As the new year begins, now is the best time for employers to take inventory of their policies and practices to ensure compliance with the updates listed in this Alert.

In 2025, as in prior years, New York State and New York City enacted a flurry of new laws/ordinances at the end of the year. In this Alert, we provide a general overview of some of the more salient year-end changes as well as previously enacted updates that go into effect this year and in 2027.

Early 2025 Updates, Industry-Specific Developments and 2026 Watchlist

As a reminder, the following updates went into effect earlier in 2025:

• New York State and New York City paid prenatal leave (see our previous Alert);
• The expiration of New York State COVID-19 paid sick leave;
• New York City amendments to the New York City Human Rights Law (NYCHRL) requiring lactation accommodation posting and paid breaks;
• New York State Legislature amendments to Sections 519 and 521 of the Judiciary Law to increase the jury duty fee; and
• New York Labor Law amendments to Section 198(1-a) that limit available damages for a violation of Law Labor Section 191(1)(a) frequency of payments.

Additionally, there are numerous industry-specific measures beyond the scope of this Alert, for example:

• The New York State Title VI coordinator mandate for higher education institutions (Senate Bill S4559B/Assembly Bill A5448B);
• The New York City Council’s passage of bills extending pay and workplace protections to delivery workers (Int. 1133-A and Int. 1135-A);
• The New York State Fashion Workers Act;
• The New York State Retail Worker Safety Act;
• New York State gender-based violence policy requirements for public bidders (Section 139-M of New York’s State Finance Law); and
• The New York State Warehouse Worker Injury Reduction Program.

Finally, key developments we are following include:

• The New York Artificial Intelligence Act (Senate Bill S1169);
• Regulations that may be issued for the New York Trapped at Work Act;
• Regulations that may be issued for the New York City lactation accommodation posting and paid break requirements; and
• The designation of a city agency to which to report employee pay data under New York City Int. 982-A and Int. 984-A.

New York State Updates

New York State Reasonable Accommodation Anti-Retaliation Act

On December 5, 2025, Governor Kathy Hochul signed the Reasonable Accommodation Anti-Retaliation Act (RAAA) into law. Effective immediately, the RAAA amends the New York State Human Rights Law (NYSHRL) to clarify that individuals requesting reasonable accommodations are protected under the NYSHRL’s anti-retaliation provisions.

Prior to the RAAA, employees requesting reasonable accommodations for purposes recognized under the NYSHRL (i.e., disability, pregnancy-related conditions, religious observances and domestic violence victim status) were not expressly protected by the law’s anti-retaliation protections. This resulted in a contradiction under the NYSHRL, whereby employees were entitled to reasonable accommodations under the law while also subject to an arguably lawful termination for requesting a reasonable accommodation in the first place. The RAAA resolved this contradiction by aligning the NYSHRL with its federal and New York City counterparts, each of which specifically prohibit retaliation against persons requesting reasonable accommodations as an unlawful discriminatory practice. The RAAA also responds to prior case law identifying that the NYSHRL should not be construed to prohibit retaliation based on reasonable accommodation requests in the absence of specific language stating the same. See Jordan v. City of New York, Case No. 23cv4962 (DLC), 2024 WL 4872186, at *3 (S.D.N.Y. 2024) (“While the New York City Council amended the NYCHRL to state that a request for a reasonable accommodation is protected activity, the New York State Legislature did not similarly act”).

In light of the above, the RAAA serves as a reminder for employers to ensure that their management training programs include retaliation relative to reasonable accommodation requests, which we have found to be lacking in many programs that we have reviewed.

New York State Restrictions on Use of Consumer Credit History in Employment Decisions

On December 19, 2025, Governor Hochul signed into law Senate Bill S3072/Assembly Bill A1316, amending the New York General Business Law to restrict employers’ use of consumer credit history for employment-related purposes. These amendments will become effective on April 18, 2026—120 days following Governor Hochul’s signature.

Under the amendments, it an unlawful discriminatory practice for an employer, labor organization, employment agency or their agent to request or use an individual’s consumer credit history when making decisions concerning hiring, compensation or other terms, conditions or privileges of employment. The term “consumer credit history” is defined broadly to include information contained in a consumer credit report as well as other information bearing on individual’s creditworthiness, credit standing or credit capacity.

