Q: I just finished my residency and received a lucrative employment offer, what are the next steps? A: Congratulations! Unlike other industries, a common practice in the health care industry is to have a written employment agreement. Therefore, the first step in assessing any new employment offer is to carefully review the employment agreement. Although it may be tempting to go about this review on your own, we strongly recommend that you engage an experienced health care attorney to assist with this process. For you (and other physicians just finishing their residency), this may be your first employment agreement and you likely haven’t had much guidance on what should (or shouldn’t) be in the agreement. Given the intelligence and level of education necessary to get to the point of a post-residency employment agreement, it is likely that you will be able to grasp the meaning of the provisions in the agreement and even catch some unfavorable terms. It is less likely, however, that you will be able to identify beneficial terms that are missing from the employment agreement or understand how specific provisions are commonly negotiated. An attorney can help make sure you don’t miss any opportunities. Q: Are there certain provisions that I should focus on when I review my first employment agreement? A: Although it is important to carefully read the entire employment agreement, there are certain provisions that require special attention. Two such provisions are the “term” and “early termination” provisions. The “term” provision should clearly identify the date on which you start your employment and the date on which your employment terminates. It should also clarify whether the agreement simply expires at the end of the initial term or whether it automatically renews for additional terms. The “early termination” provision is equally as important. This provision may contain “for cause” or “no cause” language (or both). “For cause” termination will be found in any well-written employment agreement and allows a party to terminate the employment agreement if the other party materially breaches its terms. A “no cause” termination provision allows a party to terminate the agreement at any time (and for any reason) by providing notice to the other party. The following example illustrates the importance of the term and early termination provisions in an employment contract. We recently advised a client who accepted an employment offer only to receive a more attractive offer shortly after she signed the first offer. The employment contract for the first offer was a well-written agreement which was negotiated by both parties and had clear term and no-cause early termination provisions. Based on the clear and unambiguous contract terms, our client was able to provide a notice of termination to the first employer, which took effect prior to the commencement of the term of the contract. Because the termination occurred prior to the start date, our client was free to accept the second job. The early termination provision, however, is not always favorable to the physician. When a physician insists on having an early termination provision, we often see the employer insist that the provision be mutual. In other words, when you want the right to be able to terminate the agreement upon notice to your employer, your employer will typically insist that it has the right to terminate you upon the same notice. The result is reduced job security despite having a written employment agreement. Another legal issue we have recently seen surface because of an early termination provision is patient abandonment. Patient abandonment is a type of medical negligence that occurs when a physician improperly terminates the doctor/patient relationship, which results in harm to the patient. This issue is more of a concern in rural health care systems than in larger health care systems since there are less colleagues available to cover patients when a physician terminates his or her employment. That said, this doesn’t preclude you from including a termination provision in your employment agreement, but a longer notice period (e.g., 180 days instead of 30 days) may be more appropriate. In addition to the term and early termination provisions, it is important to ensure that all the details you have discussed with your prospective employer have made their way into your employment agreement. Some key provisions to look for include: job expectations (e.g., necessary credentials and licenses, scheduling, team meetings, on-call coverage, etc.); compensation (e.g., base salary, pay frequency, bonus structure); benefits[1]; malpractice insurance coverage (be sure to understand whether the employer offers tail coverage which provides coverage after the policy expires or is cancelled); office location and equipment; and number of support staff. Though this list is not intended to be exhaustive, it will provide you with a good start on items to look for in your first employment agreement. Q: I noticed that my employment contract has a “non-compete provision” – is this common and does it prevent me from taking a new job after my contract is up? A: Non-compete provisions are standard in physician employment agreements. A non-compete provision is a clause in the agreement the prevents an employee from working for a competitor after the termination of the employment agreement. At first blush, most physicians (and non-physicians alike) disfavor non-compete provisions. In fact, we have even seen physicians walk away from employment opportunities because the employer refused to remove the non-compete provision from the employment agreement. What many people don’t understand about non-compete provisions, however, is that they must be reasonable in order to be enforceable. For example, a provision that prohibits you from practicing any type of medicine whatsoever following the termination of your employment will likely be unenforceable. A non-compete provision must be tailored to protect the employer’s interest and cannot be unduly burdensome on you. It must also be reasonable in terms of both its time period and geographic scope. While it is unlikely that your employer will agree to completely remove the non-compete provision from the employment agreement, you may be able to negotiate a narrower scope. This may include limiting the geographic area, shortening the time frame, or even limiting the scope of the provision to cover only specific specialties or specific health care systems. This is yet another reason to enlist an experienced health care attorney to help you. Reprinted with permission from the May/June 2023 issue of The Bulletin from the Monroe County Medical Society and available as a PDF file here. Brandon M. Ball is an associate attorney in Underberg & Kessler LLP’s Corporate & Business, Creditors' Rights, Health Care, and Municipal Law Practice Groups. He can be reached at bball@underbergkessler.com or 585.258.2858. [1] Note that, since benefits often change and are generally the same for all similarly situated employees, these may or may not be included in the employment agreement. If they are not included, you should be sure to ask for and review any documentation that describes your benefits.

