New York Termination Laws

New York termination laws are designed to balance employees’ rights and employer’s obligations. Understanding these laws is crucial for maintaining compliance and practicing rights, whether you are an employer or an employee. This article explores the legal frameworks, outlining critical aspects employers in New York must consider to ensure complaint and fair termination practices.

This Guide Covers

Legal Considerations for Termination in New York

“At-Will” Employment in New York

• What is “At-Will” Employment?
• What are the Exceptions to “At-Will” Employment in New York?
• Employment Under Contract in New York

Lawful Termination in New York

• Legal Grounds for Termination in New York
• How Do I File a Wrongful Termination Claim in New York?

Legal Protections During Termination in New York

Terminated Employee Benefits in New York

Layoffs in New York

Resignations in New York

• Voluntary Resignations
• Involuntary Resignations

Legal Cases Related to Wrongful Termination in New York

Legal Considerations for Termination in New York

When considering termination in New York, employers should be aware of several legal considerations:

• “At-Will” Employment: New York follows the “at-will” employment doctrine, wherein employers or employees can terminate their employment at any time, for any reason or no reason at all, without prior notice.
• Anti-Discrimination Laws: Both federal and New York State laws protect employees from termination based on characteristics such as race, gender, age, religion, national origin, disability, sexual orientation, and gender identity. Employers must ensure that termination decisions are based on legitimate business reasons unrelated to these characteristics.
• Retaliation Protections: Employees are protected from termination for participating in protected activities, such as filing discrimination complaints, reporting workplace safety issues, or participating in investigations.
• Employment Contracts: If an employee has a written contract or is covered by a collective bargaining agreement, the terms of termination specified in the contract must be followed. These agreements may outline specific procedures or require just cause for termination.
• Public Policy Violations: Employers cannot terminate employees for reasons that contravene public policy. For example, firing an employee for refusing to engage in illegal acts, serving on a jury, or reporting illegal activities would violate public policy and could result in legal action.
• Documentation: Maintaining clear and consistent documentation of performance issues or misconduct is crucial. This documentation provides evidence to support termination decisions and can be critical in defending against claims of wrongful termination.
• Severance Pay: New York does not mandate severance pay unless stipulated by an employment contract or company policy. Severance is typically a negotiated benefit offered under the Unemployment Insurance reform law.
• Final Pay: Employers must provide final pay, including unpaid wages and any accrued benefits like vacation leave, under state law and company policy. Final wages do not include severance pay.
• Notice Requirements: Although New York does not require notice of termination for at-will employees, some employment contracts or termination due to plant closures and mass layoffs may require notice periods. Compliance with these requirements is necessary to avoid potential legal issues.

“At-Will” Employment in New York

What is “At-Will” Employment?

“At-will” employment in New York means that either the employer or the employee can terminate the employment relationship at any time, for any reason, or no reason at all, without prior notice, as long as it is not for an illegal reason (such as discrimination or retaliation).

What are the Exceptions to “At-Will” Employment in New York?

While the “at-will” employment doctrine allows for terminating employment relationships at any time for any reason, several key exceptions limit this flexibility in New York. These exceptions include:

• Discrimination: Federal and state laws prohibit termination based on discrimination. This includes protections under the Civil Rights Act, the Americans with Disabilities Act (ADA), the Age Discrimination in Employment Act (ADEA), and the New York State Human Rights Law. Employers cannot terminate employees based on characteristics such as race, gender, age, religion, disability, or national origin.
• Retaliation: Employees are protected from termination if they engage in activities that are legally protected, such as filing a discrimination complaint, reporting workplace safety violations, or participating in an investigation. Retaliation claims can arise if an employer fires an employee in response to such actions.
• Written Contracts: If there is a formal employment contract or a collective bargaining agreement in place, it may specify terms of employment, including grounds for termination. Such contracts may stipulate that an employee
• Implied Contracts: Even without a formal written contract, an implied contract may exist if there are outlined terms and conditions in the employee handbook, company policies, or even verbal promises made by employers.
• Good Faith and Fair Dealing: Courts recognized an implied covenant of good faith and fair dealing in employment relationships. This exception is less commonly invoked but can prevent terminations made in bad faith, motivated by malice, or intended to deprive employees of earned benefits or compensation.