Despite its broad restriction, the amendments recognize limited circumstances in which reliance on consumer credit history remains permissible. The amendments do not apply where the employer or its agent is required by state or federal law or by a self-regulatory organization, as defined in Section 3(a)(26) of the Securities Exchange Act of 1934, to use consumer credit history for employment purposes. In addition, the amendments exempt certain positions, including:

• Applicants for or persons employed as peace officers or in police officer roles or positions with a law enforcement agency that carry a law enforcement or investigative function;
• Positions subject to a background investigation by a state agency where the role is an appointed position involving a high degree of public trust, as further defined by the commission in rules;
• Positions in which an employee is required to be bonded under state or federal law;
• Positions requiring security clearance under federal or state law;
• Certain nonclerical roles with regular access to trade secrets, intelligence information or national security information;
• Positions with signatory authority over third-party funds or assets valued at $10,000 or more, or involving fiduciary responsibility to the employer with authority to enter into financial agreements of $10,000 or more on the employer’s behalf; and
• Positions whose regular duties allow an employee to modify digital security systems designed to prevent unauthorized use of the employer’s or client’s networks or databases.

The amendments also clarify that nothing in the new provisions precludes an employer from requesting or receiving consumer credit history information pursuant to a lawful subpoena, court order or law enforcement investigation, and the new provisions do not alter existing obligations of persons required by state or local law relating to disclosures by public employees of conflicts of interest. Importantly, the amendments do not displace local laws, ordinances or regulations governing the use of consumer credit history for employment purposes, so long as those local enactments afford employees or job applicants greater protection than this new state law.

For New York employers, this new framework will require a careful review of background check practices, particularly any use of credit reports or credit-related data in hiring or promotion decisions.

Accordingly, the amendments bring New York State law into conformity with New York City’s preexisting Stop Credit Discrimination in Employment Act by harmonizing the core prohibition and exceptions.

By way of reminder, other states, districts and territories that restrict an employer’s use of credit reports include Arizona, California, Colorado, Connecticut, District of Columbia, Hawaii, Illinois, Kansas, Louisiana, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Jersey, Oklahoma, Oregon, Puerto Rico, Rhode Island, Vermont and Washington. The New York law is similar but not identical to these other state laws.

New York State Minimum Wage Increase

Effective January 1, 2026, the minimum wage in New York State is:

• $17 per hour for employees in New York City, Nassau County, Suffolk County and Westchester County; and
• $16 per hour for employees in the remainder of New York State.

The executive and administrative overtime exemption threshold minimum salary is:

• $1,275 per week ($66,300 per year) in New York City, Nassau County, Suffolk County and Westchester County; and
• $1,199.10 per week ($62,353.20 per year) for exempt executive and administrative employees in the remainder of New York State.

In addition, on January 1, 2026, the minimum wage and allowable tip credits for tipped employees will be:

• $14.15 cash wage and $2.85 tip credit for service employees in New York City, Long Island and Westchester County;
• $11.35 cash wage and $5.65 tip credit for food service workers in New York City, Long Island and Westchester County;
• $13.30 cash wage and $2.70 tip credit for service employees in the remainder of New York State; and
• $10.70 cash wage and $5.30 tip credit for food service workers in the remainder of New York State.

Employers should review compensation practices and confirm compliance with all applicable wage increases ahead of the January 1, 2026, effective date.

New York State Trapped at Work Act

On December 19, 2025, Governor Hochul signed the New York Trapped at Work Act (TWA) into law. Effective immediately on December 19, 2025, the TWA makes New York the second state in the country, following California, to enact legislation banning “stay or pay” clauses in employment. To read more about the California legislation that initiated this trend, see our earlier Alert.

Under the TWA, employers are prohibited from requiring workers or prospective workers to execute employment promissory notes as a condition of employment. The TWA defines the term “employment promissory note” to include any instrument, agreement or contract provision requiring a worker to pay an employer, or the employer’s agent or assignee, if that worker leaves employment before the passage of a stated period of time. This definition includes those employment promissory notes characterizing such payments as worker training reimbursements.

The employers covered by the TWA are: (a) individuals and entities that hire or contract a worker to provide services; and (b) subsidiaries and entities associated with covered employers that provide training to workers. The TWA defines “worker” to include employees, independent contractors, externs and interns, volunteers, apprentices, sole proprietors and individuals providing services through a business or nonprofit. The term “worker” does not, however, include individuals whose sole relationship with a covered employer is as a vendor of goods.

Despite its broad prohibitions, the TWA is subject to a few statutory exclusions. Specifically, the TWA does not apply to any agreements between a worker and employer that:

• Require worker repayment of payroll advances that were not used for training in connection with employment;
• Require a worker to pay for any employer‑provided property that was sold or leased to the worker;
• Require educational personnel to comply with any terms or conditions of employer-provided sabbatical leave; or
• Are entered into as part of a program agreed to under a collective bargaining agreement.