We had a great time helping Heritage Christian Services last week for the United Way’s Day of Caring. Our Diversity, Equity, Inclusion & Belonging Committee (DEIB) Committee coordinated the raking, mulching, weeding, planting, and cleaning efforts of U&K colleagues to spruce up the organization’s Baird Road location. Our team had lots of fun and worked hard to help a wonderful organization. Thanks to U&K's Leah Cintineo, Debbie Christiano, David Craig, Kate Karl, Paul Keneally, Robert LaPlaca, Kaitlyn Pierce, Tyler Stark and Alex Wezelis for volunteering.

If you like your gas-powered car or truck, you cannot keep it according to the Biden Administration’s proposed Clean Air Act vehicle emission rules. On April 12, 2023, the Environmental Protection Agency (“EPA”) issued a proposed rule for carbon dioxide emissions that limits the amount generated by cars and trucks from 2027 through 2032. In order to meet the standards, electric vehicles (“EV”) will need to account for two-thirds of car and light truck sales by 2032. Strikingly, this mandate is even more aggressive than President Biden’s August 2021 Executive Order that set the lofty goal of having 50% EV sales by 2030. Based on the 2021 EPA standards, EPA’s emission standard was a grams/mile of CO2 equivalent of a fleet average of 161 g/m for the 2026 model year. By comparison, EPA’s new proposed vehicle standard sets an emission limit of 152 g/m for 2027 cars and trucks. The standard escalates each year until the 2032 period when the limit is 82 g/m. To meet the 2032 standard vehicles would be required to meet a fuel economy standard of around 100 miles per gallon. Although EPA is ostensibly attempting to use the Clean Air Act emission limits to regulate emissions, this rule is intended to force US automakers to phase out gas-powered vehicles and produce EVs. EVs only account for around 6% of vehicle sales currently, so it is hard to conceive of how automakers or the country will be able to transition to meet EPA’s mandates in the next decade. As we have reported in prior articles, there are also a myriad of issues in transitioning to large scale EV use by US consumers and businesses. While the issues seem fundamental, they are apparently not worthy of consideration by the Biden Administration and EPA in setting car and truck emission standards that will be incredibly expensive and disruptive for citizens. First, EVs are substantially more expensive than gas-powered vehicles ranging from 10% to 40% more. In an attempt to offset expense concerns, EPA has suggested that the rules are feasible due to subsidies and tax credits under the Inflation Reduction Act. Even accounting for the subsidies, the Energy Information Administration recently forecast that EVs will only make up 15% of sales in 2030 and 19% in 2050. The report also noted that although EVs are popular among luxury cars, they “remain less competitive against conventional gasoline-powered cars and light trucks serving the mass market.” The practicality of EVs is also limited. EVs are presently appealing to citizens in urban areas that do not drive long distances. This is not surprising given the average range of an EV is 250 miles. In addition, charging times can be significant. Household charging can take up to 50 hours. Even using a 240 outlet to charge an EV can take up to 10 hours. The US electrical grid currently does not have sufficient capacity to charge an EV car and truck fleet if consumers transition to the level of EV use mandated under EPA’s new rules. As addressed previously in this column, residential neighborhoods do not have sufficient capacity to sustain large-scale EV charging during peak night-time hours. Without massive changes to the electrical grid, the country could be subject to significant blackouts like California and Texas recently experienced. An additional consideration in northern climates is that EVs are less efficient and safe in snow and extreme conditions. After sustaining multiple winter storms in Western New York and the Buffalo area during the winter of 2022-2023, in which numerous lives were lost when drivers were stranded, vehicle safety and security seem critical to New York residents. Assessments have indicated that EVs are 25% less efficient in freezing weather and up to 40% less efficient when drivers are using heat in vehicles. Finally, the Biden Administration mandate is completely divorced from any analysis of international security and energy independence to protect the interest of US citizens and businesses. As we have reported in this column previously, EVs require lithium, copper, and cobalt