New York State lawmakers have done it again – amending an often-forgotten whistleblower statute of limited application into a sweeping new source of employee rights that should make employers listen up and take notice. Almost two years ago it was Section 741 of the New York Labor Law, focused on healthcare workers. This time, it’s Section 740, which applies to all private-sector employers. Below, we provide you with a run-down of the changes and how employers can prepare for the January 26, 2022 implementation date.
BACKGROUND
Although it has been around for decades, Section 740 is not the first law that comes to mind when an employer thinks of the various laws protecting its employees. That’s because the statute’s restrictions diminish its usefulness as a tool for employees seeking relief for an alleged retaliatory act. For example, the statute is narrow – it only applies when an employee discloses, or threatens to disclose, to the employee’s supervisor or a public body, an actual violation of law, rule or regulation that presents “substantial and specific” danger to public health or safety, or healthcare fraud. Even then, it only has a one-year statute of limitations and there is no right to a jury trial. And on top of that, even if an employee prevails, their remedies are limited to reinstatement, back pay, and attorneys’ fees, but not compensatory or punitive damages. Taken together, employees had little incentive to bring claims under Section 740.
KEY AMENDMENTS
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