United States: The DCA Has Issued Proposed Rules For The New York City Fair Workweek's Predictive Scheduling Laws

Last Updated: October 30 2017
Article by Eli Freedberg and Christine L. Hogan

On October 16, 2017, New York City's Department of Consumer Affairs (DCA)1 promulgated rules that further expand upon New York City's Fair Workweek Law. These proposed rules add new and stringent restrictions on retail and fast food employers' right to craft schedules for their employees. These rules also double down on the onerous regulatory and recordkeeping requirements that fast food and retail employers must follow.2 Written comments on the proposed rules are due on or before 5:00 p.m. on November 17, 2017. The public hearing is scheduled for November 17th at10:00 a.m. at 42 Broadway, 5th Floor, New York, NY 10004.

The DCA split the proposed rules into two new chapters of Title 6 of the Rules of the City of New York. Chapter 14 is devoted to rules applicable to the new predictive scheduling laws for retail and fast food employers. Chapter 15 includes detailed rules that fast food employers must follow when making payroll deductions for employees' voluntary contributions to not-for-profit organizations. This Insight will analyze the rules set forth in Chapter 14. We will discuss the payroll deduction rules in a separate publication.

Predictive Scheduling Rules – Fast Food and Retail Employers

First, the proposed rules provide definitions for certain terms found in the original laws and the new proposed regulations. Of particular significance, the proposed rules define the following terms:

  • The predictive scheduling law applies to retail employers engaged primarily in the sale of consumer goods. "Engaged primarily in the sale of consumer goods" means "greater than fifty percent of sale transactions in a calendar year at one or more locations in the City are to retail consumers."
  • When a retail employer changes a schedule with less than 72 hours' notice, it must directly notify affected retail employees. "Directly notify" means "to deliver to an individual employee."
  • Fast food employers must offer additional shifts to current employees before hiring new employees. An "additional shift" means "a shift not previously scheduled that would be offered to a new fast food employee but for the requirements" of prohibitions contained in the Fair Workweek Law.
  • Fast employers must provide new employees with a good faith estimate of their schedule upon hire. "Good faith estimate" means "the number of hours a fast food employee can expect to work per week for the duration of the employee's employment and the expected days, times, and locations of those hours."

Second, the proposed rules state that the required notice of rights regarding the Fair Workweek Law must be "on 11x17 inch paper and in font no smaller than 12 point." The DCA has not yet published this form notice.

Third, neither fast food employers nor retail employers are permitted to disclose or otherwise post the work schedule of any employee who "has been granted an accommodation based on the employee's status as a survivor of domestic violence, stalking, or sexual assault, where such disclosure would conflict with such accommodation."

Fourth, the proposed rules set forth more specific recordkeeping requirements. Specifically, fast food and retail employers must keep electronic records with the following information: (1) actual hours worked per week; (2) employees' written consent to scheduling changes; and (3) every written schedule. Fast food employers must also maintain records regarding good faith estimates and dates and amounts of premium payments. Upon request, fast food and retail employers must now provide an employee's individual work schedule within 14 days of the request and the most current version of the complete work schedule within one week.

Finally, the proposed rules address the intersection between the DCA and an individual's right to pursue a claim in court. In particular, an employee who initially filed a complaint with the DCA must withdraw that complaint in writing before initiating a lawsuit. An employee who initially filed a complaint with a court must obtain a dismissal without prejudice before filing a complaint with the DCA. And, the withdrawal of a DCA complaint does not preclude the DCA from otherwise investigating, pursuing, or settling a case against an employer based on some or all of the same violations.

Predictive Scheduling Rules – Fast Food Employers Only

The proposed rules also include specific provisions applicable to fast food employers that increase the already complex administrative burden of providing current fast food employees with notice of additional shifts. These new rules also complicate the ability of fast food employers to make last-minute but necessary staffing decisions by requiring them to accept existing employees' offers to work increments of open shifts (as opposed to entire shifts).