for battery manufacturing. The vast majority of these minerals are mined in areas of the world that are not friendly to US interests. Significantly, China and Chinese-owned state industries have taken steps to acquire control of mining and processing companies that control the precious metals necessary for EV battery production. At a time of heightened tensions with China, it makes very little sense to mandate US companies and consumers become further dependent on Chinese-controlled materials to meet an emission standard that can only be attained through transformation to EV use. As we have seen with petroleum supplies and costs from the Middle East, ceding US energy independence has only hurt US consumers and heightened inflation. Compelled transformation to EVs by 2032 is likely to do the same on a massive scale. Reactions to the proposed rule have been quite stark. Among other comments, Senator Joe Manchin (D-W.Va.) said that EPA is “lying to Americans” with “false claims about how their manipulation of the market to boost EVs will help American energy security.” Further, Senator Manchin noted that “[i]n reality, this is a Trojan horse.” Manchin expressed concern that “[t]o meet these timelines will mean strengthening our reliance on minerals and technologies controlled by the Chinese.” As a result, Senator Manchin indicated that he would support other Senators’ growing calls to take legislative action to overturn the proposed EPA rules. The proposed EPA rule is also likely to be challenged in the courts on various grounds. A recent decision by the United States Supreme Court in West Virginia v. EPA dealing with Clean Air Act and the Clean Power Plan established that EPA does not have unlimited authority to impose regulatory schemes that set major policy for the entire country. The decision addressed the major questions doctrine and found that “it is not plausible that Congress gave EPA the authority to adopt its own such a regulatory scheme…A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to clear delegation from that representative body.” In recent weeks, we have seen state and national reporting on efforts by New York State and the federal government to ban natural gas stoves and furnaces. On some level, those stories are amazing and fundamentally detrimental to personal choice and freedom. The Biden Administration’s self-pronounced war on fossil fuel has now taken a huge leap with the EPA’s proposed vehicle emission rules that will require two-thirds of all vehicles to be EVs by 2032. However, one feels about environmental protection and climate matters, Americans would be well served to vote like their freedom, safety, and lifestyle depend on election outcomes as this is further proof that elections matter. George S. Van Nest is a Partner in Underberg & Kessler LLP’s Litigation and Municipal Practice Groups and Chair of the Firm’s Environmental Practice Group. He focuses his practice in the areas of environmental law, development, construction, and commercial litigation. George can be reached at gvannest@underbergkessler.com. Reprinted with permission from The Daily Record and available as a PDF file here.

Congratulations to Paul F. Keneally for being selected to The Daily Record's 2023 Power 20 Labor & Employment Law list for the second year in a row. The Power 20 list showcases power players in the Western New York legal community who are recognized as leaders in their area of practice. “The people on this list help both companies and employees navigate the ever-changing laws and regulations that govern employment. In recent years, that has included everything from minor issues to major concerns such as remote working policies, pay transparency, non-compete agreements, and more. These attorneys help their clients stay informed and protected and represent their clients’ interests when necessary," stated Ben Jacobs, Associate Publisher and Editor of The Daily Record. Keneally serves as Chair of the Firm's Labor & Employment Practice Group and is a Partner in our Litigation and Municipal Law Practice Groups. He focuses his practice on providing advice to clients on a wide range of day-to-day labor and employment matters, resolving complex litigation, labor and employment disputes, and more. Keneally serves on the Board of Directors of the Society of Human Resource Management as its Legislative Representative and as Counsel to the Board of Directors and Management of The Tennis Club of Rochester. He is a past member of the Board of Directors of Literacy Volunteers of Rochester, Career Development Services, and the Young Audiences of Rochester.

