By Pamela Q. Devata , Robert T. Szyba, and Stacey L. Blecher

Seyfarth Synopsis: On May 4, 2017, New York’s highest court, the Court of Appeals, held that the New York State Human Rights Law (NYSHRL) prohibits employers from discriminating on the basis of criminal conviction history. Entities that are not direct employers may also be liable, however only for aiding and abetting a violation of the NYSHRL.

In Griffin v. Sirva, Inc., the U.S. Court of Appeals for the Second Circuit (Second Circuit) posed three questions to the New York Court of Appeals (Court of Appeals), New York’s highest court, regarding the appropriate interpretation of New York state law, the NYSHRL. Specifically, the Court of Appeals was asked to determine whether (1) Section 296(15) of the NYSHRL, which prohibits discrimination against individuals with prior criminal convictions, is limited to a party’s “employer”; (2) if so, is an “employer” only a “direct employer,” or can the coverage extend to other related entities; and (3) does Section 296(6), which provides for aiding and abetting liability, apply to Section 296(15) to impose liability on out-of-state entities that may have a connection to an in-state employer?

As background, the direct employer in the case was Astro Moving and Storage Co., who was a contractor for Allied Van Lines. Plaintiffs had convictions for sex crimes with minors, which disqualified them from working for Allied, and Astro terminated their employment because they could not perform services for Allied.  Plaintiffs sued Astro, Allied, and Sirva, Inc. (Allied’s parent).  Among other claims, Plaintiffs alleged discrimination due to their criminal conviction histories, as prohibited by Section 296(15) of the NYSHRL.  As is most relevant here, they sued Allied (which was not their direct employer).  Thus, since the interpretation of the NYSHRL had not been resolved on this point, the Second Circuit certified its questions to the Court of Appeals.

In its response, the Court of Appeals held definitively that Section 296(15) of the NYSHRL is limited to direct employers. Although the statutory text states that “any person” is prohibited from discriminating, the Court nevertheless found that this language was contextually designed to target direct employers.

With respect to the second question, the Court of Appeals clarified who the NYSHRL considers an “employer.” To make the determination, the Court of Appeals turned to the common law test for determining the employer-employee relationship, as enunciated by New York’s Appellate Division, Fourth Department, in State Div. of Human Rights v. GTE Corp., 109 A.D.2d 1082 (4th Dept. 1985).  The test consists of four factors: “(1) the selection and engagement of the servant; (2) the payment of salary or wages; (3) the power of dismissal; and (4) the power of control of the servant’s conduct.”  The primary focus on this test, the Court of Appeals quoted the Fourth Department, is the “right of control, that is, the right of one person, the master, to order and control another, the servant, in the performance of work by the latter.”  This pronouncement is noteworthy in that it clarifies the definition of “employer” for NYSHRL claims.

Last, the Court of Appeals turned to the breadth of liability for aiding and abetting, under Section 296(6). The Court noted that one does not need to be a direct employer, or have any employment connection to the plaintiff. The Court pointed out, for example, that in National Org. for Women v. State Div. of Human Rights, 34 N.Y.2d 416 (1974), a newspaper company had no employment relationship with the plaintiff, but was nevertheless found to have aided and abetted discrimination by running two sets of help wanted ads: a separate list of jobs for men, and a separate list of jobs for women, despite the fact that the newspaper did not employ anyone from these ads. The Court also noted that the NYSHRL has an extraterritoriality provision that captures out-of-state actors when their acts have an impact within the state. Thus, an out-of-state entity can be liable for acts that constitute discrimination, or aiding and abetting, that have an impact in New York.  This interpretation is not a change in the lower court’s opinions, but an affirmation that  third party entities should understand that if they have control over hiring decisions, they could be at risk.

Outlook and Potential Ramifications

The Court of Appeals has made certain clarifications that have a potential impact on any employer, as well as any entity who works with another entity that is an employer, where questions surrounding criminal background checks come up that have an impact on employees in New York. Beyond direct employers, who are directly covered by Section 296(15), non-employers, even those outside New York, may nevertheless find themselves ensnared in a claim under the NYSHRL for aiding and abetting. Thus, the ramifications of this decision extend beyond the universe of direct employers, and beyond New York’s state lines. Employers within New York would be well-served to revisit their compliance requirements with Section 296(15). Further, any companies who does business with a New York employer, regardless of whether the company is located in or outside of New York, would likewise be well-served to review their business practices for any “impact in New York” that might run afoul of the NYSHRL.