With respect to the provisions within the Fair Workweek Law that obligate fast food employers to provide and update a good faith estimate of employees' schedules, the proposed rules further require that employers update their estimate when there is a long-term or indefinite change "as soon as possible and before the fast food employee receives the first work schedule following the change."3 A "long-term or indefinite change" includes, but is not limited to:

  1. "Three work weeks out of six consecutive work weeks in which the number of actual hours worked differs by twenty percent from the good faith estimate during each of the three weeks;
  2. Three work weeks out of six consecutive work weeks in which the days differ from the good faith estimate at least once per week;
  3. Three work weeks out of six consecutive work weeks in which the locations differ from the good faith estimate at least once per week; or
  4. Three work weeks out of six consecutive work weeks in which morning, afternoon, or night shifts differ from the good faith estimate at least once per week. Morning, afternoon, or night shifts differ from the good faith estimate when a shift that was a morning shift is changed to an afternoon or night shift; a shift that was an afternoon shift is changed to a morning or night shift; or a shift that was a night shift is changed to a morning or afternoon shift."4

The Fair Workweek Law also requires fast food employers to offer "additional shifts" to current employees before hiring new employees. The proposed rules, however, add layers of administrative obligations to this notice requirement.

First, fast food employers must notify employees "in writing of the method by which additional shifts will be posted" upon hire and when there is any change to that method of notification.

Second, fast food employers must post the required notice of an additional shift for three consecutive calendar days. If an employer does not have three days before the additional shift starts, then it must post notice "as soon as practicable after finding out about the need to fill the shift" and "any existing fast food employee may be temporarily assigned to work a shift that is during the three-day notice period."5 The proposed rules do not specify whether premium pay would be required; although, presumably, that separate requirement does not change. Then, "as soon as possible" after a fast food employer has filled an additional shift – using the same method that the employer used to communicate the initial offer for the additional shift – the employer must "notify all accepting fast food employees when the offered shift has been filled."

Third, if a fast food employee accepts an additional shift that overlaps with his or her existing shift, "before hiring a new fast food employee, the fast food employer shall award the fast food employee the offered shift in lieu of the fast food employee's scheduled shift."6 However, the employer cannot condition the award of the new additional shift on the employee's agreement to work both shifts.

Fourth, the proposed rules provide that a fast food employer with 50 or more fast food establishments in New York City have a choice of offering additional shifts to "employees who work at all locations in New York City," or only those employees who work "in the same borough as the location where the shifts will be worked." Regardless, the employer must first "award shifts or shift increments to fast food employees currently employed at the location where the shifts will be worked."

The fast food employee may accept: (1) the entire additional shift offered; (2) a part of the shift (called a "shift increment" in the rules); and/or (3) if more than one, a subset of the additional shifts offered. If the employee accepts a shift increment only, then the fast food employer is not required to award that employee the increment "when the remaining portion of the shift is three hours or less and was not accepted by another fast food employee or other fast food employees."7

Fifth, the proposed rules provide that if an employee accepts an additional shift, but that shift would result in the payment of overtime hours, the fast food employer "is not required to award the fast food employee the shift but, before hiring a new fast food employee, must award the fast food employee the largest shift increment possible that would not trigger overtime pay, provided that the remaining portion of the shift was accepted by another fast food employee or is three hours or more."8

Finally, the Fair Workweek law also requires fast food employers to pay schedule change premiums when changes are made to an employee's written schedule. Many employers have asked if they are required to pay schedule change premiums if an employee stays late to complete his or her work. The proposed rules provide guidance and include a 15-minute grace period for fast food employers.9 In other words, if an employee works less than 15 minutes past the identified end of the shift, the fast food employer will not be obligated to pay that employee any schedule change premiums. However, if the fast food employee works 15 minutes or longer past the published end of her shift, the employer will be obligated to issue a schedule change premium payment to that employee.

