Effective June 11, 2013, New York City employers with at least four employees (as well as employment agencies) are prohibited by law from discriminating against individuals based on their employment status. Thus, covered employers may not make employment decisions (including those regarding hiring and compensation, or the terms, conditions or privileges of employment) on the basis of an applicant’s employment status. Nor may covered employers state in job advertisements that only those who are currently employed may apply, or that unemployed applicants will not be considered.

This latest expansion of the New York City Human Rights Law (NYCHRL) adds “unemployment” to the growing list of personal characteristics that are protected by the law (the list already includes personal characteristics such as race, sex, age, disability and sexual orientation). “Unemployment” is defined by the NYCHRL as “not having a job, being available for work, and seeking employment.”

Several other jurisdictions have enacted similar laws. New Jersey started the trend, passing a law in 2011 that bars employers from stating in advertisements that they will only hire currently employed individuals. Oregon and the District of Columbia have followed suit, and other states (including California, Maryland and Arizona) have considered such laws but have not yet passed them. Similar federal legislation was introduced in 2011 but has not yet been voted on.

The NYCHRL’s prohibition on discrimination against the unemployed has been described as the toughest such law in the nation, in large part because it is the first such law to allow individuals to sue for discrimination based on their employment status. Successful plaintiffs may recover damages, including punitive damages, attorneys’ fees and injunctive relief. In addition, plaintiffs may establish a violation of the law under either a disparate-treatment or a disparate-impact theory.

The NYCHRL does permit employers to consider an applicant’s employment status “where there is a substantially job-related reason for doing so.” Employers are also expressly permitted to inquire “into the circumstances surrounding an applicant’s separation from prior employment.” Additionally, employers are allowed to accept applications only from those whom they already employ and to give hiring preference to those whom they already employ.

To comply with this latest amendment to the NYCHRL, employers should ensure that their job advertisements and postings do not exclude the unemployed from applying, and employers should also ensure that hiring managers and human resources staff do not screen out applicants because they are unemployed, or otherwise discriminate against the unemployed in the hiring process.