BILL NUMBER: S502
SPONSOR: PALUMBO
TITLE OF BILL:
An act to amend the labor law, in relation to the prohibition on retali-
atory action by employers against whistleblowers; and to amend chapter
522 of the laws of 2021 amending the labor law relating to retaliatory
actions by employers, in relation to the effectiveness of such
provisions
PURPOSE:
To prohibit retaliatory action against certain employees.
SUMMARY OF PROVISIONS:
Section 1. Subdivision 2 of section 740 of the labor law, as amended by
chapter 522 of the laws of 2021, is amended to read as follows:
(d) discloses, or threatens to disclose to a supervisor or to a public
body an action or activity that is a violation of, or an attempt to
circumvent, any of a company's internal controls implemented to prevent
fraud, or which the employee reasonably believes to be fraudulent.
Section 2. Section 3 of chapter 522 if the laws of 2021 amending the
labor law relating to retaliatory actions by employers, is amended to
read as follows: section of one of this act shall be deemed to have been
in full force and effect on and after January 1, 2018.
Section 3. Sets for the effective date.
JUSTIFICATION:
Corporate internal controls are critical, particularly those designed to
prevent fraud. Mosty recently, New York Community Bank and other New
York based financial institutions are at risk of failure and material
losses resulting from a lack of enforcement of internal controls. Whist-
leblowers who report violations of these internal controls (particularly
those designed to prevent fraud) are not protected in the state of New
York or under Federal Sarbanes Oxley laws but are protected by state
whistleblower protection laws in other states such as California and New
Jersey. Whistleblowers who are protected and have the courage to speak
up are critical for preventing material losses and fraud and thus guard-
ians of the public interest.
LEGISLATIVE HISTORY:
2024 S.8842
FISCAL IMPLICATIONS:
EFFECTIVE DATE:
Immediately
Statutes affected: S502: 740 labor law, 740(2) labor law