On April 11, 2023, the New York State Department of Labor (“NYSDOL”) released the State’s updated model Sexual Harassment Prevention Policy (a copy of the model policy, which employers can adopt, is available here). The NYSDOL also released an updated training video (available here) and new training presentation slides (available here) that incorporate the additions to the new policy. The NYSDOL’s major revisions to the model policy include: Memorializing the 2018 amendments to the New York Labor Law that reduced the measure of unlawful conduct from a “severe or pervasive” standard to lower conduct that is “less well” based on a legally protected characteristic and above a “petty slight or trivial inconvenience;” Defining sexual harassment as a form of “gender-based” discrimination inclusive of gender, sexual orientation, gender identification and expression, and being transgender; Explicitly stating that harassing conduct can occur in remote workplace settings; Explicitly stating that intent is not a defense under the law. Rather, it is the impact on the victim and perspective of “reasonable victim of discrimination with the same protected characteristics” that will be relevant in assessing whether the law has been violated; Explicitly stating that management must “accommodate the needs of individuals who have experienced harassment to ensure the workplace is safe, supportive and free from retaliation for them during and after any investigation;” Adding a new section encouraging bystander intervention, including five (5) methods that can be used if an employee witnesses harassment or discrimination; and Referencing New York State’s confidential hotline for complaints of workplace sexual harassment, which was introduced in July 2022. To be clear, although the new model policy is focused on gender-based discrimination and is entitled “Sexual Harassment Policy for All Employers in New York State,” the New York State Human Rights Law protects against discrimination in other protected characteristics and the policy “should be considered applicable to all protected classes.” It is therefore important for employers to review and update their policies and training materials as soon as possible to ensure compliance. If you have any questions regarding this article, or how to determine if your employment policies are legally compliant, please contact the Underberg & Kessler attorney who regularly handles your legal matters, or Ryan T. Biesenbach at (585) 258-2865 or rbiesenbach@underbergkessler.com To have these legal alerts sent straight to your email, click here to join our email list.

Underberg & Kessler LLP and Genesee Regional Bank are pleased to present a complimentary seminar for realtors to learn timely and critical information to help them stay current in the ever-changing residential real estate market. The "Stay Current in Today's Residential Real Estate Market" seminar will feature presenters from GRB and U&K covering important topics such as: Strategies for navigating the spring-summer market from a lender's perspective New mortgage loan products to help you succeed What are Good Cause Evictions and why are they so controversial? How to avoid the “terrible, horrible, no good, very bad” closing The latest on New York State's gas appliance ban Housing industry shortages and potential solutions on the horizon The event will be held on May 4th, 2023, from 8:00 am - 11: 00 am at Monroe Golf Club. There is no charge to attend this presentation but seating is limited - so register soon! Registration is required to attend. Click here to register.

In its recent decision in Helix Energy Solutions Group, Inc. v. Hewitt, the United States Supreme Court ruled that high compensation alone does not ensure exemption from the right to overtime under the Fair Labor Standards Act (“FLSA”). Employees are frequently referred to as “hourly” and entitled to overtime under the FLSA, or “salaried” and not entitled to overtime under the FLSA. It should be well known by now that being “salaried” is not enough for an FLSA exemption, as the salary must be above the relevant minimum amount and one of the exemption “duties” tests must be met. In this case, the U.S. Supreme Court dealt with a situation where the employee claiming overtime made over $200,000.00 a year but was paid on a daily basis, not a salaried one. The Court responded by holding that the payment on a salaried basis remains a requirement to be exempt regardless of the amount of compensation received on another basis (in this case by day-rate). Salaried is defined as where the employee receives a “predetermined amount constituting all or part of the employee’s compensation which amount is not subject to reductions because of variations in the quality or quantity of the work performed.” The “highly compensated” exemption to the FLSA overtime rule remains for those making at least $107,000.00 a year, but only where at least the minimum amount of that compensation ($684 per week) is paid on a salary basis. Also, the employee’s primary duty must include performing office or nonmanual work and the employee must customarily and regularly perform at least one of the exempt duties or responsibilities of an exempt executive, administrative, or professional employee. It is usually not difficult to find one of those exempt duties being performed by a typical office employee. Employers grappling with any of the subtle FLSA overtime exemptions should consult with their employment attorney or contact Paul F. Keneally at (585) 258-2882 or pkeneally@underbergkessler.com. To have these legal alerts sent straight to your email, click here to join our email list.