Recommendations

There is no easy way to cut it. The Fair Workweek Law and the DCA's proposed rules impose a vast array of complex notice and scheduling requirements on fast food and retail employers. Because the effective date of the Fair Workweek Law is approximately one month away, it is imperative that fast food and retail employers work in tandem with their scheduling platform providers, management, and legal counsel to ensure that the proper notices are provided in the required formats and time frames. Failure to abide by the laws could subject retail and fast food employers to costly class action lawsuits and administrative investigations.

Notably, the end is not yet on the horizon. The New York State Department of Labor (NYSDOL) recently concluded a series of hearings in which it solicited testimony from various individuals and interest groups in order to release its own set of predictive scheduling regulations. The NYSDOL has not yet indicated when they will publish these regulations or whether they will compliment or preempt New York City's laws; however, one thing is for certain, the cost and complication of simply doing business in the city has just greatly increased.

Footnotes

1 The DCA is the agency tasked with enforcing New York City's Fair Workweek laws.

2 For additional information about the new Fair Workweek laws, see Eli Z. Freedberg, Christine L. Hogan et al., New York City Enacts Laws Limiting Employers' Flexibility To Staff Employees, Littler Insight (Jun. 2, 2017).

3 The proposed rules do not consider a change of 15 minutes or less to be a long-term or indefinite change.

4 "(i) Morning means 4:00 am to 11:59 am. (ii) Afternoon means 12:00 pm to 7:59 pm. (iii) Night means 8:00 pm to 3:59 am." Furthermore, "a shift shall be considered a morning, afternoon, or night shift based on when at least 50% of the shift is worked or scheduled to be worked."

5 The DCA provides the following example: "On Wednesday at 9 am, a fast food employer receives a call from a fast food employee who tells her that she is quitting and she will not report for her regularly scheduled shift on Friday at 9 am. The fast food employer knew of the need to fill the shift 48 hours (or two days) in advance. The fast food employer may assign another existing fast food employee to the shift on the first Friday, but must post the available shift with three days' notice to its employees and assign [the] subsequent Friday 9 am shift to its existing fast food employees in accordance with its criteria in accordance with Section 20-1241 of the Fair Workweek Law and these rules before hiring a new employee."

6 The DCA provides the following example: "A fast food employee's work schedule includes a shift on Mondays from 7 am to 3 pm. The fast food employer notifies employees of an additional shift on Mondays from 9 am to 5 pm, a shift that overlaps with the fast food employee's existing shift. The fast food employee accepts the shift because it will allow the employee to drop the employee's child off at school in the morning without reducing the employee's overall hours. The fast food employer must award the additional shift to the fast food employee before hiring a new fast food employee for the additional shift, provided the fast food employee otherwise meets the employer's criteria for distribution of the shift."

7 The DCA provides the following example: "A fast food employer notified employees of an additional shift on Saturdays from 1 pm to 9 pm, an eight-hour shift. A fast food employee informs the employer that she can work from 3 pm to 9 pm, a six-hour shift increment. Two hours remain in the additional shift and no other employee accepted the remaining two hours. Therefore, the employer need not award the six-hour increment to the employee."

8 The DCA provides the following final example: "A fast food employer offers a shift on Wednesday from 12 am to 6 am to its employees. A fast food employee who is scheduled to work 37 hours during the week accepts the additional shift. The employer must award at least three hours to the fast food employee but is not required to award the entire six-hour shift to the employee because working more than forty hours would result in the employee becoming eligible for overtime pay."

9 The DCA provides the following example: "A fast food employer provides a fast food employee with a schedule that includes a shift on Tuesday from 12 pm to 5 pm. At approximately 5:00 pm on Tuesday, the fast food employer asks the fast food employee to work a few minutes more to assist with a large tour group that just came to the fast food establishment. She agrees and finishes the work at 5:12 pm. The fast food employer need not pay her the schedule change premium.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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