August 19, 2014

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August 18, 2014

New York City Prohibits Discrimination Against Unemployed

The "unemployed" are now a protected class in New York City, with the rights and protections associated with that classification.

On March 13, the New York City Council approved an amendment to the New York City Administrative Code to make it unlawful to discriminate against job applicants based on their unemployment status. The amendment, which takes effect on June 11, 2013, is aimed at addressing concerns that unemployed individuals are being increasingly discriminated against. The City Council's near-unanimous vote (43–4) to approve the amendment overrides New York City Mayor Michael Bloomberg's February 22, 2013, veto and will make it unlawful for an employer, employment agency, or agent thereof to (1) base an employment decision concerning hiring, compensation, or terms, conditions, or privileges of employment on an applicant's unemployment or (2) advertise for a job vacancy with provisions stating that being currently employed is a requirement or qualification for the position or that the employer will not consider unemployed individuals.[1] As a result, the "unemployed" in New York City will now be a protected class, with the rights and protections associated with that classification.

Background

As initially introduced to the City Council on March 28, 2012, the amendment made it an unlawful discriminatory practice for employers to base (1) employment decisions, including those related to termination, promotion, demotion, and discipline; (2) hiring; (3) compensation; and (4) terms, conditions, and privileges of employment on the unemployment status of applicants and employees. It also defined "unemployment status" to mean an individual's current or recent unemployment.

Revised Amendment

Following hearings in June 2012, however, the amendment was revised to address concerns raised by the Bloomberg administration and to clarify ambiguities about the rights and obligations of employers and job applicants. For instance, the prohibitions were narrowed to apply only to employment decisions related to hiring, compensation, or terms, conditions, or privileges of employment.[2] In addition, the City Council eliminated "recent unemployment" from the definition of "unemployment status" and instead defined "unemployed" and "unemployment" as "not having a job, being available to work, and seeking employment."[3]

The revised amendment also clarifies what actions an employer[4] can take with respect to an applicant's unemployment when making employment decisions. Specifically, employers may do the following:

  • Consider an applicant's unemployment where there is a "substantially job-related reason" for doing so or question the applicant about the circumstances surrounding the applicant's separation from his or her prior employment.[5]

  • Consider a "substantially job-related qualification"—including whether an applicant has a current and valid occupational or professional license or certificate, registration, permit, or other credential and the applicant's minimum level of education or training or professional, occupational, or field experience—when making an employment decision.[6]

  • Determine that only current employees of the employer who apply for the position will be considered for employment, given priority for employment, or given priority with respect to compensation or terms, conditions, or privileges of employment.[7]

  • Set compensation or terms or conditions of employment for a person based on that person's actual amount of experience.[8]

The revised amendment also clarifies the limitations on job advertisements employers can use for job vacancies in New York City. Specifically, employers are prohibited from using any advertisement that contains a provision stating or indicating that (1) current employment is a requirement or qualification for the job or (2) an employer will not consider individuals for employment based on their unemployment.[9] An employer may, however, utilize an advertisement that contains a provision setting forth substantially job-related qualifications—including licensing, registration, or permit requirements; minimum levels of education; or training or professional, occupational, or field experience.[10]

In addition to the prohibitions discussed above, the revised amendment also provides that the New York City Commission on Human Rights (Commission) or an individual may bring an unlawful discriminatory practice claim based on a disparate impact theory.[11] To do so, the Commission or individual must either (1) demonstrate that a policy or practice, or a group of policies or practices,[12] of an employer results in a disparate impact to the detriment of those protected by the amendment or (2) produce substantial evidence that an alternative policy or practice with less disparate impact is available.[13] The employer must then plead and prove as an affirmative defense that (1) its policy or practice has a substantially job-related qualification as its basis or that it does not contribute to the disparate impact or (2) the proposed, alternative policy or practice would not serve the employer as well.[14]

Implications

Under the amendment, an individual's unemployment status will be provided similar protections under the New York City Administrative Code to that of his or her age, race, creed, color, national origin, gender, disability, marital status, partnership status, sexual orientation, or alienage or citizenship status. Accordingly, employers face a potential increase in discrimination claims challenging their hiring process. In preparation, employers should take the appropriate steps now to ensure that their hiring practices and policies will comply with the new law when it goes into effective on June 11, 2013. All employees and agents involved in the hiring process should be educated on what they can and cannot do with respect to unemployed applicants. Employers should revise their hiring guidelines to ensure that any common inquiries or hiring factors are tailored to avoid any implication that an individual's unemployment status is a consideration in the hiring process. Similarly, employers should modify any advertisements or job postings to remove any reference to an applicant's employment status.


[1]. N.Y.C. Admin. Code §§ 8-107 (21)(a)(1)–(2) (effective Jun. 11, 2013).

[2]. N.Y.C. Admin. Code § 8-102 (5).

[3]. N.Y.C. Admin. Code § 8-102 (27).

[4]. With respect to Administrative Code section (21)(a)(1) (i.e., the employment decision provision), the revised amendment excludes employers with fewer than four persons in their employ from coverage. However, the advertisement provision, N.Y.C. Admin. Code § (21)(a)(2), applies to all employers regardless of the number of persons in their employ.

[5]. N.Y.C. Admin. Code § 8-107 (21)(b)(1).

[6]. N.Y.C. Admin. Code 8-107 §§ (21)(b)(2), (e).

[7]. N.Y.C. Admin. Code § 8-107 (21)(b)(4).

[8]. Id.

[9]. N.Y.C. Admin. Code § 8-107 (21)(a)(2).

[10]. N.Y.C. Admin. Code § 8-107(b)(3).

[11]. N.Y.C. Admin. Code § 8-107 (21)(e).

[12]. To the extent the Commission or an individual establishes that a group of policies or practices results in a disparate impact, they are not required to identify the specific policy or practice within the group that causes the disparate impact. Id.

[13]. Id.

[14]. Id.

Copyright © 2014 by Morgan, Lewis & Bockius LLP. All Rights Reserved.

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About this Author

Partner

David A. McManus is a partner in Morgan Lewis's Labor and Employment Practice and is the practice group leader for the Labor and Employment Practice in New York. Mr. McManus counsels and represents employers in a wide array of industries in labor and employment law matters, arising under federal, state, and local statutes, including Title VII, ADEA, ADA, FLSA, and the FMLA. He regularly represents employers in employment disputes litigated in federal and state courts, as well as various arbitral forums.

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Ira G. Rosenstein, Morgan Lewis Law Firm, Employment Law Attorney
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Ira G. Rosenstein is a partner in Morgan Lewis's Labor and Employment Practice and co-chair of the Individual Employment Litigation and Arbitration subpractice. Mr. Rosenstein represents both large and small employers in traditional employment disputes involving claims of discrimination, wrongful discharge, violation of federal and state wage and hour laws, and Sarbanes-Oxley whistleblower claims. Mr. Rosenstein is particularly known for his longtime representation of clients within the financial services industry, and is nationally known for his experience trying cases before FINRA (...

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