasha was hired by Woodhouse Day Spa in Red Bank as a masseuse in 2012. At the time she was hired, she signed an agreement that contained a non-compete clause stating that she agreed “not to directly or indirectly compete with the business of [Woodhouse Day Spa] . . . for a period of two years following termination of employment and notwithstanding the cause or reason for termination,” within a five-mile radius of the spa.

On September 27, 2017, Abuayasha was fired by Woodhouse Day Spa for allegedly failing to produce a doctor’s note for a three-day absence from work. Abuayasha alleges she had the note but was not given a chance to produce it. Soon after, Abuayasha was hired by Dr. Sue Massie, whose spa is located within walking distance of Woodhouse Day Spa, and Massie was allegedly heard soliciting Abuayasha’s former clients from Woodhouse. Woodhouse Day Spa sought to enforce the non-compete clause, and Abuayasha filed a complaint to prevent it from being enforced.

Judge Powers ruled that the agreement could only be enforced if it “protects the
“legitimate” interests of the employer, imposes no undue hardship on the employee, and is not injurious to the public,” and that “[a] restraint on the employee is illegal when its purpose is the prevention of competition, except when the methods of competition to be prevented are methods commonly regarded as improper and unfair.”

Powers held that the non-compete clause could not be enforced, because “the only legitimate interest is Defendants’ interest in its client relationships,” which could be protected by a much narrower clause that only sought to prevent Abuayasha from soliticing Woodhouse Day Spa clients, rather than broadly seeking to prevent her from competing within a five mile radius for two years.

Powers also held that Abuayasha’s termination “may constitute an undue hardship,” and thus the non-compete clause should not be enforced. He reasoned that when an employee loses their job due to breach of an employment agreement by the employer, enforcing a non-compete may be an undue burden on the employee. Here, Abuayasha alleged that she was wrongfully terminated in violation of the New Jersey Conscientious Employee Protection Act and the New Jersey Law Against Discrimination, therefore enforcement of the non-compete may be an undue hardship.

Traditionally, non-competes were found in fields like technology or sales, where trade secrets are closely held and specialized skills are often required. But now, non-competes are so common that you might be required to sign one to work as a factory manager, camp counselor, yoga instructor, or even a summer intern.

Just because an employer requires an employee to sign a con-compete agreement, it does not necessarily mean that it is valid and can be used against the employee. In New Jersey, non-compete agreements are viewed unfavorably as restraints of trade.

Did you sign a non-compete when you started with your employer? Have you been asked to sign one after you’ve been working for your employer for some time? Contact this office and we can help you determine whether it affects your ability to get a new job in your field.

On February 27, 2018, Bergen County Superior Court Judge Charles Powers held in Abuayasha v. Shapiro Spa LLC t/a The Woodhouse Day Spa, et al., that a non-compete clause that purported to prevent a fired masseuse from working as a masseuse at a nearby spa was unenforceable.

Olga Abuayasha was hired by Woodhouse Day Spa in Red Bank as a masseuse in 2012. At the time she was hired, she signed an agreement that contained a non-compete clause stating that she agreed “not to directly or indirectly compete with the business of [Woodhouse Day Spa] . . . for a period of two years following termination of employment and notwithstanding the cause or reason for termination,” within a five-mile radius of the spa.

On September 27, 2017, Abuayasha was fired by Woodhouse Day Spa for allegedly failing to produce a doctor’s note for a three-day absence from work. Abuayasha alleges she had the note but was not given a chance to produce it. Soon after, Abuayasha was hired by Dr. Sue Massie, whose spa is located within walking distance of Woodhouse Day Spa, and Massie was allegedly heard soliciting Abuayasha’s former clients from Woodhouse. Woodhouse Day Spa sought to enforce the non-compete clause, and Abuayasha filed a complaint to prevent it from being enforced.

Judge Powers ruled that the agreement could only be enforced if it “protects the
“legitimate” interests of the employer, imposes no undue hardship on the employee, and is not injurious to the public,” and that “[a] restraint on the employee is illegal when its purpose is the prevention of competition, except when the methods of competition to be prevented are methods commonly regarded as improper and unfair.”

Powers held that the non-compete clause could not be enforced, because “the only legitimate interest is Defendants’ interest in its client relationships,” which could be protected by a much narrower clause that only sought to prevent Abuayasha from soliticing Woodhouse Day Spa clients, rather than broadly seeking to prevent her from competing within a five mile radius for two years.

Powers also held that Abuayasha’s termination “may constitute an undue hardship,” and thus the non-compete clause should not be enforced. He reasoned that when an employee loses their job due to breach of an employment agreement by the employer, enforcing a non-compete may be an undue burden on the employee. Here, Abuayasha alleged that she was wrongfully terminated in violation of the New Jersey Conscientious Employee Protection Act and the New Jersey Law Against Discrimination, therefore enforcement of the non-compete may be an undue hardship.

