OUT OF STATE, OUT OF LUCK: New York federal court dismisses New York State and City discrimination claims by remote worker in New Jersey

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Patricia Tsipras

May 25, 2022

In a recent case out of the Southern District of New York – Shiber v. Centerview Partners LLC, 21 Civ. 3649 (ER) (S.D.N.Y. Apr. 20, 2022) – the court was faced with the question of whether a resident of New Jersey, who worked solely in New Jersey due to the COVID-19 pandemic for a New York company, could assert employment claims under the New York City Human Rights Law or the New York State Human Rights Law.  The court applied the long-standing “impact” requirement and ruled that she could not maintain such claims.

Case Background
Kathryn Shiber was employed by Centerview, an investment bank and advisory firm with offices in New York, in a three-year analyst program.  Shiber started the job in July 2020, working remotely from her New Jersey home.  However, she understood that the remote work arrangement was temporary due to the COVID-19 pandemic, and that she eventually would be working in person in Centerview’s New York City offices.

Approximately two months after Shiber started the job, Centerview terminated her employment.  Shiber alleges that her termination followed her request for an accommodation, which she made in light of an anxiety and mood disorder.

Shiber asserted claims against Centerview under the New York City Human Rights Law and the New York State Human Rights Law, among others.  Centerview responded by arguing that the Court lacked subject matter jurisdiction over Shiber’s New York claims because she is a New Jersey resident who worked at all times from her New Jersey home.

The Court Agrees with Centerview
The could held that, to state a claim under the Human Rights laws of New York State or New York City, a non-resident plaintiff, like Shiber, must allege that the discriminatory conduct had an impact in New York State or City.  Because Shiber, at all relevant times, worked from her home in New Jersey and because she could not demonstrate an impact in New York City or New York State, her claims under the New York Human Rights Laws were dismissed.

The fact that Shiber expected to work for Centerview in New York City at some point in the future was not sufficient to satisfy the impact requirement.  The court cited one of its previous decisions to hold that relying on unspecified future career prospects to satisfy the impact requirement would represent an impermissible broadening of the scope of the Human Rights Laws.

The court also rejected Shiber’s argument that it should consider the impact of the COVID-19 pandemic and the fact that remote work arrangements have upended the traditional work-from-the-office assumption upon which previous decisions were based.  However, the court noted that, at no point during the pandemic did the New York City Council or New York State Legislature amend the human rights laws to render the impact requirement inapplicable or to make an exception for out-of-state employees working remotely because of the pandemic.

Employer Take-Aways
The COVID-19 pandemic has permanently changed long-standing workplace norms and practices.  Now, courts are faced with deciding how employment laws created under the assumption of a traditional in-person work arrangement can apply to an increased number of remote and even out-of-state working arrangements.

The Shiber case affirms that the jurisdictional test is whether the impact of the alleged conduct was felt in New York.  However, Shiber does not offer clear answers for other situations – situations that the court noted in its opinion.  For example, if Shiber had worked in New York before the pandemic, or if her work was not completely remote, she may have been able to show an impact in New York.

Employers have to consider where their employees live and work.  Though Centerview may have escaped scrutiny under New York State and City laws in this case, it is likely that they will face scrutiny under New Jersey laws, as well as the laws of other states in which they employ individuals.

 

*Special thanks to Claire Miller, our intern from the University of Notre Dame, for her contributions to this article.

 
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