Throughout 2022, economists have warned of a recession, and many companies are preparing to make wide-sweeping layoffs in anticipation of the economic downturn. Business owners and CEOs have been limiting their projects, reducing new job hires, and terminating employees to reduce costs and volatility. Businesses may use the recession as an excuse to engage in unlawful termination and discrimination, also called recessionary discrimination.
If your employer has terminated your position because of the recession, but you suspect you were fired in a wrongful termination, you need an experienced attorney on your side. Employers cannot use the recession as cover for engaging in unlawful discrimination based on the employee’s employee’s age, sex, gender identification, religion, disability, and membership in other protected classes. Additionally, employers can’t violate your employment contract when terminating your position. Contact the experienced employment attorneys at Lipsky Lowe LLP today to schedule a case evaluation and learn more about your legal rights.
Wrongful Termination During a Recession
New York is an at-will employment state. Generally, employees can be laid off without warning at any time, for any reason or no reason. Massive layoffs during a recession may seem unethical or immoral, but in most cases, they are lawful. Terminating a person’s employment because of an economic downturn is a legitimate and legal reason to fire an employee in New York. However, there are a few important exceptions to this general rule. If your employer falls into one of these exceptions, and you’ve been terminated, you may have a legal claim for wrongful termination.
If you have a New York City union contract, your employer can terminate your employment for specific reasons. Your union contract will specify the reasons you can be terminated. These terminations are called for cause terminations, and you can’t be laid off. Consult with a union representative and an attorney.
Layoffs Cannot Violate Employee Handbooks or Contract
Similarly, employers cannot lay off groups of employees in violation of their employee handbook or manual. When an employee handbook or manual outlines specific reasons and procedures that need to happen before an employee can be fired, employers must adhere to those guidelines. For example, employers must follow this requirement if the handbook states that employees must be given a written warning or some sort of investigatory procedure before they are terminated.
The New York Department of Labor has viewed New York employee handbooks and manuals as written contracts between an employer and employee. When an employer does not adhere to the steps in the manual, the employer may be determined to have breached his or her contract with the employee. The employer may have a legal claim against the employer for breach of contract. Similarly, if you have signed an employment contract and you have been laid off in violation of that contract, you will have a valid claim against your employer under contract.
Recessionary Discrimination Is Unlawful
The term recessionary discrimination became popular after the 2008 financial crisis. The term describes employees laid off in huge numbers because of the recession. Many large employers laid off thousands of workers, claiming they were doing so because of the economic downturn. However, many workers who should have otherwise been protected, such as pregnant women, had a valid claim for unlawful termination.
As we look ahead to another recession, companies across all sectors, including entertainment, banking, and technology, have announced layoffs due to the poor economy. We can anticipate that some of the layoffs may constitute unlawful discrimination. In many cases, layoffs are not based on objective criteria but solely on the manager’s discretion. Managers may be more susceptible to discriminatory decision-making because of implicit biases against certain groups of employees.
For example, they may have an implicit bias against working parents, assuming they are not putting in as many work hours as other employees. That bias could result in them terminating working parents at a higher rate than other employees in violation of New York employment law. Even though the manager may not have a discriminatory intent to terminate pregnant women in large numbers, the layoff effect could be unlawfully discriminatory.
Employers May Use the Recession As an Excuse to Retaliate Against Employees Through Termination
Even when layoffs are based on objective criteria, certain protected categories of employees may be more likely to be laid off. For example, selecting workers for termination based on their prior performance reviews may have a discriminatory result. In other cases, managers use the recession as an excuse to terminate groups of employees who have filed complaints about discriminatory or unlawful conduct.
Under New York law, it is illegal for employers to take adverse actions against employees who have filed complaints about unlawful behavior. As a result, laying off an employee or a group of employees because they are perceived as troublesome for complaining about unlawful behavior is illegal. Suppose you suspect you have been laid off because of discriminatory practices or retaliation for complaining about your employer’s unlawful conduct. In that case, it’s crucial that you discuss your case with an experienced attorney.
Recessions Can Lead to an Increase in Discrimination Claims
Recent history shows that workplace discrimination claims tend to rise after a recession. The recession of 2008 resulted in an all-time high of discrimination filings with the equal employment opportunity commission. Victims of discrimination may be more likely to pursue a claim during a recession because it’s more difficult for them to find alternative employment.
Discuss Your Case with an NYC Employment Attorney
If you’ve been laid off during a recession and you suspect unlawful discrimination, working with an attorney can help you significantly. Finding another job may take time and effort. By pursuing a discrimination claim, you can recover compensation to help you financially until you find alternative employment. At Lipsky Lowe LLP, we can help you understand your legal options and negotiate the best settlement agreement possible. Contact the New York City employment attorneys at Lipsky Lowe LLP today to schedule your case evaluation and learn more about your legal options.