On July 10, 2019, Governor Cuomo signed into law two new bills amending New York’s labor and employment requirements. These two new laws will affect all New York employers statewide. They are a continuing trend and an expansion on the RISE Act (see The RISE Act: Suffolk County Bans Inquiring About Salary History), which banned inquiries into salary history throughout Suffolk County effective as of June 2019, as well as a similar ban passed in New York City in 2017.

The first new law amends the equal pay provisions of the New York Labor Law to include all protected classes under the New York State Human Rights Law.[1] Currently, this law applies only to equal pay regardless of sex. Employees who fall within these expanded protected classes are now entitled by law to receive equal pay to colleagues who do not fall within these categories for doing the same or substantially similar work. The standard has also been relaxed from “equal to” to “substantially similar to.” The law does not alter existing exceptions to the Labor Law which allow for differences in pay based on a seniority system, merit system, production-based system or a bona fide reason such as education, training or experience which is job-related and consistent with business necessity. This amended law is scheduled to take effect as of October 8, 2019.

The second new law amends the New York Labor Law by prohibiting employers from requesting, inquiring, and/or relying on a job applicant’s or employee’s salary and wage history as a factor when determining whether to hire the candidate or what salary to offer them. The law further prohibits an employer from: using an employee’s or job applicant’s salary history (current or former) for any other reason; refusing to hire or promote an employee who does not provide their salary history; or otherwise retaliating against an applicant or employee based upon their salary history or their refusal to provide such information. Employers can consider current employee salaries in hiring decisions, such as promotions.

Applicants or current employees are not prohibited from voluntarily disclosing their salary history, including for purposes of negotiating compensation, and employers are permitted, after hiring or promoting an applicant, to obtain confirmation of that person’s salary history to confirm the truthfulness of the past salary and wage claimed.

Nor does the law supersede any currently existing federal, state, or local law which requires the disclosure or verification of an employee’s salary history for employment or compensation purposes. This amended law is scheduled to take effect as of January 6, 2020.

What should employers be ready for with these new laws? New York employers should expect an increase in claims brought to court under the new amended Equal Pay Law, as it has lowered the standard for plaintiffs to prove their case. Furthermore, the expanded protected classes under which an individual can claim discrimination under the Equal Pay Law, as well as a statute of limitations which is six years long, means that employers may expect an increase in claims and should be aware of the greater potential damages any failure to properly comply with the law would bring.   

What should employers do to prepare? Given the new federal reporting requirements and to enable employers to potentially avoid costly litigation, all New York employers should consider conducting pay audits and should take the opportunity to review their company’s job application procedures and forms to remove references to salary history, as well as train personnel to avoid any salary history inquiries. Please contact our office with any questions you may have, as well as to discuss your specific business situation.

[1] Protected classes also include but are not limited to age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, disability, and domestic violence-victim status.