Traditionally, non-competes were found in fields like technology or sales, where trade secrets are closely held and specialized skills are often required. But now, non-competes are so common that you might be required to sign one to work as a factory manager, camp counselor, yoga instructor, or even a summer intern.

Just because an employer requires an employee to sign a con-compete agreement, it does not necessarily mean that it is valid and can be used against the employee. In New Jersey, non-compete agreements are viewed unfavorably as restraints of trade.

Did you sign a non-compete when you started with your employer? Have you been asked to sign one after you’ve been working for your employer for some time? Contact this office and we can help you determine whether it affects your ability to get a new job in your field.

On May 2, 2018, Governor Phil Murphy signed into law a bill enacting new paid sick leave protections for nearly all employees who work in New Jersey. The law, effective on October 29, 2018, requires New Jersey employers to provide employees one hour of paid sick leave for every 30 hours they work, up to a total of 40 paid sick leave hours per year. Employees can use the leave 120 days after it begins to accrue.

The new law covers almost all employees in New Jersey, but some, including construction workers, per-diem hospital workers, and public employees who receive sick leave under another law are not covered. Under the law, employees can use accrued paid leave if they or a family member are sick, for a child’s school conference or other event, or for recovery from domestic violence.

Employers may designate certain dates that cannot be taken off as paid sick leave. Employers may require certain documentation, such as a doctor’s note, for absences of three or more consecutive days.

While many employees in New Jersey already receive paid sick time, it is estimated that 1.2 million employees in the state do not have any paid time off for illness. New Jersey is the 10th state in the country to enact a paid sick leave law.

Governor Murphy said the new law means “something different to everyone.”

“For a child-care worker, it can mean having time to get well so she doesn’t spread her flu to the children in her care,” said Murphy. “For a restaurant worker, it can mean being able to take an hour to meet with his child’s teacher. For others—especially those seeking help from domestic violence—it is time that can quite literally mean the world.”

Posted by Mitchell Schley and Carli Jensen

On May 2, 2018, Governor Phil Murphy signed into law a bill enacting new paid sick leave protections for nearly all employees who work in New Jersey. The law, effective on October 29, 2018, requires New Jersey employers to provide employees one hour of paid sick leave for every 30 hours they work, up to a total of 40 paid sick leave hours per year. Employees can use the leave 120 days after it begins to accrue.

The new law covers almost all employees in New Jersey, but some, including construction workers, per-diem hospital workers, and public employees who receive sick leave under another law are not covered. Under the law, employees can use accrued paid leave if they or a family member are sick, for a child’s school conference or other event, or for recovery from domestic violence.

Employers may designate certain dates that cannot be taken off as paid sick leave. Employers may require certain documentation, such as a doctor’s note, for absences of three or more consecutive days.

While many employees in New Jersey already receive paid sick time, it is estimated that 1.2 million employees in the state do not have any paid time off for illness. New Jersey is the 10th state in the country to enact a paid sick leave law.

Governor Murphy said the new law means “something different to everyone.”

“For a child-care worker, it can mean having time to get well so she doesn’t spread her flu to the children in her care,” said Murphy. “For a restaurant worker, it can mean being able to take an hour to meet with his child’s teacher. For others—especially those seeking help from domestic violence—it is time that can quite literally mean the world.”

On April 9, 2018, the Ninth Circuit Court of Appeals held in Rizo v. Yovino that paying women less than men based on “prior salary alone or in combination with other factors” is a violation of the Equal Pay Act.

The plaintiff, Aileen Rizo worked as math consultant for the Fresno County Office of Education. She discovered in 2012 that she was being paid much less than her male counterparts, despite having more seniority and experience, and brought this case against her employer for pay discrimination later that year.

In 2017, a three-judge panel of the Ninth Circuit held that Rizo’s employer could legally base her pay on her previous salary, relying on the court’s 1982 holding in Kouba v. Allstate Ins. Co., 691 F.2d 873 (9th Cir. 1982), that salary history was a permissible “factor other than sex” upon which employers could base a woman’s salary under the Equal Pay Act. Rizo appealed the 2017 decision, the court heard the case again, this time en banc, and overturned the ruling in Kouba.

Before his death last month, the late Judge Stephen Reinhardt wrote in the majority opinion, “The Equal Pay Act stands for a principle as simple as it is just: men and women should receive equal pay for equal work regardless of sex. The question before us is also simple: can an employer justify a wage differential between male and female employees by relying on prior salary? Based on the text, history, and purpose of the Equal Pay Act, the answer is clear: No.”

“Although the (Equal Pay) Act has prohibited sex-based wage discrimination for more than 50 years, the financial exploitation of working women embodied by the gender pay gap continues to be an embarrassing reality of our economy,” wrote Reinhardt in the decision. According to Pew Research Center, the gender pay gap has decreased somewhat since 1980 but remained about the same since the early 2000s, with women today earning on average about 82% of what men earn.