Those with questions about these issues or topics are encouraged to reach out to the authors, your Seyfarth attorney, or any member of the Background Screening Compliance & Litigation Team.

 

By Paul Galligan and Samuel Sverdlov

iStock_000042612884_MediumSeyfarth Synopsis: The District Court of the Southern District of New York granted an employer’s motion for summary judgment on an employee’s failure to accommodate claims, holding that the plaintiff did not hold a bona fide religious belief, and failed to provide notice to the employer regarding his need for religious accommodation.

Requests for religious accommodations are challenging for employers because employers have limited means to determine the veracity of an employee’s religious obligations, yet risk liability for discrimination and retaliation under federal, state, and local laws if they outright refuse to accommodate an employee’s request for religious accommodation. In fact, more often than not, employers take an employee’s purported religious obligations at face value rather than asking the employee to justify their obligations.  In Bob v. Madison Security Group, Inc., the District Court for the Southern District of New York granted an employer’s motion for summary judgment on a pro se Plaintiff’s claims of failure to accommodate, retaliation, and unlawful termination under Title VII of the Civil Rights Act of 1964 (Title VII), New York State Human Rights Law (NYSHRL), and the New York City Human Rights Law (NYCHRL).

In Bob, the plaintiff was a Muslim security guard employed by Madison Security Group (Madison).  The plaintiff alleged that Madison refused to accommodate his religious beliefs – that he could not work on Fridays to observe the Sabbath.  The plaintiff alleged that despite his religious needs, the employer continued to schedule the plaintiff for Friday shifts.  When the plaintiff failed to report to any shifts that included hours on a Friday, his schedule was reduced and ultimately eliminated (though the employer contended that they have never formally terminated the plaintiff’s employment).

Madison denied any wrongful conduct, and moved for summary judgment on all of the plaintiff’s claims. With regard to the plaintiff’s failure to accommodate claim, Madison challenged whether the plaintiff actually held a bona fide religious belief preventing him from working on Fridays, and averred that in any case, they did not have notice of the plaintiff’s need for religious accommodation.

The court granted the employer’s motion. The court was convinced that the plaintiff did not hold a bona fide religious belief, given that Madison produced records from the plaintiff’s prior employer showing that the plaintiff regularly worked 8-hour days on Fridays, and the plaintiff himself testified during deposition that he could work on Fridays, but prefers not to.

The court was also persuaded that the plaintiff never put Madison on notice that he required a religious accommodation. The plaintiff alleged that he told his interviewer that he could not work on Fridays when he applied for the job, but Madison put forth evidence that they never employed the interviewer identified by the plaintiff.  Further, although the plaintiff often wrote to Madison to complain about working conditions, he never complained about being scheduled to work on Fridays.

Outlook

Although the employer prevailed in this case, employers generally should be cautious and risk- averse when dealing with employee requests for religious accommodation. Employers must remember that they have an obligation to reasonably accommodate religious requests absent an undue hardship, which can be difficult to establish.  Accordingly, we advise that employers engage in, and carefully document, the interactive process with employees requesting such an accommodation.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of the Firm’s Absence Management and Accommodations Team.

By Esther Slater McDonald

Seyfarth Synopsis: The New York Court of Appeals’ ruling on questions regarding the use of criminal convictions in hiring will impact employers and may impact the background screening industry, the temporary staffing industry, and other businesses requiring its affiliates or contractors to adhere to certain criminal history guidelines.

In Griffin v. Sirva, Inc., 835 F.3d 283 (2016), the United States Court of Appeals for the Second Circuit certified several questions to the New York Court of Appeals, seeking clarification on provisions of the New York States Human Rights Law relating to consideration of criminal convictions in hiring.

