On March 13, 2013, the New York City Council (the "Council") overrode Mayor Michael Bloomberg's veto and passed a new statute named "Prohibiting discrimination based on an individual's unemployment" (the "Statute"). The Statute bans discrimination against the unemployed in connection with employment decisions, with certain exceptions discussed below. Although the Statute is not the first of its kind in the United States, it is the first to allow rejected applicants to bring a private suit asserting discrimination on the basis of unemployment status.
Employer Obligations under the Statute
The Statute prohibits an employer from basing an employment decision (such as hiring or compensation) "on an applicant's unemployment." In addition, the Statute prohibits an employer from advertising that current employment is a qualification for a job, or that an applicant will not be considered for hire because of his/her unemployed status. The Statute applies to all employers who have four or more persons under their employ. Natural persons (as opposed to businesses) who are independent contractors and not themselves employers, and who perform work for the employer in furtherance of the employer's business enterprise count towards the four employee requirement. (We can help you determine which of your independent contractors and consultants might apply.)
Fortunately for employers, the Statute contains several exceptions. For example, an employer may consider an applicant's unemployed status in an employment decision if there is a "substantially job-related reason" for doing so. The Statute neither defines this term nor offers examples of it. An employer may also question an applicant about the circumstances surrounding his or her separation from a previous employer, and may also consider "any substantially job-related qualifications" as reasons for not hiring the applicant. Here, the Statute does offer examples. "Substantially job-related qualifications" include an applicant's failure to have a professional occupational license, a registration, a permit, a minimum level of education, and a minimum level of professional, occupational, or field experience. Finally, when making certain employment decisions, an employer may chose to consider only (or give priority to) applicants whom it currently employs.
The Statute also prohibits employment practices that have a "disparate impact" on people protected by the Statute. At its core, the disparate impact theory requires the applicant to show that the employer has a policy or practice that falls more harshly on people protected by the Statute (e.g., the unemployed) than others; upon such a showing, the employer must then show that the policy or practice "has as its basis a substantially job-related qualification or does not contribute to the disparate impact." The Statute takes effect ninety days after its passage.
Implications For Employers
Employers should review and consider modifying their current advertisements, hiring processes and employment applications in order to be in compliance with the Statute. Further, employers should train all of their personnel involved in the hiring process to ensure compliance with the Statute. We can assist you in preparing for, understanding and complying with the Statute.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
