New York State has implemented several changes to the State’s labor laws recently. Much of the new legislation is already in effect, with more becoming effective in the upcoming months. The changes highlight Governor Kathy Hochul’s administration’s focus on enhancing worker protections and ensuring fair and equitable workplaces. As an employer in New York, here’s what you need to know.

New Laws Now In Effect

NY Pay Transparency Act (N.Y. Labor Law § 194-b)

The NY Pay Transparency Act, N.Y. Labor Law § 194-b, went into effect on September 17, 2023. Now, New York State employers with four or more employees, and employment agencies,^[1] must include a salary or salary range in their job postings for any job, promotion, or transfer opportunity and disclose the job description for the position, if one exists. The law also requires that employers clearly state if a position is commission-based. The law applies to all jobs to be performed, at least in part, in the state of New York, and to jobs that will physically be performed outside of New York, but report to a supervisor, office, or other work site in New York (i.e., remote work). Although this covers both internal and external job postings, employers are not prohibited from hiring, promoting, or transferring employees without posting an advertisement. The law also prohibits employers from retaliating against employees who discuss their compensation with coworkers. The New York Department of Labor (“DOL”) has a helpful Fact Sheet for Employers explaining the new requirements. The DOL has also published regulations to accompany this law, published on September 13, 2023, with public comments due by November 13, 2023.

As the NY Pay Transparency Act is now in effect, it is a good idea for all employers to review their job postings and make sure they comply.

Invention Assignment Provisions in Employment Agreements (N.Y. Labor Law § 203-f)

Governor Hochul signed New York State Assembly Bill A.5295 into law on September 15, 2023, effective immediately. See A.5295. This law adds a new section 203-f to the N.Y. Labor Law, which provides that employment agreement provisions that require an assignment of employee inventions do not apply to inventions that employees developed entirely on their own time without using the employer’s equipment, supplies, facilities or trade secret information. There are two exceptions, for inventions that either “(a) relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or (b) result from any work performed by the employee for the employer.” Any existing provisions in employment agreements that conflict with this law are now unenforceable as against the public policy of the State.

We recommend reviewing your employment agreement provisions to make sure they comply with this law.

Mandatory Meetings Concerning Employer’s Views Prohibited (N.Y. Labor Law § 201-d)

On September 6, 2023, Governor Hochul signed New York State Senate Bill S.4982, which became effective immediately. See S.4982. The law amends N.Y. Labor Law § 201-d to prohibit employers from discriminating against employees for their refusal to attend employer-sponsored meetings, or listen to a speech or view communications, where the primary purpose is to communicate the employer’s opinion concerning political or religious matters. The law does not apply to an employer’s “managerial or supervisory employees,” or to non-mandatory casual conversations in the workplace. The law requires employers to post a sign or notice in the workplace informing employees of their rights pursuant to the law.

We expect the DOL to publish a form of notice for employers to use.

Larceny Amended to Include Wage Theft (N.Y. Penal §§ 155.00, 155.05)

Effective immediately, the New York Penal Code now includes “wage theft” in its definition of larceny. See S.2832-A. Larceny is any “wrongful taking, obtaining or withholding of another’s property,” with the intent to deprive another of property or to appropriate the same to himself or to a third person. See N.Y. Penal § 155.05. Larceny by wage theft occurs when a person “hires a person to perform services and the person performs such services and the person does not pay wages, at the minimum wage rate and overtime, or promised wage, if greater than the minimum wage rate and overtime, to said person for work performed.” The prosecution is allowed to aggregate nonpayments or underpayments from “a workforce” (defined as a group of one or more persons who work in exchange for wages) into one larceny count even if such nonpayments or underpayments occurred in multiple counties.

This penal code provision is focused on intentional, not accidental, non-payment. Still, the amendment underscores how important it is that employers ensure their employees are properly paid, by sending a clear message from the State that wage and hour law violations will not be tolerated.

Laws that Take Effect in the Upcoming Months

Unemployment Insurance Notification (N.Y. Labor Law § 590(2)

On September 14, 2023, Governor Hochul signed legislation which related to employers providing notice to their employees of eligibility for unemployment benefits. See S.4878-A/A.398-A. The law, which requires that employers give written notice to their employees that they are eligible for unemployment insurance whenever the employer makes a permanent or temporary separation of the employee or reduces hours to a point that the employee qualifies for total or partial unemployment, takes effect on November 13, 2023. The information must be disclosed on a form to be furnished or approved by the DOL.