The Background Facts

Trathony Griffin and Michael Godwin worked for Astro Moving and Storage Company, a company providing local warehouse and transportation services in New York. Astro had an agency contract with Allied Van Lines to provide household moving services on behalf of Allied.  Pursuant to the contract, all Astro employees working on Allied jobs were required to pass criminal background checks.  Allied engaged a third party to conduct the background checks and to apply Allied’s adjudication guidelines.  Under Allied’s guidelines, a felony conviction for any sexual offense disqualified an individual from working on Allied jobs.  That disqualification applied only to Allied jobs; it did not prohibit an individual from working for Astro on non-Allied jobs.

Griffin and Godwin were employed by Astro. At some point, Astro required them to undergo background checks so that they could continue to work on Allied jobs.  The background checks revealed that both men had been convicted of felony sexual offenses and were designated as “Sexually Violent Offenders.”  According to Griffin and Godwin, Astro terminated them after receiving their background reports.

Sometime later, Griffin and Godwin sued Allied and Sirva, Inc., a holding company related to Allied, alleging that they had violated the New York State Human Rights Law by denying them employment because of their criminal convictions or, alternatively, by requiring Astro to deny them employment because of the convictions.

The New York State Human Rights Law

Section 296 of the New York State Human Rights Law.  Section 296(15) generally makes it unlawful for “any person, agency, bureau, corporation, or association … to deny … employment to any individual” because of a criminal conviction unless there is a direct relationship between the criminal offense and the employment at issue or the employment would involve an unreasonable risk to property or to the safety or welfare of individuals or the general public.  Section 296(6) also makes it unlawful for “any person to aid, abet, incite, compel or coerce” a violation of Section 296(15).

The Litigation

The district court entered judgment for Allied and Sirva.  The district court held that only employers can be liable for denying employment and that, to be liable for aiding and abetting a denial of employment, a business must be a joint employer of the individual denied employment.   The court determined that Allied and Sirva were not “employers” or “joint employers” of Griffin or Godwin.

On appeal, the Second Circuit cast doubt on the district court’s ruling and concluded that the New York State Human Rights Law may apply to Allied and Sirva even though they did not employ Griffin and Godwin. The Second Circuit stated that Section 296(15) applied to “any person, … corporation, or association,” and thus the Section may apply to companies other than employers.  Even if Section 296(15) is limited to “employers,” the Second Circuit concluded that the term “employer” could be read to encompass entities like Allied and Sirva.  Last, the Second Circuit stated that the standard for aiding and abetting liability was unclear and indicated that New York may have intended for the provision to have a broad reach that encompasses non-employers, including contracting parties, regardless of their intent.

Because New York courts have not determined who may be liable under Section 296(15) or addressed the scope of Section 296(6) liability for businesses, the Second Circuit certified the following issues to the New York Court of Appeals for it to decide:

(1) Does Section 296(15) of the New York State Human Rights Law, prohibiting discrimination in employment on the basis of a criminal conviction, limit liability to an aggrieved party’s “employer”?

(2) If Section 295(15) is limited to an aggrieved party’s “employer,” what is the scope of the term “employer” for these purposes, i.e. does it include an employer who is not the aggrieved party’s “direct employer,” but who, through an agency relationship or other means, exercises a significant level of control over the discrimination policies and practices of the aggrieved party’s “direct employer”?

(3) Does Section 296(6) of the New York State Human Rights Law, providing for aiding and abetting liability, apply to § 296(15) such that an out-of-state principal corporation that requires its New York State agent to discriminate in employment on the basis of a criminal conviction may be held liable for the employer’s violation of § 296(15)?

The New York Court of Appeals accepted the certification, and oral argument in the case is expected to occur later this year.

The Takeaway

Employers, staffing agencies, background screeners, and others should be watching Griffin v. Sirva, Inc. How the New York Court of Appeals will rule on the certified questions is uncertain.  The court could interpret Section 296 narrowly to apply only to employers, or the court could interpret the section broadly in a manner that expands liability to non-employers.  Regardless of the outcome, any ruling is likely to provide guidance to employers and others, which will enable businesses to better manage risk.

For more information on this or any related topic please contact the author, your Seyfarth attorney, or any member of the Background Screening Compliance & Litigation Team.