How Antidiscrimination Laws Apply to Employees Who Work Remotely
4.29.2024
Introduction
With the rise of remote work since the COVID-19 outbreak, courts will be asked to grapple anew with a perennial question: whether state and local antidiscrimination laws apply to workers who are not physically present in the jurisdiction. In New York and New Jersey, the courts have taken different approaches to this important threshold question.
Applicability of New York Statutes to Non-N.Y. Workers
In New York, the Court of Appeals definitively concluded more than a decade ago, in Hoffman v. Parade Publications, “a nonresident must plead that the alleged discriminatory conduct had an impact in New York” to be covered under the New York State and New York City human rights laws.[1]
The plaintiff in Hoffman was a Georgia resident who worked in Atlanta, attended occasional meetings in New York City, and did not service any accounts in New York.[2] Even though the decision to terminate the plaintiff’s employment was made in New York City, the court held that the plaintiff did not demonstrate a sufficient impact to invoke the protections of the New York City human rights laws.[3]
State and federal courts after Hoffman have consistently applied the court’s holding. The First Department recently affirmed the dismissal of a claim brought by a plaintiff living and working in Montreal, Canada, holding in Pakniat v. Moor, “[t]he fact that the alleged discriminatory acts and unlawful decision to terminate plaintiff’s employment occurred in New York is insufficient to plead impact in New York.”[4]
In opposition to the defendant’s motion to dismiss, the plaintiff in Pakniat specifically argued that the increase of remote working arrangements resulting from the COVID-19 pandemic necessitates expanding the jurisdictional breadth of the city and state human rights laws.[5] Despite expressing sympathy for the argument, the First Department ultimately declined the invitation, highlighting Hoffman’s “clear directive,” and holding that, “[t]o avail herself of [the state and city human rights laws], plaintiff must still satisfy the jurisdictional requirement that the impact of the discrimination was felt in New York City and State.”[6] Similarly, in a 2022 federal court decision, the court held that the pandemic had no effect on the Hoffman impact test.[7]
The “impact” test is narrowly construed and strictly applied. To maintain a claim under the city and state human rights laws, the impact of the alleged conduct must be felt within the boundaries of the city and state. In Shiber v. Centerview Partners LLC, for example, the plaintiff worked remotely from her home in New Jersey for a New York City-based company. She understood her remote work arrangement to be temporary and expected to work in person in the city when her employer’s offices reopened. However, her employer terminated her employment before reopening its offices.[8] The court dismissed the plaintiff’s claims, finding her expectation to work in the city insufficient to satisfy the jurisdictional requirement.[9] “Pleading impact in New York City by ‘unspecified future career prospects,’” the court said, would be an “impermissible broadening” of the statutes. The court further noted that “if ‘impact can be shown by a mere hope to work in New York down the line, the flood gates would be open.’”[10] Moreover, the court held, “a non-resident plaintiff’s occasional meetings in or travel to the city are tangential and do not satisfy the impact requirement.”[11]
In a 2014 decision, the First Department came to a similar conclusion on a vastly different set of facts.[12] There, the plaintiff worked for a New York City-based employer and resided in New York State, but not the city. She brought claims under the state and city laws against three out-of-state defendants for discrimination and retaliation after she rejected a superior’s sexual advances during a 2009 overseas assignment. The crux of her allegations was that, in retaliation for that rejection, the defendants diminished her responsibilities at the 2012 London Olympics.[13] The plaintiff argued the place of impact of the discriminatory acts – namely, the decision to reassign her and later reduce her responsibilities – should be controlled by her place of employment in New York City.[14] Drawing on Hoffman and its progeny, the First Department rejected her claims, concluding “it is the place where the impact of the alleged discriminatory conduct is felt that controls whether the Human Rights Laws apply, not where the decision is made.”[15] The “plaintiff’s mere employment in New York [did] not satisfy the ‘impact’ requirement” because the alleged discriminatory acts occurred in London and she made no claim that they had any impact on the “terms, conditions or extent of her employment . . . within the boundaries of New York.”[16]
Until recently, an open question remained under Hoffman: whether a nonresident plaintiff who is not yet employed in New York City or State satisfies the impact requirement if the plaintiff pleads and later proves that an employer deprived the plaintiff of a New York City- or state-based job opportunity on discriminatory grounds. The Second Circuit certified the question to the New York Court of Appeals on February 9, 2023.[17] In a March 14, 2024 opinion, the Court of Appeals answered this question affirmatively.[18]
The plaintiff was a Washington-D.C.-based woman of South Asian descent working for the defendant-employer. She alleged that she was subjected to discrimination when her employer failed to transfer her to one of several open, in-person positions based in New York City to which she had applied. She then resigned and alleged in her lawsuit that she was subjected to a constructive discharge based on her employer’s discriminatory failure to transfer her to those New York-based positions.[19]
The Court of Appeals held that the state and city human rights laws apply in such a situation because “a nonresident who has been discriminatorily denied a job in New York City or State loses the chance to work, and perhaps live, within those geographic areas.”[20] Buttressing its conclusion with policy considerations, the court noted that discriminatory conduct harms not only the nonresident applicants but also the state and the city, which “are deprived of [the] economic and civic contributions from [these] individuals.”[21] Notably, in a footnote, the court made clear that it was limiting its holding to positions that require the employee “to be physically present in New York, so that the decision would not apply where a non-resident was seeking a remote position based in New York City or State.”[22]
This decision may be read by some to be a departure from prior precedent, and it remains to be seen what impact the court’s analysis will have on individuals who are similarly situated to the plaintiff in Shiber – will an individual be entitled to the protections of the state and city human rights laws based upon a mere expectation of in-person work?
