New York City’s new law severely restricting voluntary employment in the fast food industry is scheduled to take effect July 4, 2021. Although a lawsuit seeking to order the law is pending, employers covered must work to ensure compliance with all of the various provisions of the law.
As previously discussed hereNew York City law undermining voluntary employment in the fast food industry will take effect on July 4, 2021. Covered fast food employers must implement policies and training to ensure compliance with this law. ri.
Below is a summary of the main features of the law:
- Only Cause Discontinuation and Progressive Discipline Policy. Furthermore for good economic reasons (discussed below), employers will be able to terminate or significantly reduce the hours of fast food workers only for demonstrated misconduct or poor performance, which should be “visible and harmful material to the employer’s legitimate fast food business interests.” Employers will need to prepare a progressive written disciplinary policy and provide affected employees with a written explanation with “correct reasons” for employee termination or reduction of hours.
- Bona Fide Economic Reason. In addition to poor performance and misconduct, employers may terminate workers or reduce their hours, based on a valid economic reason. However, such a decision must be “supported by the business records of a fast food employer”. Furthermore, an interruption or reduction of hours based on economic reasons must be performed in reverse order of seniority, and subsequent employments or overtime must first be offered to those whose hours have been interrupted or reduced.
- Exclusion of probationary employees. Employees in the first 30 days of work are exempt from the requirements of fairness and progressive discipline.
- Predictive planning. Fast food employers will need to establish predictive planning practices and systems to “provide every fast food employee with a regular schedule that is a predictable, regular set of weekly repetitive shifts that the employee will work on.” Every week”. Employers must provide a “written copy of [the employee’s] regular schedule ”, both (a) before the first shift of the employee and (b) whenever the employee schedule changes on an indefinite basis. (Prior to these changes, fast food employers were required to provide employees with only a written appraisal of trust.) Furthermore, the employer may not reduce employee hours by 15% unless: (1) the employee agrees to or requests the reduction in writing; or (2) the reduction was not substantial under the fair provisions of the law.
- Arbitration. On or after January 1, 2022, fast food employees will have the right to file an arbitration claim instead of a lawsuit to address an alleged wrongful dismissal or reduction in hours on their behalf and of any class of applicable to individuals. The law sets out specific requirements for the selection of an arbitrator and requires parties to comply with the American Arbitration Association employment rules as well as rules to be approved by the City Department of Consumer and Worker Protection.
On May 28, 2021, the Restaurant Legal Center and the New York State Restaurant Association set up a federal lawsuit seeking declarative and prescriptive relief to prevent the entry of the law on the basis of constitutional reasons and prepayment. This litigation is still pending, and until further notice, we recommend that all covered employers finalize their respective plans, policies and training to ensure that they comply with the new law.
Seyfarth will continue to monitor developments in this space and provide updates when available.