As of January 2, 2025, the Second Circuit’s decision in CompassCare v. Hochul has revived Section 203-E of New York’s Labor Law. The reinstatement of Section 203-E requires employers in New York to incorporate specific provisions in their employee handbooks concerning reproductive health. Below is a discussion of the Second Circuit’s decision and how it impacts employers.
New York’s Labor Law Section 203-e
Section 203-E was enacted in November 2019 to protect employees from negative employment consequences based on their reproductive health care decisions. It prohibits employers from discriminating against or retaliating against employees regarding pay, job conditions, hiring, or employment benefits due to the employees’ reproductive health choices. Reproductive health choices include using specific medications, devices, or medical services. The law requires that this information and available remedies be included in an employee handbook.
Challenges to Section 203-E
Various religious organizations brought a lawsuit challenging Section 203-E and stating the handbook requirement violated their First Amendment rights. In March 2022, the U.S. District Court for the Northern District of New York enjoined the law after finding that the handbook requirement violated the First Amendment by compelling speech that conflicted with the plaintiff’s religious beliefs.
Second Circuit’s Decision
The Second Circuit in CompassCare v. Hochul has now lifted this injunction. The Court held that the handbook requirement did not violate the First Amendment because it was a rational and neutral employment regulation. The Second Circuit also held that the notice requirement did not interfere with the plaintiffs’ greater message and mission. The notice was categorized as a disclosure of “basic nature” and an expression of employee rights, similar to many other mandatory postings or notices in the workplace.
Expressive Association Rights
The Second Circuit did not completely shut the door to an employer’s ability to challenge 203-E. In a 2023 case, Slattery v. Hochul, the Second Circuit had previously held that an employer could maintain an expressive associational rights claim if Section 203-E forced them to employ individuals who have acted or may act against the “very mission” of the employer’s organization. An expressive associational rights claim is a legal argument that a person or group can associate with others based on their shared beliefs. This claim rests on the notion that the individual’s association is a form of protected speech under the First Amendment, thus allowing them to potentially exclude individuals who would undermine their expressed message or purpose.
To prove this claim, courts will assess the importance of the employee’s role. First, a court will determine whether the employee’s duties require them to interact directly with clients or publicly represent the employer. Second, a court will assess whether the actions or beliefs of the employee conflict with the employer’s purpose or values, so much so that hiring them would harm the organization’s ability to carry out its mission.
Takeaway
In light of the Second Circuit’s decision, employers are urged to immediately update their handbooks to comply with the re-implemented provision of Section 203-E. This notice of employee rights may be contained directly in handbooks or an addendum of New York policies. Employers with a specific mission or religious association may have a basis to contest regulations that compel them to retain employees whose conduct contradicts with their core mission. However, these claims must be clearly articulated, and specific evidence must be provided showing how Section 203-E directly undermines the organization’s objectives.