Employment Under Contract in New York

In New York, employment under contract provides specific terms that govern the employment relationship, differing from the “at-will” employment doctrine. These contracts may outline conditions such as job duties, salary, benefits, and termination procedures.

Employment contracts often require “just cause” for termination, meaning an employer must provide a legitimate reason that aligns with the contract’s terms. Contracts can also specify notice periods and severance agreements.

Lawful Termination in New York

Legal Grounds for Termination in New York

In New York, termination of employment falls under the “at-will” doctrine, allowing employers or employees to end the relationship at any time without cause. However, several legal grounds and exceptions exist:

• Just Cause: When specified in employment contracts or collective bargaining agreements, termination must be based on legitimate grounds reasons, such as violations of specific job responsibilities or misconduct.
• Performance Issues: Employees can be terminated for consistently failing to meet job expectations or performance standards. Proper documentation of performance reviews and feedback is crucial to support such decisions.
• Misconduct: Serious violations of company policies, such as theft, harassment, or breach of contract can warrant termination. Employers must ensure they have clear policies in place and conduct thorough investigations before proceeding.
• Reductions in Force (Layoffs): Employers may terminate employees due to economic downturns, organizational restructuring, or changes in business needs. These layoffs should be based on legitimate business reasons and not discriminate against any protected class.
• Legal Violations: Employers must avoid termination based on discriminatory factors such as race, gender, age, or disability. Termination should not violate public policy, such as firing an employee for refusing illegal acts or reporting unlawful activities.

Read our comprehensive guide to firing employees in New York for further information.

How Do I File a Wrongful Termination Claim in New York?

To file for a wrongful termination claim in New York, collect all relevant documents related to your employment, termination, and any communications that may support your claim (e.g. employment contracts, performance reviews, termination notice, and emails). Determine the legal basis of your claim (discrimination, retaliation, breach of contract, or violation of public policy).

You can file your claims with the Equal Employment Opportunity Commission (EEOC) within 180 days of the alleged discrimination or retaliation; or with the New York State Division of Human Rights (NYSDHR) within one year of the alleged discriminatory or retaliatory act.

Legal Protections During Termination in New York

• New York Human Rights Law (NYHRL): The NYHRL prohibits discrimination based on age, race, color, creed, national origin, sexual orientation, gender identity or expression, disability, military status, marital status, domestic violence victim status, and arrest or conviction record. This state law provides protections against discriminatory practices during termination and allows employees to file complaints with the New York State Division of Human Rights for investigation and potential action.
• New York Labor Law Section 740: Section 740 of the New York Labor Law protects employees who report illegal activities or violations of laws, rules, or regulations within their workplace (“whistleblowers”). It prohibits retaliation against employees who disclose or threaten to disclose such information, ensuring their rights are safeguarded during termination if related to whistleblowing activities.
• New York Labor Law 191: This law requires employers to promptly pay wages to terminated employees, including accrued vacation time or other earned benefits. It ensures that employees receive their final paychecks promptly, typically on their last day of employment or within a designated time frame after termination, depending on the circumstances.
• New York State Worker Adjustment and Retraining Notification (WARN) Act: The NY WARN Act mandates that employers with 50 or more full-time employees provide at least 90 days’ advance notice before mass layoffs, plant closings, or significant workforce reductions. This notice period allows affected employees and their communities time to adjust and seek alternative employment or retraining opportunities, fostering a smoother transition during periods of economic change.
• Fair Labor Standards Act (FLSA): The FLSA establishes federal standards for minimum wage, overtime pay, recordkeeping, and child labor. It protects employees by ensuring they receive fair compensation for their work and prohibits retaliation against employees who assert their rights under the Act, such as filing complaints about wage violations, which includes protections during termination.
• Family and Medical Leave Act (FMLA): The FMLA provides eligible employees with unpaid, job-protected leave for specific family and medical reasons. It ensures that employees can take time off of their serious health conditions, to care for a family member with a serious health condition, or for certain reasons related to military service without the fear of losing their job or benefits during or after their leave period.