The defendant’s attorneys said in a statement that they “respectfully disagree with the Ninth Circuit En Banc’s analysis and will petition for review by the United States Supreme Court.”

We will continue to monitor developments in this case.

On March 26, 2018, both houses of the New Jersey Legislature passed the “Diana B. Allen Equal Pay Act,” adding new equal pay protections to the New Jersey Law Against Discrimination (LAD) for all protected classes under the LAD, not just gender.

The new law would make it illegal for an employer to pay a worker, on the basis of a protected characteristic under the LAD, at a lower rate, including benefits, for performing “substantially similar” work. Protected characteristics under the LAD include race, creed, color, national origin, nationality, ancestry, age, marital status, civil union status, domestic partnership status, affectional or sexual orientation, genetic information, pregnancy or breastfeeding, sex, gender identity or expression, and disability.

Under the law, an employer would have to justify a pay disparity by showing legitimate reasons for the difference in pay, such as the use of a seniority or merit system, or another legitimate factor, like experience or education.

This law would be one of the broadest equal pay laws in the nation. New York’s and California’s equal pay laws extend only to race and gender, and Oregon’s extends to gender, race, national origin or color and also on religion, sexual orientation, marital status, veteran status, disability, and age.

The State Senate voted unanimously, 35-0 to pass the bill. The State Assembly voted 74-2 , with Assemblyman Michael Patrick Carroll (R – Morris) and Assemblyman Jay Webber (R – Morris), voting no. Governor Murphy, who recently signed an Executive Order promoting equal pay in state agencies, is expected to sign the bill as soon as it comes to his desk.

In most of the country, businesses can pay their tipped workers—such as servers and bartenders—only $2.13 per hour, so long as the tips the workers make raise their hourly rate to at least $7.25, the federal minimum wage. This is called “tipped minimum wage,” where the employer pays only $2.13 per hour, and uses the employee’s tips as a “tip credit” which makes up the difference. If the worker’s tips don’t make up the difference, the employer is required to pay it.

Some cities and states have higher minimum wages, but still allow employers to take a tip credit. For example, New Jersey’s state minimum wage is $8.60 per hour, and New York State’s minimum wage ranges from $10.40 to $13.00 per hour, depending on where you live within the state. Both states allow employers to take a tip credit. In New York City, the tipped minimum wage for businesses with 11 or more workers is $8.65, and the minimum wage for non-tipped workers is $13.00.

In contrast, some states do not allow employers to take a tip credit. Alaska, California, Washington, Oregon, Nevada, Montana, and Minnesota require all workers, tipped or not, to receive the same minimum wage.

Tipped workers are especially vulnerable to wage theft and harassment, because their bosses can illegally withhold or pocket tips from workers who, for example, don’t accept sexual advances, threaten to report harassment, don’t know that their bosses are not allowed to take a portion of their tips, or simply because the bosses secretly take a portion of the tips and the workers are unaware.

Further, because tips make up such a large proportion of of these workers’ income, it can be hard for them to anticipate their monthly income, leave them subject to harassment from customers, and to lose tip income from customers tip less–or not at all–due to racial, religious, gender, or sexual orientation bias against the employee.

New York Governor Andrew Cuomo is now considering whether to eliminate this problem for workers in New York State by raising the minimum wage for tipped workers to the same level as all other workers, and has scheduled public hearings around the state to for input on whether minimum wage tip credits should be ended in New York.

Those in the restaurant and other tipped industries argue eliminating the tip credit would harm small businesses, force employers to cut jobs, and decrease workers’ income because customers would tip less. Although, according to the Economic Policy Institute, workers in states that have eliminated the tipped minimum wage earn more money and are less likely to fall below the poverty line than those in states which allow the tipped minimum wage.

We will continue to monitor this as it develops.

On January 16, 2018, Governor Phil Murphy’s first official act as Governor was to sign Executive Order No. 1, promoting equal pay for women. The Order bars managers in state government from asking job applicants about their salary history, because “asking job applicants about their salary histories inappropriately perpetuates the wage gap by allowing prospective employers to offer lower salaries to women than they otherwise would . . .”

The Order states that “studies have demonstrated that women in New Jersey who hold full-time, year-round jobs are paid 82 cents for every dollar paid to men holding full-time, year-round jobs,” that this pay gap “has been demonstrated to exist across all industries and among workers with all levels of education,” and that the gap is even larger for Black and Latina women.

Governor Murphy said that he “would make it state law” if the New Jersey legislature sent a bill to his desk that extended these provisions to private employers. State lawmakers, including Senate Majority Leader Loretta Weinberg (D-Bergen), Assembly Speaker Craig Couglin (D-Middlesex), and Senate President Stephen Sweeney (D-Gloucester) joined Murphy for the signing to support equal pay in New Jersey.

“The reality is it is something that women face each and every day,” said Coughlin. “It’s painfully unfair and it’s something that we have to change. When you ask for someone’s salary you perpetuate the problem.”