Effective as of October 5, 2021, Int. 2397-2021 requires operators of “transient hotels” (as defined by Section 12-10 of the New York City zoning resolutions) to pay their employees severance pay if: (1) the hotel closed to the public and has not, by October 11, 2021, recalled at least 25% of the number of employees it employed as of March 1, 2020 and has not reopened to the public by November 1, 2021; or (2) the hotel underwent a mass layoff after March 1, 2020 that resulted in the loss of work by at least 75% of employees during any 30-day period. There is an exception for hotels that have closed permanently and are in the process of converting to an alternative use, provided that: (1) the hotel employees were offered severance of at least 20 days’ pay per year of service; and (2) the severance was specifically tied to the conversion.

To be eligible for severance payment, an employee working at a covered transient hotel must have: (a) been employed by the hotel on March 1, 2020 for at least one year; (b) been employed to perform “hotel service” (defined broadly to include any work performed in connection with the operation of a hotel); (c) not been a managerial, supervisory or confidential employee who had the power to exercise control over the management of the hotel; and (d) been laid off after March 1, 2020 due to a closure or mass layoff. Severance payments are owed to all such employees beginning on October 11, 2021, for up to 30 weeks in the amount of $500 per week, or up to a total of $15,000. The obligation to provide severance ends when an employee is recalled, or, for a closed hotel, when the hotel reopens to the public and recalls 25% of its employees. Notably, any severance pay provided to a hotel employee prior to October 11, 2021 does not qualify as a set-off towards the obligations to pay severance to hotel employees after October 11, 2021; however, any severance payments made after October 11 will function as a set-off toward the severance pay obligations under this law. The law will expire and be deemed repealed on June 1, 2022.

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This law brings significant changes for NYC employers in the hotel industry. Employers are advised to review their current practices to ensure they are in compliance with these new requirements, and consult with their Proskauer attorneys regarding next steps.

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Photo of Michael Lebowich Michael Lebowich

Michael J. Lebowich is a partner in the Labor & Employment Law Department and co-head of the Labor-Management Relations Group. He represents and counsels employers on a wide range of labor and employment matters, with a particular interest in the field of traditional…

Michael J. Lebowich is a partner in the Labor & Employment Law Department and co-head of the Labor-Management Relations Group. He represents and counsels employers on a wide range of labor and employment matters, with a particular interest in the field of traditional labor law.

Michael acts as the primary spokesperson in collective bargaining negotiations, regularly handles grievance arbitrations, assists clients in the labor implications of corporate transactions, and counsels clients on union organizing issues, strike preparation and day-to-day contract administration issues. He also has significant experience in representation and unfair labor practice matters before the National Labor Relations Board.

His broad employment law experience includes handling of race, national origin, gender and other discrimination matters in state and federal court. A significant amount of his practice is devoted to counseling clients regarding the application and practical impact of the full range of employment laws that affect our clients, including all local, state and federal employment discrimination statutes, the Fair Labor Standards Act, the Family and Medical Leave Act, and state labor laws.

Michael has substantial experience in a wide variety of industries, including entertainment, broadcasting, newspaper publishing and delivery, utilities and lodging. He represents such clients as The New York Times, BuzzFeed, ABC, the New York City Ballet, PPL, Pacific Gas & Electric, Host Hotels and Resorts, and The Broadway League (and many of its theater owner and producing members).  Michael also has significant public sector experience representing, among others, the City of New York and the Metropolitan Transportation Authority.

Michael is a frequent guest lecturer at Columbia Business School, the Cornell School of Hotel Administration, the New York University Tisch School for Hospitality, Tourism and Sports Management, and is an advisory board member of the Cornell Institute for Hospitality Labor and Employment Relations.