Terminated Employee Benefits in New York

Terminated employees in New York may be entitled to certain benefits and protections, depending on various factors such as employment contracts, company policies, and state regulations.

• Final Pay: Employers must provide final wages promptly upon termination, including payment for accrued but unused vacation time and any other benefits accrued up to the termination date.
• Severance Pay: Terminated employees may receive severance pay depending on their employment contract, company policy, or collective bargaining agreement. Severance pay is considered dismissal pay under the Unemployment Insurance law and covers payments made by an employer to an employee due to separation from employment.
• Unemployment Benefits: Employees who are laid off may be eligible for unemployment benefits through the New York State Department of Labor. Eligibility is determined based on factors such as prior earnings and the circumstances of the layoff.
• Health Insurance Continuation: Laid-off employees may have the option to continue their health insurance coverage through COBRA (Consolidated Omnibus Budget Reconciliation Act) or New York State Continuation Coverage (mini-COBRA), allowing them to maintain coverage for a limited period by paying the full premium themselves.

Layoffs in New York

Layoffs in New York refer to the reduction of employees due to factors such as economic downturns, organizational restructuring, or other business-related reasons. Employers conducting layoffs must comply with the:

• Federal Workers Adjustment and Retraining Notification (WARN) Act: The federal WARN requires employers with 100 or more employees to provide at least 60 days advance notice before plant closings or mass layoffs affecting 50 or more employees at a single site of employment.
• New York Workers Adjustment and Retraining Notification (WARN) Act: The state WARN Act supplements the federal WARN Act by providing additional protections and notice requirements for employees in New York. This applies to private employers with 50 or more full-time employees who must comply with New York State regulations. The act requires employers to provide affected employees with at least 90 days advance notice before a mass layoff or plant closing affecting 25 or more employees at a single site of employment.

Resignations in New York

Voluntary Resignations

A voluntary resignation occurs when an employee chooses to end their employment. The decision is initiated by the employee without coercion or pressure from the employer. Employees are not required to provide a resignation letter unless specified in their employment contract or company policy. Although not required, employees are still expected to provide notice at least two weeks to a month.

In addition, employees who resign may not be entitled to severance pay unless specified in their employment contract or company policy. They are only entitled to final wages including payment for accrued but unused vacation leave, on the employee’s last day of employment.

Involuntary Resignations

Involuntary resignation, also known as constructive dismissal, occurs when an employee creates a hostile work environment or conditions that make continued employment intolerable for the employee. The employee may resign under duress due to the employer’s actions or policies.

Legal Cases Related to Wrongful Termination in New York

1. New York Teacher Awarded $3.5 Million in Wrongful Termination Suit

A New York teacher was awarded nearly $3.5 million after a jury found she was wrongfully terminated due to her association with her boyfriend, who was convicted of sex offenses. The teacher alleged that the school district used her relationship as a pretext to terminate her employment, despite claiming she was fired for not reporting the abuse.

The jury sided with the teacher, awarding her $1 million for emotional pain, $351,900 for lost wages, and $2.1 million for lost future wages. This substantial award reflects the jury’s recognition of the severe impact wrongful termination can have on an individual’s life and career.

Key lessons learned from this case:

• While New York generally follows at-will employment, employers cannot terminate employees for illegal reasons, including discriminatory ones. This case underscores the importance of understanding the exceptions to at-will employment.
• The verdict highlights that employees cannot be fired based on their associations, such as being related to or in a relationship with someone accused or convicted of a crime. Employers must ensure that terminations are based on legitimate, non-discriminatory reasons.
• The significant financial award in this case demonstrates the potential for substantial compensation for wrongful termination, including damages for emotional distress, lost wages, and future earnings. This serves as a deterrent to employers considering unlawful termination practices.

2. Warren Tricomi to Pay $30,000 to Settle EEOC Pregnancy Discrimination Suit

In EEOC v. Warren Tricomi, the EEOC charged Warren Tricomi with violating Title VII of the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination Act (PDA), which prohibits employment discrimination based on pregnancy. The suit was filed after unsuccessful attempts at a pre-litigation settlement through the EEOC’s conciliation process. Warren Tricomi agreed to pay $30,000 and provide a positive employee reference to settle a pregnancy discrimination lawsuit filed by the EEOC. The lawsuit alleged that the hair salon rescinded a promotion from assistant colorist to colorist and subsequently terminated the employee after learning of her pregnancy.