New Jersey Law Against Discrimination: Applicability to Out-of-State Employees
In New Jersey, a recent decision from the U.S. District Court for the District of New Jersey held that the state’s Law Against Discrimination applies to employees of New Jersey-based companies who live and work outside the state.[23]
The plaintiff in that case, Schulman v. Zoetis, Inc., lived and worked in New Hampshire. The defendant moved to dismiss on grounds that the Law Against Discrimination did not apply because the plaintiff’s “only meaningful allegation related to New Jersey [was] that the Defendants’ headquarters are there.”[24]
Applying a 2019 New Jersey state court holding,[25] the court denied the motion, holding that New Jersey’s law can “extend” to employment actions taken against non-New Jersey residents by New Jersey employers.[26] Based on this decision, the federal court predicted that the New Jersey Supreme Court, which has not yet addressed this issue, would apply the law to out-of-state employees.
In so ruling, the Schulman court highlighted three factors for the applicability of the law to out-of-state employees: 1) the location(s) of the person(s) within the company who took part in the decision to take the employment action; 2) the sole or dominant place, if any, that the decision was made; and 3) the location(s) of the plaintiff’s conduct that precipitated the employment decision.[27]
Ultimately, the Schulman court applied principles of statutory interpretation and followed analogous New Jersey state and federal court decisions in holding the plaintiff at-issue to be “like the plaintiff in Calabotta: a non-New Jersey resident working outside of New Jersey for a New Jersey-connected employer.”[28] In Calabotta, a non-New Jersey resident sued his “New Jersey-based former employer” for a violation of the New Jersey law.[29] The Calabotta court held that the Law Against Discrimination can “extend” to the non-promotion of a non-New Jersey resident into a New Jersey job and that it can “extend” to wrongfully discharging a non-New Jersey resident from a non-New Jersey-based job with a New Jersey entity’s subsidiary.[30]
Looking Ahead
Since the COVID-19 pandemic, employers have varied their approaches regarding employees returning to the office, ranging from five-day-per-week mandates to complete employee flexibility. Employers in both New Jersey and New York should consider the applicability of each state’s antidiscrimination laws in evaluating their remote work policies. The highest courts of both states may soon provide helpful clarification on the open questions discussed above. Their decisions will be critical to an analysis of statutory coverage in the new world of remote work.
Robert Whitman is a partner at Seyfarth Shaw in the firm’s labor and employment department. Daniel Small and Bernie Olshansky are associates in the firm’s labor and employment department. Paxton Moore is an associate in the firm’s litigation department.
This article will appear in a forthcoming issue of the Labor and Employment Law Journal, the publication of NYSBA’s Labor and Employment Law Section. For more information, please visit NYSBA.ORG/LABOR.
[1] 15 N.Y.3d 285, 291 (2010); see also Wolf v. Imus, 110 N.Y.S.3d 796 (Table), at *2 (Sup. Ct. N.Y. Cnty. 2018) (“The Court of Appeals, in Hoffman, expressly concluded that, except for non-residents working in New York, these two statutory schemes do not protect non-residents of the State.”).
[2] Hoffman, 15 N.Y.3d at 288.
[3] Id. at 290-91.
[4] 145 N.Y.S.3d 30, 30-31 (1st Dep’t 2021); see also Wolf, 110 N.Y.S.3d 796, at *2 (“As Wolf is neither a resident of, nor employed in, the City or State of New York, his claims under both the NYSHRL and the NYCHRL are dismissed.”).
[5] Pakniat, 145 N.Y.S.3d at 31.
[6] Id. (citing Hoffman, 15 N.Y.3d at 292).
[7] 2022 WL 1173433, at *6 (S.D.N.Y. Apr. 20, 2022) (rejecting “suggestion that an employee’s expectation of future work in New York might allow that employee to gain the protection of New York’s human rights laws”).
[8] Id. at *1-2.
[9] Id. at *4.
[10] Id. (quoting Kraiem v. JonesTrading Inst. Servs. LLC, 492 F. Supp. 3d 184, 199 (S.D.N.Y. 2020)).
[11] Id. at 3 (citing Hoffman, 15 N.Y.3d at 292).
[12] See Hardwick v. Auriemma, 983 N.Y.S.2d 509 (1st Dep’t 2014).
[13] Id. at 510-11.
[14] Id. at 512.
[15] Id. (citing Hoffman, 15 N.Y.3d at 290-91; Robles v. Cox and Co., Inc., 840 F.Supp.2d 623, 623-24) (emphasis added).
[16] Id.
[17] Syeed v. Bloomberg, 58 F.4th 64 (2d Cir. 2023).
[18] 2024 WL 1097279, 2024 N.Y. Slip Op. 01330 (N.Y. Mar. 14, 2024).
[19] Id. at *2.
[20] Id. at *3.
[21] Id. at *4.
[22] Id. at *3 n. 2.
[23] Schulman v. Zoetis, Inc. et al., 2023 WL 4539476, at *1 (D.N.J. July 14, 2023).
[24] Id.
[25] Calabotta v. Phibro Animal Health Corp., 460 N.J. Super. 38, 213 A.3d 210 (2019).
[26] Schulman, 2023 WL 4539476 at *2.
[27] Id. at *2 (citing Calabotta 213 A.3d at 214).
[28] Id.
[29] Calabotta 213 A.3d at 214.
[30] Id.
