New York State is the epicenter of the nation’s COVID-19 pandemic, and its response has been arguably more sweeping and aggressive than any other state in the nation. In preparation for the potential emergency, on March 3, at Governor Andrew M. Cuomo’s request, the New York State Legislature passed S. 7919, which amended the state’s Executive Law sec. 29-a to expand the governor’s already broad emergency authority to suspend state and local laws. The law now states that subject to federal or state constitutional limitations or applicable federal law, “[T]he governor may by executive order temporarily suspend” any state or local law during an emergency “if compliance with such provisions would prevent, hinder, or delay action necessary to cope with the disaster or if necessary to assist or aid in coping with such disaster.” The governor also has the power to issue any “directive”—a term not defined, but functionally an order—“necessary to cope with the disaster” and may “provide for procedures reasonably necessary to enforce such directive.” The state’s Executive Law contains a few procedural limits and requirements for exercising these powers, including limiting the time period for such suspensions or directives to 30 days—though the governor can extend such suspensions or directives for additional 30-day periods indefinitely. For suspensions of law, the governor must “specify the statute, local law, ordinance, order, rule or regulation or part thereof to be suspended.”
Armed with this broad authority, and willing to deploy it aggressively, Governor Cuomo declared a state of emergency on March 7 and has issued nine executive orders (EOs) since then suspending or modifying dozens of state and local laws and issuing numerous directives to aid the state’s response. This alert reviews the governor’s work-from-home directives, contained within Executive Orders 202.6, 202.7 and 202.8, issued on three successive days from March 18–20.
Given the importance of “social distancing” in arresting the spread of the coronavirus, and the challenges inherent in adopting such practices in localities like New York City with high population density, on March 18 the governor issued Executive Order 202.6, which among other things mandated that all businesses and nonprofits with operations in the state utilize work-from-home or telecommuting policies for at least 50% of their workforce. The order further directed Empire State Development (ESD), the state’s job creation arm, to publish guidance further explaining the work-from-home mandate and to create a process for non-essential businesses to appeal and be deemed “essential,” thus not subject to the directive.
The next day, the governor issued Executive Order 202.7, overriding the 50% requirement—which had yet to take effect—and increasing it to 75%. And then, on March 20, he signed Executive Order 202.8, mandating all employees of non-essential businesses work from home, effective March 22 at 8 p.m. The work-from-home provisions comprise only a portion of the respective orders, which contain numerous other significant mandates; for example, Executive Order 202.8 includes a suspension provision tolling all state law statutes of limitation and court filing deadlines for 30 days, as well as a directive prohibiting residential and commercial foreclosures and evictions for 90 days.
The governor’s work-from-home directives contain some broad exceptions, several of which have been modified since the issuance of Executive Order 202.6 on March 18. The most important modifications relate to the concept of essential versus non-essential businesses and how the staff and vendors of such businesses are impacted by the order.
For example, from the outset, the governor sought to exempt “essential businesses” from the work-from-home requirement; Executive Order 202.6 included a series of industry exemptions, including for healthcare facilities, grocery stores, and “banks and related financial institutions.” The Executive Order did not limit the percentage or type of employees of such essential businesses that would be exempt, but the ESD’s guidance specified that employees of essential businesses who perform non-essential functions are not themselves exempt.
Conversely, along with increasing the work-from-home requirement from 50% to 100% of a non-essential business’s workforce, the governor in Executive Order 202.8 also exempted “[a]n entity providing essential services or functions whether to an essential business or a non-essential business” as such entity “may operate at the level necessary to provide such service or function.” While this sentence is focused on “an entity” rather than “employees” providing essential services, this language appears intended to enable a non-essential business that has transitioned its primary work force offsite to have a limited number of on-site staff who serve essential functions (e.g., security for the business’s physical location). The state’s rules also now clarify that businesses with employees that remain on-site must comply with New York State Department of Health rules for keeping a clean and safe working environment, including by ensuring workspaces allow for at least six feet of social distance among staff.
ESD’s guidance concerning which categories of businesses or services qualify as “essential” has also changed over time. For example, ESD’s initial guidance stated that the exemption contained within Executive Order 202.6 for “banks and related financial institutions” included, but was not limited to, “banks,” “insurance,” “accounting” and “payroll.” ESD subsequently updated its guidance to include “services related to financial markets”—a broad phrase that can encompass a variety of securities industry entities. In addition, “hotels, and places of accommodation” have been added to the ESD list of “essential infrastructure.”
Finally, prompted by the growing number of COVID-19 cases in New York, the governor has added an enforcement provision to the directive, stating his intent to impose civil penalties or “mandatory closure” upon non-compliant employers. His most recent executive order, 202.8, specifies that failure by an employer to comply would constitute a violation of unspecified provisions of the state’s Public Health Law, which provides for civil penalties of up to $2,000 per violation ($5,000 for repeat offenders) and injunctive relief. New York Attorney General Letitia James is also encouraging workers to file complaints with the attorney general’s Labor Bureau if they believe their employer is not complying with the governor’s directives.
The governor’s Executive Order 202.8 work-from-home requirement takes effect on March 22 at 8 p.m. and expires on April 19. Yet state health experts predict that the number of COVID-19 cases in New York will not peak for approximately 45 days. It’s therefore likely these work-from-home requirements will be renewed and New York employers will have to operate under these emergency legal restrictions for several months.
