Westchester County, N.Y. recently enacted the Displaced Service Employees Protection Law (DSEPL) to provide building service workers with temporary protection from the loss of employment when their employer is replaced with a new successor employer. The law closely resembles New York City’s Displaced Building Service Workers Protection Act (DBSWPA) and is similar to laws that have been enacted in Chicago, Philadelphia, California, San Francisco, Los Angeles, and Montgomery County (MD).

The DSEPL covers any entity that employs more than 14 service employees nationwide and enters into a service contract in Westchester County to provide security, janitorial or building maintenance services at:

  • a private school, college or university;
  • an institution, such as a museum, convention center, arena, airport or performance hall;
  • a residential building or complex with more than 100 units, provided that at least one individual building at a complex has more than six units; or
  • a commercial building or complex occupying more than 100,000 square feet.

Service employees afforded protection under the law include a janitor, security officer, door person, building cleaner, porter, handyperson, superintendent, elevator operator, window cleaner, stationary fireperson or building engineer who has been regularly assigned to the location for at least 90 days prior to the change in employers. The law, however, does not include: (1) a managerial or professional employee; (2) an employee whose regular straight-time hourly wage is more than $25 per hour; or (3) an employee who is regularly scheduled to work less than 20 hours per week.

Under the DSEPL, a successor employer of building service employees is required to extend a written offer of employment to the predecessor employer’s incumbent employees and retain such employees for a period of 60 days, subject to the existence of just cause or a change in the number of employees needed to perform the applicable work. At the conclusion of the 60-day period, the just cause protection no longer applies, and any continued employment shall be under the successor employer’s policies and applicable law. In order to facilitate the successor employer’s retention obligations, the DSEPL requires that the awarding authority to provide certain notifications to the successor employer, affected employees and any collective bargaining representative at least 15 days before terminating any service contract.

The DSEPL is enforced through a private right of action in New York Supreme Court for employees who have been discharged or not retained in violation of the law. The court may order injunctive relief, as well as a damage award that includes back pay, cost of benefits the successor employer would have incurred if it had complied with the law, attorneys’ fees and costs, and any damages caused by the awarding authority’s failure to comply with its obligations.

For those familiar with New York City’s DBSWPA, it is important to note some important distinctions between the DBSWPA and Westchester’s DSEPL. Among other differences, the DSEPL: (1) provides 60 days of job protection, as opposed to the DBSWPA’s 90-days; (2) does not include an opt-out provision if the successor employer agrees to assume a valid bona-fide collective bargaining agreement; (3) only applies to residential buildings/complexes with more than a 100 units, as opposed to 50 units under the DBSWPA; and (4) does not require a written job performance evaluation at the conclusion of the job protection period.

Employers should be mindful of the potential interplay between Westchester's DSEPL and the successorship analysis utilized under the National Labor Relations Act (NLRA). Under the NLRA, an employer that (1) acquired substantial assets from a predecessor employer, (2) continued, without interruption or substantial change, the predecessor's business operations, and (3) hired a majority of its employees from the predecessor employer’s workforce likely will be considered a successor and, as such, must bargain with the predecessor’s union for a new collective bargaining agreement after setting the initial terms of employment. In certain situations, if the successor employer does not inform the employees of new terms and conditions of employment before hiring them, the successor employer may be deemed a “perfectly clear successor” that must assume the predecessor’s collective bargaining agreement.

The District Court for the Eastern District of New York, however, previously has ruled that the New York City DBSWPA’s 90-day retention requirement cannot, in and of itself, cause a subsequent employer to be deemed a successor obligated to bargain with the existing union under the NLRA. Paulsen v. GVS Properties, LLC, 2012 U.S. Dist. LEXIS 162125, 1-cv-04845 (E.D.N.Y. November 13, 2012). The court held that the NLRA’s successorship analysis should occur after the DBSWPA’s 90-day retention requirement because only after that period can the employer make the voluntary decision to hire employees that can cause it to be a successor. Even though Westchester is not within the Eastern District’s jurisdiction, Westchester County building service employers should consider the interplay between the DSEPL and the NLRA in light of the Paulsen decision.