FILE – The New York state Senate meets within the Senate Chamber on the opening day of the legislative session on the state Capitol in Albany, N.Y., on Jan. 8, 2020. Democrats within the New York Legislature on Monday, Feb. 26, 2024, rejected a congressional map drawn by the state’s bipartisan redistricting fee, setting the stage for the occasion to craft traces that assist Democrats in battleground Home races that might decide management of Congress.
(AP Photograph/Hans Pennink, File)
Because the calendar turns to 2026, these working New York companies have rather a lot on their minds. Inflation, financial uncertainty, tariffs, rising provide chain and labor prices, immigration enforcement’s influence on the workforce. The checklist is lengthy.
It’s comprehensible some issues could not present up excessive on the radar, however are essential nonetheless. We tracked 4 late-year 2025 adjustments that may influence employers in 2026. It’s important employers are conscious of those December adjustments so that they meet these compliance obligations in 2026.
Right here’s what employers must know:
Prohibition on retaliating towards people requesting affordable lodging
Gov. Kathy Hochul signed Senate Invoice S3398 into legislation to amend the New York State Human Rights Regulation (HRL) as a result of that legislation was silent on whether or not requesting an affordable lodging constitutes a protected exercise for functions of retaliation claims.
The HRL requires coated employers to offer affordable lodging to workers with disabilities and prohibits retaliation towards workers who have interaction in protected exercise.
Because the statute didn’t expressly state that requests for affordable lodging have been protected, courts have regularly grappled with this situation and sometimes concluded such requests didn’t qualify as protected exercise.
The modification aligns the HRL with the New York Metropolis Human Rights Regulation to expressly present that requesting an affordable lodging constitutes protected exercise. Consequently, New York employers ought to extra rigorously think about employment selections involving workers who request lodging, as opposed actions based mostly on such requests could give rise to retaliation claims underneath the amended HRL.
New York formally establishes disparate influence framework inside the HRL
The HRL was additional amended to immediately reply to the federal authorities’s newly adopted place on the therapy of “disparate impact” claims. It formally codifies disparate influence as a foundation for proving illegal discrimination underneath New York’s HRL.
The disparate influence principle usually supplies that even facially impartial office insurance policies could also be deemed discriminatory in the event that they disproportionately drawback a protected group.
The Trump administration has strenuously opposed the disparate influence principle, issuing an government order declaring “it is the policy of the United States to eliminate the use of disparate impact liability in all contexts to the maximum degree possible to avoid violating the Constitution, Federal civil rights laws, and basic American ideals.”
The chief order additionally directed federal companies to deprioritize enforcement of all statutes and laws that embrace disparate influence legal responsibility. In response, the Equal Employment Alternative Fee issued an inner memorandum stating it’ll not examine prices based mostly solely on a disparate influence principle. As a substitute, people looking for to pursue such claims should achieve this in courtroom, reasonably than by the EEOC’s administrative course of.
On account of this federal shift, New York amended the HRL to make sure disparate influence claims stay absolutely acknowledged and enforceable underneath state legislation. New York employers ought to proceed to judge their insurance policies and practices to find out whether or not they might disproportionately influence protected teams and, if that’s the case, take steps to mitigate the chance of legal responsibility.
The ‘Trapped at Work Act’
The New York Labor Regulation was amended to incorporate a element referred to as the “Trapped at Work Act.” The act prohibits using stay-or-pay agreements, referred to inside the statute as “employment promissory notes.”
The act defines an “employment promissory note” as “any instrument, agreement, or contract provision that requires a worker to pay the employer, or the employer’s agent or assignee, a sum of money if the worker leaves such employment before the passage of a stated period of time.” The act additional prohibits any settlement that characterizes compensation as reimbursement for employer-provided coaching. Such agreements or provisions are deemed unconscionable, opposite to public coverage and, due to this fact, null and void.
The act supplies 4 restricted exceptions to the overall ban on employment promissory notes:
compensation of payroll advances unrelated to coaching;
cost for employer-provided property bought or leased to the employee;
agreements tied to sabbatical go away for academic personnel; and
applications agreed to underneath a collective bargaining settlement.
Failure to adjust to the act can topic employers to civil penalties starting from $1,000 to $5,000 for every violation. Moreover, staff who’re sued by an employer to implement the provisions of an employment promissory be aware coated by the act will be capable to get better attorneys’ charges for a profitable protection.
Whereas it’s not particularly addressed within the statute, it seems to use to current agreements signed earlier than its efficient date and sure makes such agreements null and void.
Employer use of credit score stories in New York
New York’s Common Enterprise Regulation has been amended to increase the identical protections afforded underneath New York Metropolis’s current laws that prohibits employers from requesting or utilizing shopper credit score histories when making employment selections.
The legislation defines shopper credit score historical past as: “(1) a consumer credit report; (2) credit score; or (3) information an employer obtains directly from the individual regarding (i) details about credit accounts…or (ii) bankruptcies, judgments, or liens.”
Underneath the brand new laws, it’s an illegal discriminatory apply for an employer to make use of an applicant’s or worker’s shopper credit score historical past for employment functions or to in any other case discriminate towards an applicant or worker with respect to hiring, compensation, or the phrases, circumstances or privileges of employment.
The legislation does, nevertheless, present a number of exceptions. Employers should request or use an applicant’s or worker’s shopper credit score historical past for sure roles, together with:
individuals making use of for positions as or employed as cops or peace officers;
individuals able that’s topic to a background investigation by a state company;
individuals able during which an worker is required to be bonded underneath state or federal legislation;
individuals able during which an worker is required to own a safety clearance;
workers which have common entry to commerce secrets and techniques, intelligence info or nationwide safety info; and
individuals able during which an worker has vital monetary tasks.
Whereas these new legal guidelines could not have garnered enormous headlines throughout the vacation season, they’re price being attentive to so your online business stays in compliance in 2026.
Roy R. Galewski and Corey J. Butts are members of Harris Seaside Murtha’s labor and employment apply group
