New York state and federal courts have long disagreed over the application of the New York State and New York City anti-discrimination laws to out of state employees, who claimed employment discrimination by New York based employers. In an attempt to set limits on the geographic scope of the New York State Human Rights Law and New York City Human Rights Law, courts seemed to embrace the concept that the location of where the discriminatory decision was made was not relevant, but rather where the impact of the discriminatory decision was felt.
This so-called “impact” rule prevented many out of state employees from suing their New York employers under New York law, because the impact of any discrimination was determined to be felt by the out of state employees in their own home states, and not New York. Recently, however, the Appellate Division, First Department, rejected the impact rule to the extent that a plaintiff, outside of New York, could allege and ultimately prove that the discriminatory decision affecting him or her, be it a termination, demotion, or other adverse employment action, occurred within New York.
In Hoffman v. Parade Publications, 115851/08 , the Appellate Division, First Department expressly held that “[t]he so-called ‘impact’ rule . . .should not be applied so broadly to preclude a discrimination action where the allegations support the assertion that the act of discrimination, the discriminatory decision, was made in [New York].”
In Hoffman, the salesman, Howard Hoffman, was based in Parades’ Atlanta, Georgia office for most of his tenure with the company. While on a plane in Atlanta, Hoffman received a call from Parade’s president, informing him that that the Atlanta office would be closed due to economic reasons, and that Hoffman would be out of work. Over a week later, Hoffman met with the president in New York in an attempt to convince him to save his job and permit him to work from home, which would result in economic savings to Parade. Nevertheless, several days later, Parade’s president called Hoffman, while he was in West Virginia to tell him that he would still be losing his job. In fact, Hoffman, who was the oldest employee in the company and the only one terminated, sued Parade alleging violations of the New York State Human Rights Law and New York City Human Rights Law.
Although the trial court rejected Hoffman’s New York claims on the grounds that the impact of the discriminatory decision was not felt in New York, the Appellate Division First Department reversed, holding that Hoffman could sue under New York state and city law based upon the allegation that the discriminatory decision was made in New York. In allowing Hoffman to proceed with his claim, the Appellate Division expressed an “important distinction between a mere decision to terminate an employee and a discriminatory decision to terminate an employee.”
The Appellate Division First Department’s decision is a boon to out of state/city employees. The New York City Human Rights Law is one of the most progressive anti-discrimination statutes in the country, and in many significant respects is much broader and more favorable to employees than federal law. The Hoffman decision is one of recent decisions issued by appellate courts in New York, recognizing a more expansive view of New York City law.