New York City Council Passes Legislation to Curtail Discrimination, Bolster Protections for Unpaid Interns

Mark Goldstein contributed to the content of this post.

New York City lawmakers have infused a new wrinkle into the already-polarizing debate over the use of unpaid laborers. On March 26, the City Council unanimously adopted a landmark bill extending the anti-discrimination provisions of the New York City Human Rights Law (“NYCHRL”) to a new class of workers: unpaid interns. New York City is thus poised to become one of the first municipalities to place employees and interns on equal footing in terms of protection from discrimination, harassment, and other unlawful employment practices.

The Council’s efforts directly rebuke and effectively nullify an earlier federal court ruling that exempted interns from the scope of the NYCHRL. As we more fully discussed here, on October 3, 2013, Federal District Judge Kevin Castel declared that unpaid laborers may not, under any circumstances, pursue claims of discrimination or harassment under the NYCHRL, one of the nation’s most expansive and rigorous workplace ordinances. Judge Castel reasoned that, in the absence of compensation, a worker may not seek relief under or enjoy the protections bestowed by the City law.

In the immediate wake of Jude Castel’s ruling, State Senator Liz Kreuger introduced reactionary legislation, in mid-October, intended to expand the workplace protections afforded by State law to unpaid laborers. Senator Kreuger’s bill, however, remains pending in Albany and has not progressed beyond the committee referral phase. For New York City employers, the fate of that bill is now moot.

Apparently displeased with the bureaucratic logjam in Albany, the New York City Council grabbed the reins on Wednesday, ratifying parallel legislation that extends the NYCHRL’s broad workplace protections to unpaid interns. More precisely, the regulation outlaws discrimination against unpaid interns on the basis of any one of the litany of protected traits enumerated by the NYCHRL. Critically, the law broadly defines an intern as:

an individual who performs work for an employer on a temporary basis whose work: (a) provides training or supplements training given in an educational environment such that the employability of the individual performing the work may be enhanced; (b) provides experience for the benefit of the individual performing the work; and (c) is performed under the close supervision of existing staff. The term shall include such individuals without regard to whether the employer pays them a salary or wage.

The potential ambiguity inherent in this definition may spur debate and compel further clarification from the Council.

Like traditional employees, allegedly aggrieved interns will be entitled to pursue a private right of action under the NYCHRL by instituting a civil lawsuit. Interns who perceive themselves as victims of discrimination may also seek redress with the New York City Commission on Human Rights. The law will take effect 60 days after it is formally endorsed by Mayor Bill de Blasio, who has already vocalized his support.

How Does This Affect My Company?

The bill transforms Judge Castel’s decision, initially hailed by employers, into a short-lived victory. Although it is axiomatic that all workers, regardless of classification or status, should be treated with respect and dignity, employers should immediately consult with counsel regarding the structure, implementation, and risks and rewards of operating unpaid labor programs, especially in light of the new City law. Comprehensive anti-harassment training for managers, and circulation of a revised equal employment opportunity policy, may also be warranted. The only certainty, in an otherwise largely unexplored and untested subset of the employment law field, is that the recent swell of litigation instigated by and involving unpaid laborers shows no signs of subsiding.

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