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Legal Update - July 2018 Newsletter

David Lloyd - Wednesday, July 11, 2018

Dear valued clients and supporters: This month's newsletter will focus on a series of new laws that are set to go into effect today (July 11, 2018) in New York state in response to the #MeToo movement.

As we previously covered in our prior newsletters, the New York State budget for 2019 included provisions aimed at curtailing sexual harassment in the workplace. Among them includes a law that goes into effect today which prohibits employers in New York state from including confidentiality provisions in settlement agreements for sexual harassment complaints, unless keeping the matter confidential is the complainant’s preference. The new law requires a consideration and revocation period, under which the complainant has 21 days to consider whether or not to accept the confidentiality language, and then has seven days to revoke his or her acceptance before the agreement becomes effective. If the complainant chooses to revoke his or her acceptance, the entire agreement is revoked. Employers are also advised that under the Tax Cuts and Jobs Act (signed into law on Dec. 22, 2017), a new Section 162(q) to the Internal Revenue Code was added, which prohibits employers from deducting costs related to sexual harassment settlements that are subject to nondisclosure agreements.

Effective today as well, New York State law now also prohibits mandatory arbitration clauses from applying to claims or allegations of sexual harassment. This prohibition is effective for contracts entered into on or after July 11, 2018.

Readers are encouraged to follow us on Twitter (@lloydpatelllp) and Facebook to receive updates on these and other issues throughout the month.


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