Most employment relationships are at-will, meaning that both the employer and employee are free to terminate it at any time and for any reason. However, a new proposal could significantly alter the at-will nature of most employment in New York City, by prohibiting employers from firing workers without cause or a “bona fide economic reason.”
What are the possible changes?
If you are an at-will employer in New York City, you are generally free to terminate workers for any reason, unless that reason is unlawful. For instance, an employer may terminate an employee because of their performance or simply because they are not a good fit with the rest of their team.
However, the proposed ordinance would require an employer to have “just cause” for firing an employee. “Just cause” would include an employee’s:
- Egregious failure to perform job duties or
- Misconduct materially damaging to the employer
Additionally, employers would be required to utilize a progressive discipline plan, implementing various degrees of consequence for failure to adequately perform the job. To support a termination for just cause, the employee in question must have been subject to progressive discipline within a year prior to the termination and must have been informed of the progressive discipline policy.
If an employer does not have just cause, they can still lawfully terminate an employee if there is a “bona fide economic reason” for doing so. Shifts or closures in operations or a dramatic reduction in sales or production for two subsequent quarters would constitute bona fide economic reasons for job eliminations.
The proposal would also put strict limits on the use of electronic monitoring to gather data to discipline or terminate a worker. Employers who do use electronic monitoring for these purposes would be required to do the following in advance:
- Provide notice of any electronic monitoring to employees
- Use the least invasive method for monitoring
- Prove that electronic monitoring is the most practical way of assessing and measuring employee performance
Failure to meet these criteria could trigger legal action against an employer.
What this could mean for NYC employers
The proposed changes would shift the balance between employers and employees, protecting employees from sudden and unexpected changes in their employment. Employers may need to revise their workplace policies, overhaul monitoring practices, and establish a progressive discipline system.
We will continue to follow any developments in this proposal, as the outcome will significantly affect workers and employers across the city.