New York State Dramatically Expands Potential Liability for Employer Retaliation Against Whistleblowers
New York, N.Y. (January 13, 2022) - On January 26, 2022, New York’s newly expanded whistleblower protections will go into effect, creating substantial potential liability for employers.
New York’s current whistleblower law, which is codified at Sections 740 and 741 of the Labor Law, provides only narrow whistleblower rights, protecting private-sector employees from retaliation attributable to employee complaints about practices that constitute acts posing “substantial and specific danger to the public health or safety.” While employees are protected against retaliation for complaints about discrimination and harassment under the New York State Human Rights Law and New York City Human Rights Law, and for complaints about unlawful wage and hour issues under New York State Labor Law Section 215, until now New York had strictly limited the ability to seek redress for adverse action taken by employers against employees who complain about other alleged unlawful conduct. That is now changing.
The upcoming change in the New York Labor Law will expand the anti-retaliation provisions to include protections for employees, former employees, and independent contractors who disclose or threaten to disclose, to a supervisor or public body:
- Any conduct that an individual “reasonably believes” to be in violation of any law, rule or regulation, executive order, or any judicial or administrative decision, ruling, or order, involving any level or branch of government, and regardless of whether the reported violation pertains to a matter within the employee’s purview, as well as
- Any activity, policy, or practice the employee “reasonably believes” presents a “substantial and specific danger” to public health or safety.
The amendments to the law also create a carve-out to the previous requirement that the employee (or former employee) must bring the alleged offending conduct or practice to the employer’s attention and provide the employer a reasonable opportunity to cure. Going forward, an employee is only required to make a “good faith effort to notify his or her employer.”
In certain circumstances, the notification requirement is dispensed with entirely and the employee may make a disclosure of the alleged offending conduct directly to a public body. This exception is applicable when there is:
- imminent and serious danger to public health or safety;
- risk to endangering the welfare of a minor;
- reasonable belief that reporting to the supervisor would result in destruction or concealment of evidence;
- reasonable belief that internal reporting will result in physical harm to the employee or other individuals; or
- reasonable belief that the supervisor is already aware of the offending activity, policy, or practice and will not correct the issue.
The amended law also expands the conduct that can be considered to be actionable retaliation. Prior to the amendments, retaliatory action was limited to “discharge, suspension or demotion of an employee, or other adverse employment action taken against an employee in the terms and conditions of employment.” Adverse action now also includes actions that would “adversely impact a former employee’s current or future employment,” including contacting immigration authorities or reporting the immigration status of employees or their family members.
Other notable changes in the amended law are the expansion of the statute of limitations from one to two years and expanded remedies available to the employee. Under the amendments, for claimed violations of the whistleblower law, employees are afforded a private civil right of action, with prevailing plaintiffs entitled to seek the spectrum of remedies including injunctive relief, reinstatement, front and back pay, legal costs, and attorneys’ fees. Civil penalties of up to $10,000 are also available. Notably, however, if a court finds that the employee’s retaliation claim was lodged “without basis in law or in fact,” the employee may face liability to the employer for legal fees and costs.
Lastly, the amendment requires employers to post notice of the whistleblower protections conspicuously.
In light of these upcoming changes to the law, employers should take affirmative steps to analyze and revise policies, postings, and training materials. Given the likely increase in the number of complaints, employers should consider conducting training for their supervisory staff and human resources personnel on how to handle and investigate complaints to best mitigate against the risks of civil action.
Lewis Brisbois’ New York employment law attorneys are available to assist with concerns and compliance issues arising under the Law. For more information, contact the author or editor of this alert. Visit our Labor & Employment Practice page for more alerts in this area.
Bradley Bartolomeo, Partner
Peter T. Shapiro, Partner