New York City Eliminates At-Will Employment For Most Fast-Food Workers

By Douglas Lipsky

New York City Mayor Bill de Blasio signed into law in January two City Council bills prohibiting fast-food employers from terminating workers or reducing their hours below a certain threshold without just cause, except in certain situations. The new law, which goes into effect on July 4, 2021, redefines the employer-employee relationship by essentially eliminating at-will employment in the fast-food industry.

“A strong, fair recovery starts with protecting working people,” said de Blasio. “These bills will provide crucial job stability and protections for fast food workers on the front lines.”

While the legislation provides additional protections for fast-food workers, it presents significant challenges to businesses navigating the economic hardships wrought by the COVID-19 pandemic.  In any event, the best way for fast-food workers and franchisees covered by the legislation to understand their rights is to consult with an experienced employment lawyer.

What is at-will employment?

New York is an at-will employment state which means that both employee and employer can terminate the employment relationship at any time, for any reason or no reason at all. While employers in at-will relationships can terminate a worker without notice, they cannot terminate employees for illegal, discriminatory reasons.

How New York City’s Just Cause Law Affects Fast-Food At-Will Employment

The first bill, 1415-A, prohibits covered fast-food employers from terminating employees, or indefinitely suspending workers without just cause, after a 30-day probationary period. 

“Just cause” is defined as failing to “satisfactorily perform job duties or engaging in misconduct that is harmful to the fast food employer’s legitimate business interests.” Moreover, unless the employee’s conduct is egregious, employers must utilize a progressive discipline process before terminating the worker. 

The legislation also modifies the city’s existing Fair Workweek Law by requiring fast-food employers to implement scheduling practices that provide workers “with a regular schedule that is a predictable, regular set of recurring weekly shifts the employee will work each work.” 

The new law also prohibits employers from reducing a fast-food worker’s regular hours by more than 15 percent.

The second bill, 1396-A, permits employers to lay off employees for bona fide economic reasons, defined as “the full or partial closing of operations or technological or organizational changes to the business in response to a reduction in volume of production, sales, or profit.”

The legislation also requires layoffs to be done in reverse order of seniority; employers must offer reinstatement of laid-off fast-food workers in order of seniority before hiring new workers.

Finally, the legislation allows fast-food workers to challenge a termination in court or through arbitration and tasks the New York City Department of Consumer Affairs and Workplace Protection with establishing formal arbitration procedures by Jan. 1, 2022. 

Ultimately, employers that violate the new law may be ordered to:

  • Reinstate or restore the hours of the fast-food worker 
  • Pay reasonable attorneys’ fees and costs 
  • Pay back pay, compensatory damages, and any other equitable relief

At this juncture, it is unclear whether there will be legal challenges to the new law. In any event, fast-food workers in New York now have some of the strongest legal protections in the nation. If you believe that you have been fired by a fast-food employer without just cause, it takes an experienced employment attorney to protect your rights.

About the Author
Douglas Lipsky is a co-founding partner of Lipsky Lowe LLP. He has extensive experience in all areas of employment law, including discrimination, sexual harassment, hostile work environment, retaliation, wrongful discharge, breach of contract, unpaid overtime, and unpaid tips. He also represents clients in complex wage and hour claims, including collective actions under the federal Fair Labor Standards Act and class actions under the laws of many different states. If you have questions about this article, contact Douglas today.