New York City Enacts Unemployment Discrimination Ban

The New York City Council ("NYC Council") has enacted a law that bars New York City employers from refusing to hire a job applicant because the applicant is not currently employed (the "Law").

The Law¹ prohibits an employer²:

• From using a persons' employment status as a basis for hiring, determining compensation or the terms, conditions or privileges of an applicant's employment; and
• From posting job advertisements that require applicants to be currently employed.

The Law also gives an applicant rejected on the basis of his or her unemployment a private right of action to sue the prospective employer.

When Can Unemployment Status Be Considered By An Employer?

Specifically, the Law makes it illegal under New York's human rights laws for an employer to base a hiring decision on an applicant's unemployment status unless "there is a substantially job-related reason for doing so." The Law therefore permits an employer to inquire into the circumstances surrounding an applicant's previous employment termination.

The Law clarifies that an employer is not prohibited from considering any "substantially job-related qualifications" such as current and valid professional or occupational licenses; a certificate, registration, permit or other credential; as well as minimum required levels of education, training, professional, occupational, or field experience. Further, an employer is permitted to publish an advertisement for a job vacancy that sets forth any such "substantially job-related qualifications."

The Law also clarifies that an employer is not prohibited from determining that only applicants who are currently employed by the very employer doing the hiring will be considered for employment.

Restrictions When Advertising Job Vacancies

With respect to hiring, the Law prohibits an employer from publishing job vacancy advertisements, in print or on the internet, that: (i) require that an applicant be currently employed in order to qualify for the job; or (ii) indicate that an employer will not consider individuals for the job if currently unemployed.

Penalties

An individual who believes he or she has been unlawfully discriminated against based on unemployment status will now be able to file a complaint in court or with the New York City Human Rights Commission. A press release issued by the NYC Council states that, "The Commission will have the authority to order the employer to stop discriminatory practices, require discriminated applicants to be hired and subject the employer to penalties if they fail to comply with the Commission's orders." Failure to comply with such an order may result in a civil penalty of no more than $50,000 and an additional civil penalty of no more than $100 per day. Should the Commission find that an employer engaged in an unlawful, discriminatory practice, it may impose a civil penalty of $125,000. If the unlawful discriminatory practice resulted from the employer's "willful, wanton or malicious act," the Commission may impose a civil penalty of not more than $250,000. Should a person willfully violate an order of the Commission, he or she may be guilty of a misdemeanor that is punishable by imprisonment for not more than one year, or by a fine of not more than $10,000, or by both.

The Law will become effective 90 days after its enactment into law or June 11, 2013.

---

For more information on this issue or other employment matters, please contact Carol M. Goodman at [email protected] or 212.592.1465.

© 2013 Herrick, Feinstein LLP. Employment Alert is published by Herrick, Feinstein LLP for information purposes only. Nothing contained herein is intended to serve as legal advice or counsel or as an opinion of the firm.