United States: The BakerHostetler Quarterly New York Employment Newsletter - Fall 2018

Welcome to the second edition of The BakerHostetler Quarterly New York Employment Law Newsletter. We are pleased to share our analysis of some key employment trends, in-depth discussions regarding recent developments and what to expect looking forward.



  • The Equal Opportunity Employment Commission (EEOC) has announced that sexual harassment filings have increased with the federal agency.
  • With increased charges, we have also seen increased litigation. By way of example, female employees at Nike have brought a class action lawsuit alleging sex harassment, sex discrimination, and unequal pay. Many other large employers (e.g., ESPN) have seen similar lawsuits. It is likely we will continue to see lawsuits like these, especially as states continue to pass pay equity laws of their own.
  • More states have passed legislation addressing sexual harassment.

    • For example, on May 30, Vermont passed "An Act Relating to the Prevention of Sexual Harassment," which provides expansive protections for employees, prospective employees, independent contractors, and unpaid interns regarding sexual harassment in the workplace.

      • Effective July 1, the law sets out new restrictions and regulations governing sexual harassment, including:

        • A prohibition against requiring employees to arbitrate sexual harassment claims;
        • A prohibition against including a provision in any sexual harassment settlement agreement preventing the claimant-party from working for the employer in the future; and
        • Broad powers for the Vermont attorney general to conduct an inspection of an employer's records and work site in connection with an investigation into sexual harassment claims.

Misclassification of Employees

On the heels of New Jersey's governor announcing a crackdown on the misclassification of workers, in August, the New Jersey Department of Labor and the United States Department of Labor signed a letter pledging cooperation in rooting out worker misclassification. The letter of cooperation means that the federal and state agencies will coordinate investigations and share resources. The state agency said that the agreement "sends a strong message" to businesses that misclassification laws "are being strictly enforced." The state agency hinted that it will be focused on construction, transportation, and information technology employers and workers who participate in the gig economy.

Protection for Sexual Orientation

We continue to see a shift toward sexual orientation being recognized as a protected class at the state level. For example, Pennsylvania has created a Commission on LGBTQ Affairs, which will advise the governor's office on "outreach and important issues in the LGBTQ community." These efforts will include lobbying for legislation to support the LGBTQ community, including nondiscrimination protections.

Removal of "No Poach" Clauses

  • Earlier this year, the Department of Justice (DOJ) announced that it would be pursuing criminal charges against companies that enter into "no poach" agreements with other companies.
  • In response, an increasing number of companies have proactively announced the removal of no-poach clauses from their business contracts in response to the DOJ's increased scrutiny:

    • On July 13, seven fast food chains (Auntie Annie's, Arby's, Buffalo Wild Wings, Carl's Jr., Cinnabon, Jimmy John's, and McDonald's) announced the removal of "no-poach" clauses from their contracts with franchisees.
    • On Aug. 7, eight more fast food chains (Applebee's, Church's Chicken, Five Guys, IHOP, Jamba Juice, Little Caesar's, Panera, and SONIC Drive-In) agreed to the removal of their no-poach clauses.
    • The no-poach provisions these chains had in place prohibited workers at, for example, one Carl's Jr. franchise from going to another Carl's Jr.
    • The announcements were both made as part of a deal these companies made with the attorney general of Washington, who was conducting an investigation into no-poach clauses used by these companies.

Rise of ADA Website Accessibility Class Actions Lawsuits

  • During the past year, there has been a spike in lawsuits filed against company websites, alleging violations of Title III of the Americans with Disabilities Act (ADA). These cases have targeted employers in a wide variety of industries nationwide. Plaintiffs in these cases have generally alleged that the targeted websites are discriminatory because they are not accessible to people with vision, hearing, or other disabilities. The majority of these lawsuits have been filed in federal court (primarily in New York, Florida, and California), with many being filed as class actions.
  • The relief sought is primarily injunctive, prohibiting any additional alleged discriminatory activity, and requiring website remediation to allow people with various disabilities to access the content therein, in addition to awards of attorneys' fees and costs.
  • In New York, these lawsuits have also included state and local statutory claims asserted under the New York State Human Rights Law (NYSHRL) and New York City Human Rights Law (NYCHRL).
  • Earlier this month, two New York City hotel operators got slapped with proposed class actions in federal court accusing them of violating the ADA, the NYSHRL, and the NYCHRL because they failed to ensure that their websites' online reservation systems offer full accessibility to the disabled. The complaint also alleges that both operators run hotels with online reservation systems that fail to describe ADA-accessible features in detail and do not permit disabled individuals to independently assess whether the hotels and their available guest rooms meet their individual accessibility needs.

Rise in Litigation Under the Defense of Trade Secrets Act

  • Two years after the enactment of the Defense of Trade Secrets Act (DTSA) on May 11, 2016, a review of the federal docket reveals that trade secret litigation under the DTSA has risen nearly 30 percent.
  • The top three jurisdictions with the most filings under the DTSA are the Central District of California, the Northern District of Illinois and the Southern District of New York.

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