The environment for long-term care for the elderly, and particularly skilled nursing care, is complex, often emotionally charged, and marked by financial burdens on all sides. Skilled nursing care is costly to provide and thus expensive, and nursing homes and their residents are facing unprecedented staffing shortages, economic pressures, and a complicated network of statutes and regulations (including the Medicare and Medicaid laws). My family’s recent interaction with that environment helps illustrate the interplay between a nursing home’s need to receive payment for the services it provides to remain viable and continue to serve the community and the obligation of residents to pay their lawful share for those services. One year ago, my elderly mother had what the doctors described as a “mini-stroke.” Already suffering from dementia, she spent a month in rehab and then came home to continue living with my father. We hired aides to help them out and keep my mother from falling; my siblings and I took turns coming over in the evening to bring our parents dinner and make sure that my mother took her medications. Just after Thanksgiving, my mother fell and broke her hip. After surgery, she again went to rehab, but was in appreciably worse shape than she had been before. The plan was to have aides in the house 24 hours a day to help both of our parents (which was very costly and not covered by Medicare or Medicaid). Then, when my mother was scheduled to come home, we learned that my father was dying. We brought my mother home with aides on duty 24/7, but my father quickly deteriorated and died about a month ago. Our thoughts turned to placing our mother in a skilled nursing facility (a nursing home) so that she could live in a safe environment and eliminate the high cost of in-home aides. From our discussions with various facilities, we understood that we would have to use my mother’s assets and income (to the extent they were not exempt for Medicaid purposes) to pay the monthly charges for her care at the “private pay” rate, and that once those assets were spent, she would become eligible for Medicaid. Most nursing homes accept Medicaid. However, a resident must meet the financial eligibility requirements to receive Medicaid for skilled nursing services. In other words, because Medicaid is intended for low-income persons only, a resident with non-exempt assets and income must first use those assets and that income to pay for their care until they meet the financial threshold for eligibility for Medicaid benefits. When someone applies for admission to a nursing home, they must disclose the assets and income available to pay for their care (until such time they become eligible for Medicaid), and they must agree to use those assets and income for that purpose. If, as in my family’s situation, the resident lacks capacity to contract, a responsible party, who is often the resident’s attorney-in-fact under the resident’s power of attorney, is asked to sign the admission agreement. In most admission agreements, the responsible party agrees that they have access to and control over the resident’s disclosed financial resources, and that they will use those financial resources to pay the nursing home for the care provided to the resident. Although no facility may require a responsible party to guarantee payment for the resident’s care out of the responsible party’s assets, both federal and New York State law expressly authorize agreements that bind a responsible party who agrees to use the resident’s disclosed financial resources to pay for the resident’s care. In most circumstances, the responsible party abides by their agreement to use the resident’s financial resources to pay for the resident’s care. However, there are occasions in which the responsible party transfers some or all of the resident’s assets to themselves or diverts the resident’s financial resources to some other purpose rather than using those resources to pay for the resident’s care, or refuses to use the resident’s income (such as Social Security benefits) to cover part of the cost of that care. If a responsible party engages in such conduct, they are, at minimum, in technical breach of the admission agreement. When that happens, the nursing home is put in a situation where it is providing the resident with the agreed care without any compensation and must try to convince the responsible party to honor the promise to use the resident’s financial resources to pay for that care. When such efforts are unsuccessful, the nursing home may commence a lawsuit against the responsible party to recover the agreed charges. The complaint in such an action may assert, among other claims, causes of action for breach of contract and under the New York Debtor and Creditor Law (“NYDCL”). In these circumstances, a breach of contract claim is fairly straightforward: the responsible party breached their agreement to use the resident’s financial resources to pay for the resident’s care, and the nursing home incurred damages as a result. Generally speaking, claims under the NYDCL may include claims based on statutory language that defines a conveyance of assets with the actual intent to defraud a creditor as fraudulent, and/or claims based on statutory language that defines a conveyance that does or will render a person insolvent as fraudulent as to creditors, without