Key lessons learned from this case:

• Employers cannot make employment decisions based on an employee’s pregnancy status. This includes rescinding promotions or terminating employment.
• Employers must comply with the Pregnancy Discrimination Act (PDA) and Title VII, ensuring that all employment practices are free from discrimination based on pregnancy.
• Employees who face discrimination based on pregnancy have the right to file complaints with the EEOC and pursue legal action to seek compensation and justice.

3. Court Awards $1.6 Million to Chef in Gloria’s Tribeca Constructive Discharge Case

In the case of Salemi v. Gloria’s Tribeca Inc., Salemi sued Gloria’s Tribeca Inc. for constructive discharge and sex discrimination, citing violations of Title VII of the Civil Rights Act. Mirella Salemi, who worked as a chef and manager at Gloria’s Tribeca, faced a hostile work environment created by the restaurant owner, Edward Globokar. Globokar conducted weekly prayer sessions, which he made compulsory for his staff, during which he repeatedly condemned homosexuality as a sin and stated that gay people were destined for hell.

As a lesbian, Salemi found this environment increasingly hostile. She faced retaliation for objecting to these offensive comments and for refusing to fire another homosexual worker. The hostility eventually forced her to resign, leading to her claim of constructive discharge. Salemi sued Gloria’s Tribeca Inc. and the lawsuit claimed that Gloria’s Tribeca Inc. violated Title VII of the Civil Rights Act by creating a hostile work environment based on sex discrimination and retaliating against Salemi for her objections to discriminatory practices and refusal to comply with discriminatory demands.

Key lessons learned from this case:

• Employers must ensure that their workplace is free from harassment and hostility, particularly regarding protected characteristics such as sexual orientation.
• Employers should not impose religious beliefs or practices on their employees, especially if such practices are used to promote discriminatory views.
• Retaliating against employees for objecting to discriminatory practices or for supporting fellow employees who face discrimination is a violation of Title VII.
• Employees who are forced to resign due to a hostile work environment can claim constructive discharge and seek legal redress for their forced resignation.

Learn more about New York Labor Laws through our detailed guide.

Important Cautionary Note

This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.

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FAQs

Some frequently asked questions.

Yes, New York is an “at-will” employment state. This means that, unless there is a contract stating otherwise, either the employer or employee can terminate the employment relationship at any time, for any reason, or for no reason at all, with some exceptions for unlawful discrimination or retaliation.

Yes, in New York, employers can terminate employees without providing a written warning. “At-will” employment allows employers to end the employment relationship at their discretion, as long as it does not violate anti-discrimination laws or other legal protections.

No, employees in New York are not required to provide a reason for resigning. Resignation is a voluntary decision, and employees are free to leave their jobs without explaining their decision to their employer unless specified otherwise in an employment contract or company policy. However, it is a good practice of courtesy to provide notice and give the employer time to hire a replacement or make necessary adjustments.

In New York, whether you receive severance pay upon being fired can vary based on your specific circumstances. Severance pay, considered dismissal pay under the Unemployment Insurance Law, is payments made by an employer to an employee due to separation from employment. However, it is not the same as final wages and does not include payments for accrued leave, health insurance, or supplemental unemployment benefits.

Constructive dismissal, also known as involuntary resignation, occurs when an employer creates a work environment that is so intolerable that an employee feels compelled to resign. This can include actions such as harassment, discrimination, or significant changes in job duties or compensation without agreement. Employees who resign under these conditions may have legal recourse similar to wrongful termination claims.

Yes, employers in New York can terminate an employee for failing a drug test, provided that the drug testing policies and procedures comply with state and federal laws, including those related to privacy and discrimination. New York follows a Drug-Free Workplace Policy outlining the consequences of a positive drug test, which may include termination of employment.

Jibble, a software for tracking time and managing attendance , can help employers maintain accurate records of employee performance, attendance, and compliance with company policies. This documentation can be crucial in justifying terminations and defending against wrongful termination claims. Employers can use these records to demonstrate consistency and transparency in their termination decisions.

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