Publications

Earlier this year, both New York City and New York State enacted significant legislation to address the issue of sexual harassment in the workplace. Specifically, on April 12, 2018, New York Governor Andrew Cuomo signed the Budget Bill (“Budget Bill”), which included an omnibus anti-sexual harassment legislative package. Similarly, on April 11, 2018, the New York City Council passed the “Stop Sexual Harassment in NYC Act” (“NYC Act”), a package of bills that imposes new requirements for employers aimed at combating sexual harassment, which was signed into law by Mayor Bill de Blasio on May 9, 2018. Notably, both the New York State and City legislation will require (among other things) employers – including staffing firms and direct hire firms (recruiting firms) – to conduct annual sexual harassment prevention trainings for their employees. New York State’s training requirement goes into effect October 9, 2018, and the City’s training requirement takes effect April 1, 2019.

Staffing and direct hire firms have been patiently waiting since the passing of this legislation for further guidance and clarification. Recently, both New York State and New York City have made publicly available certain materials that will help staffing and direct hire firms and other employers comply with their obligations under these new laws. As set forth in greater detail below, New York State has issued proposed guidance regarding its legislation’s training and written policy requirements, and the New York City Commission on Human Rights (the “Commission”) has recently made available certain notices that must be displayed in the workplace and provided to employees under the NYC Act. What follows is an overview of noteworthy provisions from these two legislative packages and the recent guidance and materials issued by New York State and the City as well as the legislation’s potential impact on the staffing industry.

New York State Budget Bill

Overview

Effective April 12, 2018, the Budget Bill expanded protections against workplace sexual harassment under the New York State Human Rights Law to “non-employees,” including contractors, subcontractors, vendors, consultants, and anyone else providing services pursuant to a contract. Accordingly, temporary employees working on assignment are now expressly statutorily protected against harassment by a staffing firm client^[1], and, moreover, staffing firms will need to ensure its temporary employees do not engage in unlawful conduct against its clients’ employees.

As of July 11, 2018, New York State law prohibited all employers in the State (whether or not in New York City) from using confidentiality or nondisclosure clauses in settlements or agreements relating to claims of sexual harassment, unless the complainant expresses a preference for confidentiality^[2], and from enforcing mandatory arbitration clauses when dealing with claims of workplace sexual harassment.^[3]

Beginning October 9, 2018, the Budget Bill requires employers to conduct annual sexual harassment prevention training for their employees and to distribute an anti-harassment policy to employees. The training and policy requirements apply to all New York State staffing and direct hire firms regardless of the number of employees and regardless of whether or not they have employees or an office in New York City.

Starting on January 1, 2019, employers that submit bids for state contracts will be required to include language in their bid affirming that they have implemented a written anti-harassment policy and that they provide annual anti-sexual harassment training.

Recent Guidance

The State of New York has just recently published a number of materials regarding its new sexual harassment laws, including a model written sexual harassment policy, a model internal complaint form, minimum standards for sexual harassment prevention policies, a model sexual harassment prevention training, minimum standards for sexual harassment prevention training, and Combating Sexual Harassment: Frequently Asked Questions. Notably, these materials are in “draft” form, and the State is welcoming comments on these materials and guidance from the public (employers, employees, and others) through September 12, 2018. Accordingly, the substance of these materials could very well change after the comment period.

Model Training

In its current form, the model sexual harassment prevention training materials clarify that the training must be “interactive” and include some level of participation by the employees being trained – but this does not necessarily mean that the training must be live or conducted in-person. According to the proposed New York State guidance, trainings should include as many of the following elements as possible: (i) be web-based, with questions asked of employees as part of the program; (ii) accommodate questions asked by employees; (iii) include a live trainer made available during the session to answer questions; and (iv) require feedback from employees about the training and the materials presented. While the guidance states that trainings should include as many of the foregoing as possible, it does not expressly require that all of such elements be incorporated. Moreover, the guidance provides that employers should provide employees with training in the language that is spoken by their employees.

The current materials also provide for a number of available training elements, including a script for in-person group training, a PowerPoint to accompany the script, a video presentation, and FAQs. At minimum, the training must meet the current “Minimum Standards for Sexual Harassment Prevention Training,” which means the training must:

1. be interactive;
2. include an explanation of sexual harassment consistent with guidance issued by the New York Department of Labor in consultation with the New York State Division of Human Rights;
3. include examples of conduct that would constitute unlawful sexual harassment;
4. include information concerning the federal and state statutory provisions concerning sexual harassment and remedies available to victims of sexual harassment;
5. include information concerning employees’ rights of redress and all available forums for adjudicating complaints; and
6. include information addressing conduct by supervisors and any additional responsibilities for such supervisors.

