Update: On March 20, 2020, Governor Cuomo announced that he will issue a new order requiring employees of all non-essential New York businesses to work from home. We are monitoring these developments and will update this client alert as soon as the governor’s executive order and any accompanying guidance are available.
New York State has become the epicenter of the nation’s COVID-19 pandemic, and the state’s 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 any 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.” There are few substantive limitations on this gubernatorial authority, as such directive must merely “be necessary to cope with the disaster,” and indeed the governor is given the additional power to “provide for procedures reasonably necessary to enforce such directive.” The state’s Executive Law does include a few procedural limits and requirements, including establishing that all suspensions must be limited to 30 days—though the governor can extend that for additional 30-day periods indefinitely—and requiring the governor “specify the statute, local law, ordinance, order, rule or regulation or part thereof to be suspended.” By its terms, the law only permits the governor to “suspend” only a state or local law, or part thereof; it does not give the governor the authority to modify or amend such laws.
Armed with this broad authority, and willing to deploy it aggressively, Governor Cuomo has issued eight executive orders (EOs) in 14 days suspending dozens of state and local laws in order to aid the state’s response. Most recently, 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 governor’s executive order did not specify which state or local laws he was suspending or, as a practical matter, modifying in service of this emergency mandate—presumably local building, health and fire codes concerning workplace density—but it did include a series of exemptions from these requirements, including healthcare facilities, grocery stores, and “banks and related financial institutions.” EO 202.6 further stated that the Economic State Development Corporation (ESDC), the state’s job creation arm, which does not ordinarily have regulatory authority concerning workspace density, would publish guidance further explaining the work-from-home mandate, which was to take effect on March 20 at 8 p.m. ESDC was also directed to create a process for impacted entities to appeal and be deemed “essential,” thus not subject to the EO.
The very next day, March 19, the governor announced that the 50% requirement—which had yet to take effect—would increase to 75%, meaning only one-quarter of the workforce of a non-essential entity could report to their place of work. The governor then issued Executive Order 202.7, which codified this requirement and set an effective date of March 21 at 8 p.m.
ESDC also issued the guidance mandated by EO 202.6, which in some cases includes more specificity than the executive orders themselves regarding the categories of “essential businesses or services.” In particular, the type of financial institutions considered essential is further yet broadly defined to include, but not be limited to, “banks,” “insurance” and “accounting,” with no limitations concerning types of personnel permitted to be physically present at such institutions. “Telecommunications,” “pharmaceuticals” and “pharmacies,” and numerous other sectors are also excluded. The ESDC guidance also includes a link to a straightforward form an entity not already considered “essential” must fill out and submit in order to be considered for an exception and such a designation. Essential businesses must nevertheless comply with New York State Department of Health rules and recent guidance regarding keeping a clean and safe working environment.
The governor’s Executive Order 202.7 work-from-home requirement takes effect on March 21 and expires on April 18. 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.