New York State Passes Significant Sexual Harassment Legislation: New Legal Requirements Include Prohibiting Non-Disclosure Clauses Unless It Is the “Complainant’s Preference,” and Barring Pre-Dispute Arbitration Clauses for Sexual Harassment Claims

Sullivan & Cromwell LLP - April 23, 2018

The 2018-2019 State Budget that was recently signed into law by New York Governor Andrew Cuomo contains several significant provisions addressing workplace sexual harassment. Those changes include: 1) a ban on pre-dispute agreements requiring arbitration to resolve sexual harassment claims “except where inconsistent with federal law” (and as noted below, the Federal Arbitration Act may preempt this prohibition); 2) a requirement that any confidentiality provision in a sexual harassment settlement agreement be at the “complainant’s preference,” that such preference be memorialized in the settlement agreement, and that the complainant be afforded a 21-day consideration period and seven-day revocation period for any such agreement; 3) a provision extending employer liability for sexual harassment experienced by independent contractors and other non-employees in an employer’s workplace; 4) a requirement that all New York State employers (regardless of size) adopt anti-sexual harassment policies and training programs to be promulgated by the Department of Labor or that otherwise meet or exceed certain specified legislative requirements; and 5) a requirement that all State contractors certify when submitting a bid for a State contract that they have adopted anti-sexual harassment policies and training programs. The Bill also requires State officials to reimburse the State or any State agency for amounts paid to a plaintiff based on a finding of intentional wrongdoing in claims of sexual harassment.