regard to actual intent, if the conveyance is made without a fair consideration. The New York Appellate Courts, including the Fourth Department, that have addressed the enforceability of admission agreements against responsible parties have held that a party responsible for the assets of a nursing home resident may be held personally liable for the cost of the resident’s care if it is shown that they breached the terms of an agreement with a nursing home by impeding the nursing home from collecting its fees from the resident’s funds or resources over which they exercised control. Moreover, the Fourth Department has held that claims under the NYDCL may be stated against an attorney-in-fact who has rendered a nursing home resident insolvent through uncompensated transfers. Thomas F. Knab is Managing Partner and Chair of the Firm’s Litigation Practice Group. He focuses his practice on commercial litigation, business and corporate disputes, and construction and real estate litigation. Tom can be reached here or call 716.847.9104. Reprinted with permission from The Daily Record and available as a PDF file here.

Congratulations to Patrick L. Cusato for being selected to The Daily Record's 2023 Power 20 Real Estate Law list for the second year in a row. The Power 20 list showcases power players in the Western New York legal community who are recognized as leaders in their area of practice. “The people on this list help clients navigate complex transaction processes to help fulfill their personal dreams or organizational goals. Their job has been made even more difficult over the past two years. At the same time as the COVID-19 pandemic was changing the way the entire real estate transaction process worked, the real estate market was getting turned on its head. These attorneys continued to serve their clients admirably while navigating new ways of doing business thanks to restrictions that limited or halted face-to-face meetings," stated Ben Jacobs, Associate Publisher and Editor of The Daily Record. Cusato, Partner, and Chair of the Real Estate & Finance practice group and a member of the Firm’s Executive Committee, focuses his practice on commercial and residential real estate, mortgage banking, and tax credit finance law. Pat is past President and an Executive Board member of the Mortgage Bankers Association of the Genesee Region, an Executive Board member of Bishop Sheen Ecumenical Housing Foundation, and past Chair of the Monroe County Bar Association Real Estate Section.

In January, Governor Kathy Hochul proposed the New York Housing Compact, which includes a series of proposals to address the purportedly low housing selection across New York. The New York Housing Compact aims to complement the Governor’s Housing Plan announced last year to create or preserve 100,000 affordable homes throughout New York. Additionally, several bills sit in the New York State Senate to address housing shortages across the State. The New York Housing Compact proposals are broad and include subsidies for localities to fund infrastructure, mandate minimum housing growth targets for municipalities, rezoning areas near train stations, facilitating housing approval at the State level when localities are unable to meet targets, removing obstacles to housing approvals, and expanding tax incentives and assistance to renters. Subsidies to Fund Infrastructure The New York Housing Compact will create an Infrastructure Fund of $250 million and a Planning Fund of $20 million to encourage new housing throughout the State. Localities may submit requests for subsidies to further Transit-Oriented Development or Preferred Actions, or good-faith measures to increase housing availability. Housing Growth Targets The New York Housing Compact will also require all cities, towns, and villages to create new homes on a three-year basis. New York City is required to meet a 3% growth rate over three years, while upstate municipalities must achieve 1% growth in new homes every three years. The creation of new housing counts toward the target, with extra weight assigned to the creation of affordable units. Municipalities are vested with the power to decide how to meet the targets, but those that do not meet targets may still achieve a Safe Harbor status for one three-year cycle by employing good-faith Preferred Actions, which create capacity to achieve the housing growth targets. Preferred actions may include new housing, particularly below-market rate, income-restricted affordable housing. Transit-Oriented Development and Rezoning Near Train Stations According to the fact sheet from the Governor’s office, the New York Housing Compact will also require localities that have rail stations operated by the MTA “to undertake a local rezoning or higher density multifamily development within half a mile of the station unless they already meet the density level.” The aim is to improve access to jobs through transit. State Override of Local Zoning Laws Governor Hochul derided local governments for their zoning restrictions at her State of the State address in January. To combat this, the New York Housing Compact provides that if a municipality does not remove zoning restrictions which impede new development, and the locality fails to meet its growth target or does not implement Preferred Actions, developers may circumvent the municipality and seek approval