Photo of Steven Porzio Steven Porzio

Steven J. Porzio is a partner in the Labor & Employment Law Department and a member of the Labor-Management Relations Group. Steve assists both unionized and union-free clients with a full range of labor and employee relations matters. He represents employers in contract…

Steven J. Porzio is a partner in the Labor & Employment Law Department and a member of the Labor-Management Relations Group. Steve assists both unionized and union-free clients with a full range of labor and employee relations matters. He represents employers in contract negotiations, arbitrations, and representation and unfair labor practice cases before the National Labor Relations Board.

Steve has experience conducting vulnerability assessments and providing management training in union and litigation avoidance, leave management, wage and hour, and hiring and firing practices. He provides strategic and legal advice in certification and decertification elections, union organizing drives, corporate campaigns, picketing and union contract campaigns. Steve has represented employers in a number of different industries, including higher education, health care, construction and manufacturing in successful efforts against unions in election and corporate campaigns.

In addition to his traditional labor law work, Steve assists companies with handbook and personnel policy drafting and review, daily management of employee disciplines and terminations, and general advice and counsel on compliance with federal and state employment laws.

Steve’s litigation experience includes work on matters before state and federal courts, the Equal Employment Opportunity Commission, the Connecticut Commission on Human Rights and Opportunities, the New York State Division of Human Rights and various other administrative agencies. He has litigated matters involving age, race, national origin, gender and disability discrimination, wage and hour, whistleblower and wrongful termination claims.

While attending the Syracuse University College of Law, Steve served as the editor-in-chief of the Syracuse Science and Technology Law Reporter. He also received the Robert F. Koretz scholarship, awarded in recognition of excellence in the study of labor law.

Photo of Arielle E. Kobetz Arielle E. Kobetz

Arielle E. Kobetz is an associate in the Labor & Employment Law Department and a member of the Employment Counseling & Training Group. Her practice focuses on providing clients with strategies and counseling related to a variety of workplace-related disputes, including employee terminations…

Arielle E. Kobetz is an associate in the Labor & Employment Law Department and a member of the Employment Counseling & Training Group. Her practice focuses on providing clients with strategies and counseling related to a variety of workplace-related disputes, including employee terminations and discipline, leave and accommodation requests, and general employee relations matters. She also counsels clients on developing, implementing and enforcing personnel policies and procedures and reviewing and revising employee handbooks under federal, state and local law.

Prior to joining Proskauer, Arielle served as a law clerk at the New York City Human Resources Administration, Employment Law Unit, where she worked on a variety of employment discrimination and internal employee disciplinary issues.

Photo of Rachel Kessler Rachel Kessler

Rachel Kessler is an associate in the Labor & Employment Department.  In leveraging her education background in industrial and labor relations, Rachel represents clients in a wide range of both employment and labor-management relations matters. Her recent work has involved the representation of…

Rachel Kessler is an associate in the Labor & Employment Department.  In leveraging her education background in industrial and labor relations, Rachel represents clients in a wide range of both employment and labor-management relations matters. Her recent work has involved the representation of clients in a diverse range of industries, including financial services, health services, performing arts, media, luxury retail and professional sports leagues.

As part of her employment practice, Rachel focuses on employment-related litigations in state and federal courts, before state and federal administrative agencies, and in arbitrations. Rachel regularly assists in defending employers from claims involving discrimination, retaliation, harassment, breach of contract, whistleblowing, wrongful termination and other employment-related torts.  Rachel also counsels on a variety of employment matters, including workplace investigations. In her labor-management relation practice, Rachel counsels and represented clients in NLRB proceedings.

Rachel also maintains a strong pro bono practice and has twice been awarded Proskauer’s Golden Gavel Award for excellence in pro bono work. She has represented incarcerated clients in parole proceedings and is an active member of the Firm’s Reproductive Rights Task Force.

Prior to joining Proskauer, Rachel interned with Judge Denis R. Hurley in the Eastern District of New York and worked for a semester as a legal intern at Legal Momentum, the nation’s first and oldest legal defense and education fund for women. During law school, Rachel was a notes editor of the International Law Journal and a member of the Gender Justice Clinic.