New York Steps Up Employment Compliance Oversight
February 2008
The N.Y. State Division of Human Rights is
the administrative agency charged with enforcing New York's Human Rights Law,
which prohibits discrimination in employment based on age, race, creed, color,
national origin, sexual orientation, military status, sex, disability, predisposing
genetic characteristics, religion or marital status.1
by Paul
J. Siegel, Esq. and Ana C. Shields, Esq.
Jackson Lewis
LLP
In the past, the State Division often took years from the time an administrative
complaint was filed to investigate and issue a finding of no probable cause
(dismissing the complaint) or probable cause (which would lead to a "public
hearing" before an administrative law judge). In the great majority of cases,
the State Division based its finding on the parties' written submissions or
a two-party fact-finding conference.
Since Governor Eliot Spitzer appointed new State Division Commissioner Kumiki
Gibson, radical changes have been made. Those changes have resulted in the State
Division's self-described "more aggressive approach" to investigating administrative
complaints of discrimination.2
As a result, the State Division has revised its complaint-investigation practice
by holding lengthier two-party fact-finding conferences (and sometimes only
one-party conferences with the complainant), issuing extensive document/information
production requests (occasionally by subpoena), and being far less willing to
extend submission deadlines.
It also has overhauled its hearing process by effectively eliminating pretrial
conferences in advance of the public hearing, quickly scheduling hearings after
probable cause determinations, and refusing to adjourn public hearings, even
in cases where parties have reached a settlement in principal but still are
negotiating and executing the settlement papers. In this article, we will highlight
the procedures taken by the State Division to effectuate its new approach and
suggest ways employers and their counsel can best navigate future investigations
and hearings for successful outcomes.
Timeliness—The State's Largest Hurdle
The Human Rights Law requires the State Division to complete investigations
within 180 days after the complaint is filed.3 If
"probable cause" is found, the statute requires that the State Division issue
a Notice of Hearing within 270 days of the filing date; hold a public hearing
within 15 days after the Notice of Hearing is issued; and issue a decision within
180 days after the commencement of the hearing (for a total of 465 days from
the filing date). To date, these requirements seldom have been met.
Changes to the Division's Practices and Procedures
While new regulations have not been published, the State Division's recent
actions demonstrate drastic changes to its internal guidelines and procedures.
Some of these are discussed below.
Only Brief Extensions of Time To Reply
While reasonable extensions of time to respond to administrative complaints
were previously granted, the time permitted to gather rebuttal data and to submit
a position statement is now very brief. The N.Y. State Office of the State Comptroller
(OSC) suggests that "no more than 15 days should elapse between Division case
processing activities" to eliminate gaps of inactivity.4
Also, while the practice of permitting delays while the parties privately sought
to conciliate the matter has been discontinued, now, even where parties indicate
that they are working together toward conciliation of a matter, it is unlikely
that an extension of time to respond will be granted.
Aggressive Investigations
Previously, the State Division often limited its investigation to review
of the administrative complaint, Respondent's position statement, and the Complainant's
rebuttal. Respondents rarely were provided with a copy of Complainant's rebuttal
and were not asked to submit a reply. Today, no matter how specific the information
provided by the Respondent, it is unlikely that a determination will be made
without further investigation. Investigators routinely make requests for supplemental
information, comparative data, and responses following Complainant's rebuttal
to the position statement, adding greatly to the cost of defense. The Division
then holds a one- or two-party fact-finding conference, which seem to be more
lengthy and invasive.
Increased Findings of Probable Cause
In 2006 the State Division found probable cause in only 7 percent of cases.
By contrast, in 2007 the State Division found probable cause in 22 percent of
cases.5 In the section below, we discuss strategies
to avoid probable cause findings and solutions for effective hearing preparation
following adverse determinations.
Overhaul of Hearing Procedures
Previously, after a probable cause determination was made, a relatively lengthy
period might pass before the State Division scheduled the preliminary conference(s),
deadlines for conference statements and answers, and the hearing itself. Today,
a more expedited process is utilized.
Preliminary Conferences Have Been Effectively Canceled
Formerly, preliminary conferences served the same function as the initial
court conference, at which discovery issues were addressed, stipulations were
made as to facts or procedural issues, and settlement was discussed. The conference
provided the administrative law judge with the opportunity to evaluate the facts,
confer with counsel for the parties, inquire about the relative strengths and
weaknesses of each party's case, and to schedule hearing dates. That practice
has been eliminated.
Today, the preliminary conference is held on the morning that the public
hearing begins. Without a true preliminary conference, parties independently
must manage the discovery and trial preparation process, without knowing what
the adversary intends to introduce into evidence and who its witnesses might
be. Consideration of settlement proceeds often without the aid of the Administrative
Law Judge. However, many Administrative Law Judges are willing to facilitate
the settlement and discovery process by holding teleconferences with both parties.
