The New York Division of Human Rights Announces It Will Discontinue Private Settlements

Print Friendly, PDF & Email

By Jean Schroll, Esq.

On October 1, 2021, the New York State Division of Human Rights (the “Division”) announced that, for all complaints filed on or after October 12, 2021, it will no longer issue Commissioner’s Orders discontinuing complaints after private settlement.  This is a significant change because, as the Division notes, “nearly half of all post-probable cause settlements are private settlements without any public record of the terms of the settlement.”

Prior to this announcement, employers and complainants could negotiate a private settlement and simply request a Commissioner’s Order to discontinue the complaint.  The terms of the private settlement did not need to be disclosed to the public, or even to the Division.  For all complaints filed on or after October 12, 2021, however, this is no longer a possibility.  Now, after a probable cause determination, a Complainant’s attorney will be required to state in writing why they are seeking a discontinuance, which will not be granted if the reason is private settlement.

Instead, the parties must either: (a) settle the matter through an Order after stipulation that includes the settlement terms, or (b) proceed through the public hearing process.  This effectively eliminates the ability to confidentially settle a matter without public disclosure of the terms – one of the major draws of settling privately in the first place. 

The Division states it is making this change “in the public interest for increased transparency and good governance regarding settlements.”  It further states that, as all cases are brought in the name of the Division, it has a vested interest in each outcome to ensure that the terms of the settlement comply with the Division’s standards and do not violate public policy.

A few questions remain.  First, it is unclear if the new prohibition only applies in cases where a probable cause determination has already been issued, or if the parties can still privately settle up to that point.  Second, the announcement does not specify exactly which terms must be included if the matter is settled through an Order after stipulation.

For many employers, confidentiality is a material term that weighs heavily in a decision to settle.  Going forward, employers should carefully consider the impact of this announcement when strategizing settlement negotiations for a matter pending before the Division.

The Division’s announcement can be accessed here: https://dhr.ny.gov/discontinuance-private-settlements.

Please contact me or a member of NFC’s litigation team if you have any questions about the Division’s announcement. 


SIGN UP

SIGN UP NOW to receive time sensitive employment law alerts and invitations to complimentary informational webinars and seminars.

"*" indicates required fields

By clicking this button and submitting information to us, you will be submitting certain personally identifiable information, or information which used together with other information, can be used to identify you and/or identify information about you, to Nukk-Freeman & Cerra, PC (“NFC”). Such information may be used by NFC to contact or identify you. Personally identifiable information may include, but is not limited to, your [name, phone number, address and/or] email address. We collect this information for the purpose of providing services, identifying and communicating with you, responding to your requests/inquiries, and improving our services. We may use your personally identifiable Information to contact you with time sensitive employment law e-alerts, marketing or promotional offers, invitations to complimentary and informational webinars and seminars, and other information that may be of interest to you. However, by providing any of the foregoing information to you, we are not creating an attorney-client relationship between you and NFC: nor are we providing legal advice to you. You may opt out of receiving any, or all, of these communications from us by following the unsubscribe link in any email we send. However, this will not unsubscribe you from receiving future communications from us which are based upon an independent request, relationship or act by you.