Employee Personal Account Information (N.Y. Labor Law § 201-i)

Starting March 12, 2024, New York employers are prohibited from requesting or requiring employees or applicants to disclose any username, password or other means to access their personal accounts, such as social media accounts. See S.2518/A.836. A “personal account” is any “an account or profile on an electronic medium where users may create, share, and view user-generated content,” which is used by the employee or applicant exclusively for personal purposes. The law also prohibits New York employers from discharging, disciplining, or otherwise penalizing any employee who refuses to disclose that information, or threatening to do so; and from refusing to hire an application on that basis. Other state such as Rhode Island and Connecticut have had similar protections in place for years.

There are several limitations and exceptions to this law. For example, employers may still require that their employees disclose access information for non-personal accounts that provide access to the employer’s internal computer or information systems, and for accounts that are used for business purposes. Employers are allowed to view, access, and rely on information about employees or applicant that can be obtained from the public domain. Employers can also access employee photographs, video, messages, or other information in connection with reports of misconduct or investigating misconduct, if that information was voluntarily shared by an employee, client, or other third party, who the employee subject to such report or investigation voluntarily gave access to it.

We encourage all New York employers to review your employee handbooks and policies to ensure your policies comply with these new changes in the law. If you have questions or are concerned about your practices with regard to social media accounts, please reach out for guidance.

Increase Threshold for Applicability of Certain Provisions Related to Payment of Wages (N.Y. Labor Law §§ 190(7), 192(2), 198-c)

Effective March 13, 2024, the threshold for certain protections under the Labor Law provided to employees employed in a bona fide executive, administrative, or professional capacity will increase from employees making $900 per week to $1300 per week. See S.5572. Once in effect, an employer cannot directly pay or deposit a covered employee’s net wage or salary in a bank or other financial institution without the employee’s advance written consent, if the employee earns under the new $1,300 threshold. See N.Y. Labor Law § 192(2). The threshold also matters for when failure to pay or provide benefits or wage supplements that are required under an agreement becomes a misdemeanor under N.Y. Labor Law § 198-c.

Coming Soon- Will New York Ban Non-Competes?

Lastly, a bit of a cliffhanger. For the past several months, Governor Hochul has had New York Senate Bill S.3100A on her desk that, if signed into law, will effectively ban future non-compete agreements in New York. See S.3100A. The bill prohibits employers from seeking, requiring, demanding, or accepting a non-compete agreement from any covered individual. “Non-compete” is broadly defined as “any agreement, or clause contained in any agreement, between an employer and a covered individual that prohibits or restricts such covered individual from obtaining employment, after the conclusion of employment with the employer included as a party to the agreement.” On its face, this does not appear to affect non-solicitation provisions, which would still be subject to a reasonableness test if challenged in court, or other practices such as garden leave or paid notice. “Covered individual” is also broadly defined in the bill to effectively include all employed persons. The bill would void any contrary provisions, but only for non-competes executed or amended after its effective date. The bill would also allow employees to bring civil lawsuits against employers that violate the law, and grant courts authority to order all appropriate relief, including injunctive relief, liquidated damages of not more than $10,000 “to every covered individual affected under this section,” lost compensation, damages, reasonable attorneys’ fees, and costs.

Currently, California, North Dakota, Oklahoma, and Minnesota are the only other states with total prohibitions such as this one. Many other states, including Rhode Island and Washington, D.C., ban non-competes for workers who make under a certain amount. New York’s ban, if signed, will apply prospectively to agreements entered into or modified on or after it becomes effective, which will be 30 days after it is signed.

New York employers should take the opportunity to finalize any pending non-competes now, and make sure you are following the status of the bill. Your existing non-competes are still enforceable, to the extent they are reasonable, although former employees often challenge them. If challenged, New York courts consider factors such as whether the covenant is reasonable in time and geographic area, is necessary to protect the employer’s legitimate interests, imposes an undue hardship on the employee, and is injurious to the public. If a court determines that the agreement is overbroad, it may either partially enforce it “to the extent necessary to protect an employer’s legitimate interest” or it may decline to enforce the agreement entirely.

Our Labor & Employment group will continue to monitor the developments in the N.Y. Labor Law closely, including the pending non-compete ban, and will provide an update with new information as it becomes available.

[1] The law does not apply to jobs posted by temporary help firms on behalf of other employers. See N.Y. Department of Labor Proposed Regulatory Text, Ch. II, Subchapter G, N.Y. Comp. Codes R. & Regs. tit. 12, § 194-2.1 (2023).