Currently, New York State has mandated that employees receive their first training by January 1, 2019, and thereafter all employees must complete an additional training at least once per year, which may be based on the calendar year, anniversary of each employee’s start date, or any other date the employer chooses. Moreover, the proposed guidance provides that all employees (including temporary employees) must be trained within 30 calendar days of starting their job.

Accordingly, while New York State has not specifically addressed how these requirements will apply to the staffing industry, it seems clear that all employees, including temporary employees, must be trained annually, and all current temporary employees (as well as internal and permanent employees) will need to receive their first training by January 1, 2019.

It is unclear, however, whether those temporary employees in a staffing firm’s candidate pool who have not performed any work must be trained. Since the proposed FAQs provide that all employees must complete sexual harassment training within 30 calendar days of “starting their job,” we believe only employees on assignment must be trained within 30 days after their first day of work on their first assignment through the staffing firm. In other words, based on the current proposed guidance, we believe candidates merely in a pool who have not performed any work would not need to be trained (until they are placed on assignment).

Further, we believe that temporary employees who have not worked on a client assignment in a new training year need not be trained unless and until they are placed on assignment in such new year. For example, if a temporary employee was on assignment and trained in October 2018 but does not work perform any work in 2019, then such employee would not have to receive a training for that year. This is one of many issues on which the New York Staffing Association intends to seek clarity.

Another unanswered question is whether employees must be paid for time spent completing the trainings. Without further guidance from New York State, we believe employees should be paid for the trainings as they are satisfying requirements of their job imposed by their employer (even if such requirement is mandated by law).^[4] This begs another question – what wage must employees receive for the training? Subject to satisfaction of employer obligations under the New York Wage Theft Prevention Act and other payment and legal requirements, staffing and direct hire firms may be able to pay their employees an alternate wage (e.g., minimum wage) for completion of the training requirements.

It is also unclear what ramifications an employee may face for failing to complete the training despite the employer’s best efforts to make it available. The proposed FAQs provide that employers are required to ensure that all employees receive training on an annual basis and may take “appropriate administrative remedies” to ensure compliance. If the employee is employed on an at-will basis and fails to complete the training for inexplicable reasons despite the employer’s directives, the employer can likely discipline the employee (including terminate the employee).

Remember, however, these requirements are part of the proposed guidance, and thus there is the potential for change following the comment period.

Model Policy

New York State has also issued a model sexual harassment prevention policy to comply with the requirement that a written policy, inclusive of certain specific information, be provided to employees, which may be included in an employee handbook or distributed electronically, provided that employees are able to access the policy on a computer provided by the employer during work time and be able to print a copy of the policy for their records. The current FAQ guidance states that employers are not required to obtain a signed acknowledgment of the policy from employees, but it is encouraged. Moreover, the policy must be provided in the language that is spoken by the employee.

Staffing and direct hire firms that do not utilize New York State’s model policy must ensure that their policy at least meets or exceeds the following minimum standards – the policy must:

1. prohibit sexual harassment consistent with guidance issued by the New York Department of Labor in consultation with the New York State Division of Human Rights;
2. provide examples of prohibited conduct that would constitute unlawful sexual harassment;
3. include information concerning the federal and state statutory provisions concerning sexual harassment, remedies available to victims of sexual harassment, and a statement that there may be applicable local laws;
4. include a complaint form;
5. include a procedure for the timely and confidential investigation of complaints that ensures due process for all parties;
6. inform employees of their rights of redress and all available forums for adjudicating sexual harassment complaints administratively and judicially;
7. clearly state that sexual harassment is considered a form of employee misconduct and that sanctions will be enforced against individuals engaging in sexual harassment and against supervisory and managerial personnel who knowingly allow such behavior to continue; and
8. clearly state that retaliation against individuals who complain of sexual harassment or who testify or assist in any investigation or proceeding involving sexual harassment is unlawful.

