Key Points
- Expanded Leave and Handbook Requirements. New York City has significantly expanded its Earned Safe and Sick Time Act (ESSTA) to include additional qualifying reasons for leave, integrated the Temporary Schedule Change Act and added 20 hours of paid prenatal leave.
- New Safety and Wage Compliance Obligations. The Retail Workers Safety Act, effective June 2, 2025 requires retail employers to adopt workplace violence prevention policies, train employees regularly, and to eventually install silent alarm systems for larger employers. Additionally, minimum wages, tip credits, uniform allowances and exempt salary thresholds will increase on Jan. 1, 2026, requiring updates to pay rate forms and payroll systems.
- Enforcement and Litigation Trends Increasing. New York State and New York City agencies are becoming more aggressive in enforcing employment laws, especially as political leadership shifts in 2026.
As 2026 approaches, employers should review the changes in this year’s legal landscape to ensure that they are continuing to follow the law to date and are prepared for future changes. Surprisingly, in 2025, New York enacted few legal changes that affect employers this year. However, there were a few changes that employers need to know and there are certain trends in the law and by enforcement agencies about which employer should be aware.
In addition, over the last several years New York State and City have been exceptionally active in pursuing actions against employers. Especially in New York City, we anticipate this activism will be more robust in 2026 as Zohran Mamdani takes office as the mayor of New York City.
Legislative Changes Impacting Employer Handbooks
There were a few legal changes in New York about which employers must be aware and which should be incorporated into employee handbooks. If an employer does not update their handbook to account for these policies, they may be in violation of applicable law, especially New York City law.
Earned Safe and Sick Time Act: Permitted Uses Expanded
On Oct. 25, 2025, New York City amended its Earned Safe and Sick Time Act (ESSTA) policies. The amendment becomes effective on Feb. 22, 2026. This amendment created additional qualifying reasons for employees to use paid safe and sick time. Now, employers must provide safe and sick time for the following additional reasons:
- To take certain protective actions when the employee or employee’s family member has been a victim of workplace violence.
- To provide care for an employee’s minor child or “care recipient.”
- By order of a public official due to a “public disaster” that results in:
- Closure of the employee’s workplace.
- The employee’s need to care for a child whose school or childcare provider is closed or restricted in-person operations.
- A directive from public officials to remain indoors or avoid travel.
- To pursue subsistence benefits or housing for the employee, employee’s family member or “care recipient.”
Under the law, a “care recipient” is a person with a disability, including a temporary disability, who (i) is the employee’s family member or resides in the employee’s household and (ii) relies on the employee for medical care or to meet the needs of daily living.
A “public disaster” includes fires, explosions, terrorist attacks, severe weather or other emergencies declared by the U.S. president, New York governor or New York City mayor.
Prenatal Leave
Since Jan. 1, 2025, New York employers have been required to provide employees with up to 20 hours of paid prenatal leave in a 52-week period, in addition to safe and sick leave, under New York City’s ESSTA and New York State’s Sick Leave Law.
Several months later, in July 2025, New York City updated its rules, generally incorporating New York’s prenatal leave requirements into ESSTA while adding further requirements with respect to prenatal leave. An employer’s ESSTA policy must now include its prenatal leave policy. The policy must do the following:
- State the availability of the separate bank of 20 hours of paid prenatal leave per 52-week period.
- State the minimum increment of prenatal leave that may be used at any one time.
- Include other details concerning the use of prenatal leave.
In addition, the policy must include a statement that the employer will not require employees to provide details about the medical condition that led the employee to use prenatal leave and that it will keep any information it does receive about the employee’s use of prenatal leave confidential.
With this update, the City also requires employers to post an updated Notice of Employee Rights, in English and the primary language of at least 5% of employees in the workplace, if such poster is available in that language on the Department of Consumer and Workforce Protection’s website.
Finally, for each pay period, employer pay stubs must reflect prenatal leave usage as follows:
- The amount of paid prenatal leave used during the pay period.
- The total remaining balance of paid prenatal leave for the remainder of the 52-week period.
To remain compliant, New York City employers must ensure that their policies and notices are updated and redistributed to current employees and that their payroll provider has taken steps to ensure that prenatal leave information is displayed on pay stubs during any period it is used by an employee.
Integration of the Temporary Schedule Change Act into ESSTA
In addition, New York City amended ESSTA to bring the New York City Temporary Schedule Change Act under ESSTA’s ambit, effective Feb. 22, 2026. Before the amendment, employers were required to provide employees with up to two temporary schedule changes annually for personal events. Now, employers are required to give employees 32 hours of unpaid safe and sick time each calendar year, which employees may use immediately. However, an employee must specifically request to use this unpaid leave, otherwise employers are required to assume the employee is requesting to use available paid safe and sick time.