In addition to these exclusions, the TWA clarifies that inclusion of an employment promissory note in a larger agreement shall not void the entire agreement.

While there is no private right of action for workers under the TWA, employers that violate the TWA are subject to civil penalties. Moreover, under the TWA, an employer that sues a worker to enforce an employment promissory note is liable for the worker’s attorneys’ fees.

Though clearly applied prospectively, the TWA’s statutory text leaves open a question as to whether its prohibitions also apply retroactively. The TWA empowers the New York State Department of Labor commissioner to issue rules and regulations on the TWA, which we anticipate will offer clarity on this open question as well as its application generally. We are actively tracking the issuance of any such implementing rules and regulations, and will discuss these in future Alerts.

New York City Updates

New York City Earned Safe and Sick Time Act Amendments

Recent amendments to the New York City Earned Safe and Sick Time Act (ESSTA) will become effective on February 22, 2026, and alter leave entitlements for employees working in New York City in three major ways.

First, under the amended ESSTA, employees will be entitled to a new unpaid safe and sick leave bank of at least 32 hours. The unpaid 32-hour safe and sick leave bank is separate from and does not impact the accrual, carryover and front-loading rules controlling the ESSTA’s existing 40- or 56-hour safe and sick leave requirements. This new unpaid 32-hour leave bank will be available to employees immediately upon hire and must be frontloaded by employers at the start of each calendar year thereafter. Employers may set a reasonable minimum increment of four hours or less each day for use of the unpaid 32-hour leave bank. The unpaid 32-hour leave bank is subject to the ESSTA’s existing notice obligations. However, an employee’s balance of the unpaid 32-hour leave bank must be maintained and displayed separate from any accrued paid safe and sick leave under the ESSTA.   

Second, the amendments expand the permissible uses of leave under the ESSTA to include reasons related to caregiving for a minor child or other care recipient, attending legal proceedings related to housing or subsistence benefits, recovering from workplace or domestic violence, and workplace closures, school or child-care closures or restricted in-person operations, or public official directives due to a public disaster. The amendments also eliminated most temporary work schedule change requirements under the New York City Temporary Schedule Change Act, though employers remain prohibited from retaliation in connection with employees’ temporary schedule change requests.

Third, the amended ESSTA formally incorporates the New York City Department of Consumer and Worker Protection’s (DCWP) amended rules concerning paid prenatal leave into the ESSTA’s statutory text. As further outlined in our previous Alert, the DCWP’s amended rules integrated paid prenatal leave requirements consistent with New York State law and triggered a few additional compliance obligations for employers. The formal incorporation of the amended DCWP rules into the ESSTA emphasizes the importance of New York City employer compliance with the New York State paid prenatal leave requirements folded into the DCWP rules and the DCWP’s supplemental compliance obligations.

For more information on these ESSTA amendments and their implications for New York City employers, see our previous Alert.

Pay Data Reporting by Private Employers

On December 4, 2025, the New York City Council voted to override a November 7, 2025, veto by Mayor Eric Adams to Int. 982-A and Int. 984-A. Initially passed on October 9, 2025, Int. 982-A and Int. 984-A amend the New York City Administrative Code to require pay data reporting for covered large private employers.

Int. 982-A requires private employers with more than 200 employees working in New York City to submit a pay data report to a designated city agency in order to improve wage transparency. The report would include demographic and occupational information and would need to be submitted annually to the designated city agency via a fillable, electronic form to be developed by that designated city agency.

Int. 984-A requires a designated city agency, in coordination with the Commission on Gender Equity and other relevant agencies, to conduct an annual pay equity study on private employers with 200 or more employees. The study would use the pay data information submitted by employers to evaluate whether there are disparities in compensation based on gender and race or ethnicity. The city agency would be required to submit to the mayor and the speaker of the council a report on the findings of the study. The city agency would also publish the information contained in the pay reports submitted by covered employers.

The requirements in Int. 982-A and Int. 984-A took effect immediately following the New York City Council’s vote on December 4, 2025, however, no employer action is required until a city agency is designated and said city agency creates and circulates the mandated fillable, electronic form. We will continue to monitor developments regarding this agency designation and action.

What This Means for Employers

As the new year begins, now is the best time for employers to take inventory of their policies and practices to ensure compliance with the updates listed above in this Alert. We will continue tracking New York State and New York City employment laws throughout the year and issue further updates on legal developments for employers.

For More Information

If you have any questions about this Alert, please contact Eve I. Klein, Jonathan A. Segal, Katelynn Gray, Gregory Slotnick, Paige Carey, Elizabeth Underwood, any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.