Stop Sexual Harassment in NYC Act

Training Requirements

As of April 1, 2019, the NYC Act requires staffing and direct hire firms and other employers with 15 or more New York City employees to conduct annual anti-sexual harassment training for their employees. However, it is important to note the New York State requirement of annual anti-harassment training referred to above covers all employers regardless of the number of employees. Specifically, training under the NYC Act^[5] must include the following:

1. an explanation of sexual harassment as a form of unlawful discrimination under local law;
2. a statement that sexual harassment is also a form of unlawful discrimination under state and federal law;
3. a description of what sexual harassment is, using examples;
4. any internal complaint process available to employees through their employer to address sexual harassment claims;
5. the complaint process available through the Commission, the New York State Division of Human Rights and the U.S. Equal Employment Opportunity Commission, including contact information;
6. the prohibition of retaliation including examples;
7. information concerning bystander intervention, including but not limited to any resources that explain how to engage in bystander intervention; and
8. the specific responsibilities of supervisory and managerial employees in the prevention of sexual harassment and retaliation, and measures that such employees may take to appropriately address sexual harassment complaints.

Employers must keep a record of all trainings, including a signed employee acknowledgement of completed training, which may be electronic. Employers must maintain such records for at least three years and such records must be made available to the Commission for inspection upon request.

Pursuant to the NYC Act, the Commission will develop an online interactive training module that may be used by employers to satisfy the training requirements above, which will allow for the electronic provision of certification each time any such module is accessed and completed. We anticipate that such training module will provide greater clarity and guidance on the required contents of the training.

Like the State law, training under the NYC Act must be interactive – the NYC Act specifically provides that the training is not required to be live or facilitated by an in-person instructor to satisfy the “interactive” requirement. All existing employees, including supervisory and managerial employees, must be trained. Such training shall be required after 90 days of initial hire for all employees who work more than 80 hours in New York City in a calendar year, regardless of whether they are full time or part time.

Accordingly, under the NYC Act, there is a 90-day waiting period from the date of hire before an employer must train an employee. With respect to the staffing industry, however, it is unclear whether “initial hire” refers to the date the employee is placed in the candidate pool or the date the employee first performs work on assignment. Nevertheless, New York City employers will still need to comply with the currently proposed New York State guidance and provide training within 30 days of starting the job, which could render this requirement meaningless.

Posting and Notice Requirements

Beginning September 6, 2018, staffing and direct hire firms and other New York City employers will be required to conspicuously display in the workplace a poster published by the Commission setting forth employees’ rights and employers’ responsibilities under the NYC Act. Employee breakrooms and other common areas where employees gather are ideal locations for the poster, which must be at least 8.5 by 14 inches with a minimum 12 point type. The poster must be displayed in both English and Spanish. Without further guidance from the Commission on this requirement, we recommend that staffing firms provide their temporary employees with this poster (along with other notices and onboarding documents) since temporary employees do not regularly report to the staffing firm’s workplace.

The NYC Act also requires that employers provide individual employees with a factsheet regarding the NYC Act at the time of hire, which may be included in an employee handbook.

Other Provisions

The NYC Act expanded the definition of “employer” under the New York City Human Rights Law to cover employers with less than four employees with respect to gender based harassment claims, and increased the time within which aggrieved individuals must file a complaint of gender based harassment with the Commission from one year to three years.

In light of these enactments and proposals, staffing and direct hire firms should begin preparing to come into compliance with the sexual harassment prevention training and policy requirements and be on the lookout for finalized New York State guidance and materials following the comment period, which ends on September 12, 2018. In addition, staffing and direct hire firms should think about and discuss with employment counsel efficient ways to implement sexual harassment prevention trainings that address both New York State and New York City requirements in one all-encompassing training program.

Staffing and direct hire firms that are also covered by the NYC Act should monitor the Commission’s website for updates to the poster and factsheet and for guidance on compliant training programs, and should be sure to contact employment counsel with questions and issues regarding the NYC Act and its interaction with New York State requirements.

Once the New York State guidance and materials are finalized, we will provide further information regarding uniform compliance with both New York State and City obligations.

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^[1] The authors believe this merely codifies existing law.

^[2] Recent changes in federal tax law make the deductibility of settlement payments for such claims where the settlement agreement contains a confidentiality clause questionable at best.

^[3] The authors are skeptical as to the enforceability of the prohibition on mandatory arbitration clauses for claims of workplace sexual harassment as it will likely be preempted by the Federal Arbitration Act.

^[4] Clearly exempt employees need not be paid additional wages for completing the training, and, subject to overtime and minimum wage requirements, the same should be true for salaried employees.

^[5] Assuming the NYS guidance and materials are adopted, NYC-based firms will need to review their training program to ensure it complies with both the NYS and NYC requirements, albeit it can be one training regimen.

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For more information on the topic discussed, contact:

• Joel A. Klarreich  |  jak@thsh.com  |  212-508-6747
• Jason B. Klimpl  |  klimpl@thsh.com  |  212-508-7529
• Andrew P. Yacyshyn  |  yacyshyn@thsh.com  |  212-508-6792