Employers may impose a minimum usage increment of up to four hours per day and must separately track and report both paid and unpaid time balances to comply with ESSTA’s notice and recordkeeping requirements.
For all other temporary schedule change requests, employers can now approve, deny or propose an alternative to such a request as soon as practicable. Employers still may not retaliate against employees who make such requests.
Sunset on COVID Leave
On July 31, 2025, New York removed its requirement that employers provide paid COVID Leave to employees who contract COVID-19. Any COVID-19-specific leave policy may now be removed from employers’ compliance documents. However, employers should remain aware that employees who contract COVID-19 may be eligible for paid or unpaid leave under other laws, such as ESSTA.
The end of leave for COVID-19 does not affect the separate requirement that employers comply with the New York Health and Essential Rights (HERO) Act, which requires employers to maintain plans to protect their employees against any future airborne disease outbreaks.
Retail Worker Safety Act
On Feb. 14, 2025, the Retail Worker Safety Act’s (Act) implementation was postponed from March 4, 2025 to June 2, 2025; the requirement of a silent alarm system was delayed until Jan. 1, 2027.
The Act applies to all retail stores within New York. The Act defines a “retail store” to be “a store that sells consumer commodities at retail and which is not primarily engaged in the sale of food for consumption on the premises.” If an employer employs 10 or more employees at a retail store, they are covered by the Act.
The law requires retail stores to adopt and provide a workplace violence prevention policy, in line with the requirements set by the New York State Department of Labor, which can be found here: Retail Workplace Violence Prevention Policy | Department of Labor.
Additionally, employers must train employees regarding workplace violence. This training must meet certain requirements set by the New York State Department of Labor. Employers with 49 or fewer retail employees will have to give the training every two years, and employers with 50 or more employees will have to give the training every year. The training must meet or exceed the requirements of the model policy which can be found here: https://dol.ny.gov/retail-workplace-violence-prevention-training.
Starting on Jan. 1, 2027, retail stores with 500 or more retail workers within New York state will be further required to implement a silent alarm system to help retail workers request assistance during an emergency. Further, employers will be required to train employees on the use of a silent response button.
Nondisclosure Agreements
There is value, particularly in a tight labor market, in requiring a nondisclosure agreement (NDA) for certain employees. Employers should contact a qualified labor and employment attorney to create effective agreements with protective provisions. Employers can protect certain confidential information from disclosure, but they must take the steps necessary to protect what they claim is confidential. Confidential information may vary based on the needs and nature of an employer’s business. In the hospitality industry, for example, an employer may find it beneficial for “confidential information” to include, among other things, information regarding future operations, ventures, financial data, guest lists, signature dishes or formulas.
Some employers may hire skilled chefs or artists to create artwork and recipes for them. Often, these employees leave their employers and take these creations with them to competitors. To maintain their right to these works, employers can include additional provisions in their NDAs and related documents pertaining to works made for hire. With such provisions, employers have been able to encapsulate and protect such creations made by an employee while working for the employer.
While an effective contract provides a means of enforcing an employer’s rights, employer policies may limit the need to enforce the terms of their strong agreements in the first place. Maintaining a positive work environment, respecting employees, taking and addressing their complaints, and meeting salary expectations are all effective means of increasing employee loyalty and making it far less likely that an employer will need to enforce these agreements. While employers can limit turnover to an extent, they cannot prevent it entirely, and therefore, we recommend that employers contact an employment law attorney and maintain strong agreements in the event that enforcement becomes necessary.
Sexual Harassment Training Reminder
Since 2018, employers have been required to conduct sexual harassment training both at the time of hire and annually thereafter. Training must be a regular part of operations. Industry turnover can be high; systems must be in place to ensure that the right information is being relied upon by management and employees.
Not only is training a legal requirement for which noncomplying employers may be penalized, but also, any noncompliance will be used as evidence against employers in a harassment complaint, subjecting employers to punitive damages in court. This year, the City Human Rights Commission and State Division of Human Rights have been much more active, and we expect this trend to continue. Employers must be able to prove that they have been training not just their employees, but also managers, executives, and owners, all of whom may be found liable under certain circumstances.
Group trainings can be an effective means to train managers, executives and owners annually, where the best policies and practices can be discussed as a team. However, we do not advise implementing group training for standard hourly employees.
Wage and Hour Changes: Increased Wages and Requirements
As we approach the start of a new year, New York employers should prepare for several wage-related changes that go into effect on Jan. 1, 2026. Along with an increase to the state’s hourly minimum wage rates, there are scheduled changes to the tip credit, meal credit, uniform allowance and salary exemption thresholds.
