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Timestamp: 2019-07-22 16:04:55
Document Index: 120804091

Matched Legal Cases: ['§ 7515', '§ 7515', '§ 7515', '§ 7515', '§ 7515', '§ 7515']

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Labor And Employment Law Blog by Keahn Morris And John Bolesta	- 6d ago
Labor And Employment Law Blog by Jason Guyser	- 1w ago
Labor And Employment Law Blog by Brian Murphy And Myles Moran*	- 1w ago
On June 26, 2019, Southern District of New York Judge Denise Cote granted a motion to compel arbitration of a plaintiff’s sexual harassment claims finding that the New York State prohibition on mandatory arbitration of sexual harassment claims is preempted by the Federal Arbitration Act (“FAA”). As we mentioned in our blog upon this law’s enactment, the United States Supreme Court has routinely held that state laws expressly identifying a category of non-arbitrable state law claims are preempted by the FAA. In Latif v. Morgan Stanley & Co., the Southern District followed the Supreme Court and found the New York ban on mandatory arbitration of sexual harassment claims unenforceable.
New York first enacted its ban on mandatory arbitration of sexual harassment claims in 2018 as part of the 2019 State Budget. The statute amended the New York Civil Practice Law and Rules (“CPLR”) to prohibit contracts requiring the submission of sexual harassment claims to mandatory binding arbitration. In June, New York expanded this prohibition to mandatory arbitration of all harassment claims (see our previous blog).
Plaintiff Mahmoud Latif signed an agreement providing that “statutory discrimination, harassment, and retaliation claims” would be resolved in “final and binding arbitration.” Latif alleges that he was subjected to sexual harassment and was eventually terminated in retaliation for complaining about the alleged harassment. Latif relied on CPLR § 7515 in his opposition to the defendant’s motion to compel arbitration of his sexual harassment claims.
The Supreme Court has routinely held that state laws expressly identifying a category of state law claims as non-arbitrable are preempted by the FAA. Judge Cote applied the analysis laid out by the Supreme Court in AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 341 (2011) (“When state law prohibits outright the arbitration of a particular type of claim, the analysis is straightforward: The conflicting rule is displaced by the FAA.”). Thus, the court held that CPLR § 7515 was “inconsistent with the FAA” because it specifically prohibited arbitration of sexual harassment claims.
Latif argued that CPLR § 7515 was intended to provide general protection for victims of sexual harassment rather than to single out arbitration. However, the court found these arguments “unavailing.” The court rejected the arguments that CPLR § 7515 created a “generally applicable contract defense,” which can be permitted under the FAA, because the plain text of the law singled out arbitration agreements.
The court also rejected Latif’s arguments based on New York’s interest in addressing workplace harassment and thus CPLR § 7515 is a ground in equity for the revocation of a contract. Again, finding that CPLR § 7515 presented no generally applicable contract defense, the court held that the statute was preempted by the FAA.
We expect federal courts to continue to apply the Supreme Court’s FAA jurisprudence consistently. However, we will continue to monitor this case and provide updates if needed.
Labor And Employment Law Blog by Keahn Morris And John Bolesta	- 2w ago
Labor And Employment Law Blog by Keahn Morris And John Bolesta	- 3w ago
Labor And Employment Law Blog by Wesley Shelton	- 3w ago
Labor And Employment Law Blog by Sean Kirby, Danielle Thompson And M..	- 1M ago
On June 19th, the New York State Senate and Assembly voted to pass omnibus legislation greatly strengthening protections against sexual harassment. While the bill, SB 6577, is still waiting for the Governor’s signature, Governor Cuomo supported the legislation and plans to sign the bill when it is sent to his desk. The legislation is the product of two legislative hearings that took place early this year, inspired by a group of former legislative staffers who have said they were victims of harassment while working in Albany, NY. The bill includes several provisions directly affecting private employers. These provisions include:
The New York State Human Rights Law (“NYSHRL”) will expand the definition of an “employer” to include all employers in the State, including the State and its political subdivisions, regardless of size. Additionally, the definition of “private employer” will be amended to include any person, company, corporation, or labor organization except the State or any subdivision or agency thereof.