This must be done in an exceedingly short timeframe, without any real sense
as to each other's evidence, and under no rules with respect to discovery.
Preliminary Conference Statements Are Replaced with Prehearing Statements
In the past, a preliminary conference statement was due 5 days before the
preliminary conference and well before the hearing. Now, the parties are asked
to submit a prehearing statement 5 days before the hearing, which must contain
the following: (1) issues presented; (2) a list of anticipated witnesses; and
(3) a list of anticipated exhibits. This leaves little time to conduct discovery
or to prepare for trial.
No Adjournments—Period
Even in cases where attorneys are otherwise actively engaged at the time
of the hearing (but not in a "recognized" court appearance), adjournments rarely
are granted. In some cases, even where the parties have reached a settlement
in principle, Administrative Law Judges reportedly are required to proceed with
the adjudicatory hearing until the case is settled and a notice of withdrawal
is submitted by Complainant.
Double-Booking Hearing Dates
Recently, the State Division has begun scheduling multiple hearings on the
same date. For this reason, theoretically a party may appear for a hearing,
fully prepared and ready to testify, only to be advised that they are not going
to be heard until some later date. This need to re-prepare witnesses and for
the hearing will undoubtedly increase costs.
Coping with the State Division's New Procedures
In short, the best practice is to act quickly and to expect that the brief
timeframes are immutable. Upon receipt of an administrative complaint, the employer
and its counsel immediately should:
-
Determine whether there is a conflict of interest in representation (if
applicable).
-
Determine whether any or all of the claims are covered by insurance.
-
Determine whether any or all of the claims are subject to an enforceable
binding or nonbinding arbitration agreement or some other alternative dispute
resolution agreement (which may not cause the State Division to discontinue
or to delay its processing of the complaint).
-
Put an effective "litigation hold" in place to ensure preservation of
documents and electronically stored materials. Conduct a thorough factual
investigation of the allegations and defenses, addressing both the facts
needed to respond to the charge and the evidence needed to present at a
hearing. There's no time for a separate hearing preparation investigation.
-
Avoid raising unnecessary factual disputes in written submissions and
exhibits. It has been the State Division's recent practice to find probable
cause if any disputed fact arises, whether
genuine or material to the allegations or not. Several recent probable cause
findings have made reference to disputed facts, which do not appear to be
material to the allegations, stating that these would be better resolved
at a hearing.
-
Cooperate with State Division in all respects, and be proactive, if possible,
in providing the Investigator with the information he or she needs.
Upon receipt of a probable cause determination, the employer and its counsel
immediately should:
-
Submit FOIL Requests. Make a prompt
request for the State Division's entire file pursuant to the Freedom of
Information Law (FOIL). The State Division's file usually contains Complainant's
intake form, rebuttal to position statement, and other materials gathered
during investigation of the administrative complaint. FOIL requests can
now conveniently be made via electronic submission at the State Division's
website. If a response is not received within 20 days of the request, follow
up immediately.
-
"Reserve" Witnesses. After notice of
a hearing is received, ensure that all necessary witnesses make themselves
available, emphasizing that no adjournments are possible. Expert witnesses
should be retained as soon as possible, especially given the short notice
provided.
-
Commence Discovery. While the Division
will assign counsel to unrepresented parties, it may not do so until shortly
before the hearing. Nevertheless, a subpoena
duces tecum should be served on Complainant immediately after a probable
cause determination is made. Included in the subpoena should be authorizations
for the release of medical and employment records, if relevant, to obtain
those records prior to the hearing.
Conclusion
Recent statistics reveal a marked improvement in the State Division's timeliness
of processing its caseload. In 2007, 46 percent of case investigations were
completed within the recommended 180 day timeframe; 28 percent of the public
hearings were completed within the 465 day recommended timeframe.6
The State Division has demonstrated its commitment to correcting its largest
source of criticism—an untimely processing of administrative complaints. Consequently,
employers and their counsel are spending more and more time completing the investigative
phase of the process by preparing a position statement, gathering information
responsive to the State Division's supplemental requests, preparing witnesses
for fact-finding conferences and attending such conferences.
Costs to employers of the expanded and seemingly more adversarial investigative
phase will most likely increase. In addition, due to the increased number of
probable cause findings, it is far more likely that employers and their counsel
will actually need to engage in discovery and hearing preparation.
Ana C.
Shields is a senior associate in the Long Island office of Jackson
Lewis. Since joining Jackson Lewis, Ms. Shields has practiced exclusively in
the area of employment litigation and has been involved in proceedings before
federal and state courts, the American Arbitration Association, and administrative
agencies. She has advised employers on compliance with various state and federal
laws affecting the workplace. Ms. Shields can be reached at
or
(631) 247-4657.
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