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By Rachel H. Khedouri, Esq.

On January 26, 2022, new and dramatically expanded protections go into effect for employees in New York who report employer actions they believe to be illegal. Until now, the protection of Section 740 of the New York Labor Law — New York’s “whistleblower” law for private employees — has been limited to a current employee’s disclosure to a supervisor or public body of an actual violation of the law that directly relates to a substantial and specific danger to public health or safety or health care fraud. Senate Bill S4394A amended New York’s whistleblower law by:

  • Prohibiting adverse action against employees who blow the whistle on any employer activity, policy, or practice that they reasonably believe is in violation of any law, rule or regulation or poses a danger to public health or safety, even if there is no actual violation;
  • Clarifying that the “law, rule or regulation” at issue can include any federal, state or local statute, ordinance or executive order as well as any judicial or administrative decision, ruling, or order;
  • Covering employees even if they are acting outside of the scope of their job duties;
  • Expanding the definition of “employee” to include former employees and independent contractors;
  • Expanding the “retaliatory action” prohibited under the law to include not just impact on current terms or conditions of employment such as by discharge, suspension, or demotion but also (i) actions (or threats to take actions) that would adversely impact a former employee’s current or future employment and (ii) contact with (or threats to make contact with) immigration authorities;
  • Extending the statute of limitations for claims from one to two years and adding the right to a jury trial; and
  • Expanding the remedies a court may award to include front pay, a civil penalty up to $10,000, and punitive damages if the violation was willful, malicious, or wanton.

Significantly, the amendment also alters the employee’s obligation to bring the issue to the attention of a supervisor and give the employer a chance to fix the violation in advance of disclosure to a public body. The amended law requires only a “good faith effort” to provide this notice and eliminates this requirement entirely under certain circumstances, including where there is an imminent and serious danger to public health or safety, where the employee reasonably believes that reporting to the supervisor first would result in the destruction of evidence or physical harm to the employee or another, or where the employee reasonably believes the supervisor is already aware of the issue and will not correct it.

What must employers do now?
Employers are required to post a notification of whistleblower rights and protections under the law for employees and applicants in “accessible and well-lighted places. “We expect that the New York Department of Labor will publish a model notice shortly.

In addition, employers should review their policies and training to ensure that they are in compliance with the new law and that managers respond appropriately to any employee complaints that could lead to whistleblower obligations.

If you have any questions relating to this new law or would like assistance in reviewing your whistleblower or other employment policies or drafting the required notice under this new law, please reach out to the NFC Attorney with whom you typically work or call us at 973.665.9100.


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