It is critical that employers plan ahead for these upcoming changes. Employers are encouraged to work with their payroll team/providers to ensure that their rate of pay forms and pay stubs are compliant with the new rates. Failing to make the necessary changes (including issuing updated Notice of Pay Rate forms to all employees whose pay rates, tip credit or meal credit will be impacted — the Department of Labor’s Notice of Pay Rate forms can be found here: Notice of Pay Rate | Department of Labor) poses a substantial risk of legal liability.
Employers will be required to provide employees with updated rate of pay forms and tip credit policies in accordance with the aforementioned wage and hour changes. If employers do not understand how the tip credit should be reflected in such forms, they should speak with a qualified employment law attorney who can guide the employer.
The minimum wage rate in New York will increase to $17.00 per hour for downstate employees and to $16.00 per hour for upstate employees. The State has also increased wage rates, meal credits, uniform allowance requirements and exempt thresholds for employees across the state. These changes vary based on where in New York the employee works and in what capacity the employee. For more information, a summary of the relevant Wage and Hour changes for 2026 can be found here: New York Employers Face Increases in Wage Requirements in 2026.
Litigation Trends
Uniform Maintenance Pay
There have been an increasing number of lawsuits concerning uniform maintenance pay. Under New York law, if an employer requires an employee to wear a uniform, the employer must either launder and maintain the uniform itself, have the uniform meet certain “wash and wear” requirements, or pay the employee an allowance, also known as Uniform Maintenance Pay, on a weekly basis. The amount of Uniform Maintenance that must be paid depends on how many hours the employee works per week. For more information, a summary of the relevant Wage and Hour changes for 2026 can be found here.
Employers should review their policies and ensure that they are paying their employees the correct amount depending on how many hours each employee works. Further, employers who want to try and take advantage of the wash and wear exception to Uniform Maintenance Pay should consult with legal counsel to determine whether the requirements necessary to satisfy this exception are satisfied.
Meal Credits and Documenting Meals
Plaintiffs have increasingly claimed improper deductions for meal credits when certain obligations have not been met. Most common is the claim that an employer has taken an “automatic meal credit” without actually providing a meal that complies with New York law.
Employers must keep records of meals they provide to employees and the actual cost of such meals. We also recommend that employers require employees to clock out at the start of their meal break and clock in when it is completed, in order to defend against automatic deduction claims.
Employers should also review the meals they provide. Most employers may lawfully take a meal credit against an employee’s wages for each shift that they furnish a meal to the employee, only when the meal consists of at least one of the types of food from each of the four of the following groups:
- Fruits or vegetables.
- Grains or potatoes.
- Eggs, meat, fish, poultry, dairy or legumes.
- Tea, coffee, milk or juice.
In addition to these requirements, employers may be required to provide a halal, kosher or other reasonably accommodating options, depending on requests from one or more employees.
As with uniform maintenance pay and the tip credit, the amount an employer may take for a meal credit is increasing in 2026. For more information, a summary of the relevant Wage and Hour changes for 2026 can be found here.
Overtime
Unpaid overtime is one of the most common claims in wage and hour litigations. Depending on their job duties, certain employees may be exempt from overtime requirements under the law. This typically includes, but is not limited to, executive, managerial and administrative employees. To be exempt from overtime, under New York law, these employees must also be paid a minimum amount per week, depending on the size and location of the employer.
The salary threshold for exempt status is as follows:
New York Salary Exempt Thresholds
Please note, however, an employee’s salary is only one part of determining whether the employee is properly categorized as exempt from overtime requirements. To be exempt, an employer must also satisfy a job duties test. In short, an employer cannot categorize an employee as exempt simply based on their weekly salary. However, if an employer can successfully do so, they can avoid one of the most common types of wage and hour litigations.
Unpaid Commissions
When an employer allows an employee to earn a commission, they must create a written commission agreement that explains exactly how each commission is earned and paid. Additionally, clauses that explain what happens in the event of termination will be key in defending these claims.
Arbitration Agreements
Employers may want to consider which individuals should be subject to an arbitration agreement. An arbitration agreement is not a panacea but does provide some leverage against class and collective actions. When an effective arbitration agreement exists, such actions typically may not be filed in arbitration proceedings absent an agreement from the employer. Employers with arbitration agreements therefore have a choice as to whether or not to defend a class action or to deal with each action individually.
Practical Implications & Next Steps
As a result of the 2026 increases, New York employers should be aware of these changes and trends, and budget labor expenses accordingly. We predict an aggressive and progressive agenda from the State and City that will result in more claims filed against employers. Employers should consult with a qualified labor and employment attorney to ensure they are prepared. The failure to make the necessary modifications could subject employers to significant legal liability, including potential class and collective actions.
[View source.]