via the courts or the newly conceived State Housing Approval Board. Based on the press release from the Governor’s office, projects will be approved by the Board “unless a locality can demonstrate a valid health or safety reason for denying the application.” Many municipalities have interpreted this to mean that developments will be permitted absent any exigent circumstances. Practically speaking, localities will be forced to allow developments that do not conform with current local zoning laws, which could create developments that do not match with the character of existing neighborhoods and may run contrary to a comprehensive plan, may pose issues for code enforcement, and could set precedent the locality sought to avoid. Relief from Environmental Review Relief from environmental review is included in the housing growth and transit-oriented development proposals in the New York Housing Compact, although the State has indicated that it remains committed to exercising safeguards to prevent harm to the environment and public health. Tax Incentives for Developers The Governor intends to allocate $5 million in State Low Income Housing Tax credits to foster development of affordable housing. The New York Housing Compact includes several tax incentives to encourage housing development throughout the State, such as new property tax exemptions for mixed income housing development near train stations and affordable housing in commercial buildings that are converted to residential use in New York City. Further, the Governor plans to unveil a new 421-a property tax exemption program that would provide an exemption to real-estate developers for building new multifamily residential housing buildings in New York City. Support for Homeowners The New York Housing Compact includes plans to update property tax exemptions for homeowners that build accessory dwelling units and includes proposed changes to prevent penalizing municipalities who use Payment-in-Lieu-of-Taxes (PILOT) agreements with tax cap calculation. Governor Hochul has also disclosed two new proposals to assist renters and homeowners. The first is a fund modeled after the Buffalo East Homeownership Assistance Program to aid homeowners with repairs in targeted areas that have been identified as having high levels of homeowner distress or low-income homeowners of color. Next, the Governor has proposed increasing funding and presence for the State’s Tenant Protection Unit (TPU). The TPU acts as a proactive law enforcement office within New York State Homes and Community Renewal. Its purpose is twofold: preserving affordable housing by discouraging patterns and practices of landlord fraud and harassment; and encouraging compliance by keeping tenants informed of their rights and responsibilities under the rent regulation laws. The expansion of the TPU is aimed to benefit mobile home residents, as well as those living in farmworker housing. Additional Housing and Zoning Proposals Before the Legislature Three bills currently sit before committee in the New York State Senate. Senate Bill S7574, would amend General City and Village Laws by preventing cities from establishing various zoning requirements, including a minimum lot size of more than 1,200 square feet, requiring off-street parking as a condition for construction of a building (except for the loading of deliveries), and prohibiting construction and occupation of a building for four or fewer families in a single lot, imposing height or setback restrictions, or prohibiting the construction and occupation of a dwelling for six or fewer families on a single lot for those dwelling near a rail or subway station operated by the MTA. Bill S7574 would also amend Town Law to prevent towns from establishing a minimum lot size of more than 5,000 square feet if a lot has access to sewer and water or a minimum lot size of more than 20,000 square feet in any area. Senate Bill S4547A, amends the Real Property Law to legalize accessory dwelling units (ADUs) throughout the State, including existing basement apartments, in-law suites, and backyard cottages. The bill also includes a mechanism for a party who has been denied a permit for an ADU to appeal the denial in a court of competent jurisdiction. Senate Bill S7635A amends the Public Housing Law by streamlining the permit application process for low- or moderate-income housing developments. It also requires municipal Zoning Boards of Appeals to approve applications for low- or moderate-income housing unless written findings show that the proposed development would have a specific, adverse impact on public health or safety, and there is no feasible manner to mitigate or avoid such adverse impact. If applications are still denied or are granted with conditions by a local Zoning Board of Appeals, applicants may appeal to the State Board. Change is certainly afoot throughout the State to address housing shortages. However, what remains to be seen is the long-term effect it will have on municipalities and their communities at large. Ericka B. Elliott, an Associate in our Litigation and Municipal Law Practice Groups, focuses her practice on commercial litigation, land-use, and municipal law matters. If you have any questions regarding this article, please contact Ericka here or call 585.258.2800. Reprinted with permission from The Daily Record and available as a PDF file here.