Protections for certain groups in the workplace will also be expanded. While non-employees, such as independent contractors, vendors, and consultants, were previously protected from sexual harassment in an employer’s workplace, they will now be protected from all forms of unlawful discrimination where the employer knew or should have known the non-employee was subjected to unlawful discrimination in the workplace and failed to take immediate and appropriate corrective action. Similarly, harassment of domestic workers will now be prohibited with respect to all protected classes and will be governed under the harassment standard outlined in (3), below.
The burden of proof for harassment claims will be greatly lowered. Any harassment based on a protected class, or for participating in protected activity, will be unlawful “regardless of whether such harassment would be considered severe or pervasive under precedent applied to harassment claims.” Unlawful harassment will include any activity that “subjects an individual to inferior terms, conditions or privileges of employment because of the individual’s membership in one or more of these protected categories.” Also, employees will no longer need to provide comparator evidence to prove a harassment, and, presumably, discrimination claim.
The law will also alter the affirmative defenses available to employers accused of harassment. The Faragher/Ellerth defense, which allowed employers to avoid liability where the employee did not make a workplace complaint, will no longer be available for harassment claims under NYSHRL. However, an affirmative defense will be available where the harassment complained of “does not rise above the level of what a reasonable victim of discrimination with the same protected characteristic would consider petty slights or trivial inconveniences.”
The statute of limitations to file a sexual harassment complaint with the New York State Division of Human Rights (the “Division”) will be lengthened from one year to three years.
The amendments specify that they are to be construed liberally for remedial purposes, regardless of how federal laws have been construed.
Courts and the Division will be required to award attorneys’ fees to all prevailing claimants or plaintiffs for employment discrimination claims and may award punitive damages in employment discrimination cases against private employers. Attorneys’ fees will only be available to a prevailing respondent or defendant if the claims brought against them were frivolous.
Mandatory arbitration clauses will be prohibited for all discrimination claims.
The use of non-disclosure agreements will be severely restricted. Non-disclosure agreements will be prohibited in any settlement for a claim of discrimination, unless: (1) it’s the complainant’s preference; (2) the agreement is provided in plain English and, if applicable, in the complainant’s primary language; (3) the complainant is given 21 days to consider the agreement; (4) if after 21 days, the complainant still prefers to enter into the agreement, such preference must be memorialized in an agreement signed by all parties; and (5) the complainant must be given seven days after execution of such agreement to revoke the agreement. The same rules apply to non-disclosure agreements within any judgment, stipulation, decree, or agreement of discontinuance. Any term or condition in a non-disclosure agreement is void if it prohibits the complainant from initiating or participating in an agency investigation or disclosing facts necessary to receive public benefits. Non-disclosure clauses in employment agreements are void as to future discrimination claims unless the clause notifies the employee that they are not prohibited from disclosure to law enforcement, the EEOC, the Division, any local commission on human rights, or their attorney. All terms and conditions in a non-disclosure agreement must be provided in writing to all parties, in plain English and, if applicable, the primary language of the complainant.
Employers will be required to provide employees with their sexual harassment policies and sexual harassment training materials, in English and in each employee’s primary language, both at the time of hire and during each annual sexual harassment prevention training. Additionally, the Department of Labor and the Division will evaluate the impact of their model sexual harassment prevention policy and training materials every four years starting in 2022 and will update the model materials as needed.
The majority of these changes will take effect 60 days after the legislation is enacted, with the exception of the “employer” definition expansion, which will take effect after 180 days, and the extended statute of limitations, which will take effect after 1 year. In light of these changes, New York employers should alter their practices and policies to conform with these new requirements. We are monitoring this legislation and will provide updates as new information becomes available.
*Myles Moran, a Sumer Associate in the New York office, assisted with the drafting of this blog.
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