Effective February 9, 2023, upon execution by Governor Hochul, the New York State Warehouse Worker Protection Act requires New York employers who have at least 100 employees in a single warehouse, or 500 employees statewide, to provide written notice to their employees of any production quotas. Employers subject to the new law also must be sure the quotas reflect employees taking reasonable rest periods and bathroom breaks and must comply with all other local, state, and federal health and safety laws. Employers subject to the new law would be wise to have all the relevant quota and safety information (including any possible discipline/coaching related to missing quotas) in the job description signed by the employee, in addition to on a separate notice posted where all the other labor and employment law notices are on display. Employers also must notify their employees in writing how the quotas were developed (e.g., long experience, that they are reasonable, industry benchmarking, etc.). While this law was purportedly aimed at Amazon and similar entities, it applies to any company with the requisite number of employees and given that it was premised on data showing increased injuries in workplaces with quotas, Department of Labor enforcement is likely. If you have any questions regarding this new law, or any other labor or employment law topic, please call Paul F. Keneally at (585) 258-2882 or email Paul here. To have these legal alerts sent straight to your email, click here to subscribe.

On February 21, 2023, the National Labor Relations Board (“NLRB”) issued a decision that may significantly alter the use of confidentiality and non-disparagement provisions in severance agreements. The decision – McLaren Macomb, 372 NLRB No. 58 (2023) – reverses the standing precedent surrounding severance agreements and calls into question some well-worn clauses favored by employers that enter into such agreements with exiting employees. In McLaren, the NLRB examined whether an employer’s offering of severance agreements to several of its employees who had been permanently furloughed as a result of the COVID-19 pandemic infringed upon those employees’ rights under Section 7 of the National Labor Relations Act (“NLRA”), itself a violation of Section 8(a)(1) of the same. Section 7 of the NLRA guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right “to refrain from any or all such activities.” Section 8(a)(1) makes it an unfair labor practice for an employer “to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7” of the NLRA. Generally, confidentiality and non-disparagement provisions prohibit employees from disclosing the terms of their severance agreements to third parties and from making statements that could disparage or harm the image of the employer. The severance agreements in McLaren contained terms familiar to many employers and specifically provided: Confidentiality Agreement. The Employee acknowledges that the terms of this Agreement are confidential and agrees not to disclose them to any third person, other than spouse, or as necessary to professional advisors for the purposes of obtaining legal counsel or tax advice, or unless legally compelled to do so by a court or administrative agency of competent jurisdiction. Non-Disclosure. At all times hereafter, the Employee promises and agrees not to disclose information, knowledge or materials of a confidential, privileged, or proprietary nature of which the Employee has or had knowledge of, or involvement with, by reason of the Employee’s employment. At all times hereafter, the Employee agrees not to make statements to Employer’s employees or to the general public which could disparage or harm the image of Employer, its parent and affiliated entities and their officers, directors, employees, agents and representatives. In analyzing the language of these provisions under the NLRA, and relying on certain prior precedent, the NLRB held that “a severance agreement is unlawful if its terms have a reasonable tendency to interfere with, restrain, or coerce employees in the exercise of their Section 7 rights, and that employers’ proffer of such agreements to employees is unlawful.” While the NLRB’s ruling this week could be appealed, the ruling is effective immediately. Employers should consider the McLaren decision when drafting and negotiating severance and other employment agreements. If you have any questions regarding this article, or how to determine if your severance agreement is legally compliant, please contact the Underberg & Kessler attorney who regularly handles your legal matters or Ryan T. Biesenbach, the author of this article, here, or at (585) 258-2865. To have these legal alerts sent straight to your email, click here to subscribe to our newsletter.