Testimony of the Real Estate Board of New York Before the Committee on Consumer Affairs and Business Licensing in Opposition to Legislation in Relation to Private Employees Disconnecting from Electronic Communications During Non-Work Hours, Int. 726

REBNY appreciates the Council’s interest in taking steps to improve the work-life balance of New York City’s private sector workforce. However, REBNY is opposed to Int. 726, which would place untested and vague regulatory requirements on New York City employers while failing to accomplish the goal of helping workers make full use of their time outside of the office.

According to a 2015 report from the Office of the New York City Comptroller, among America’s 30 largest cities, New Yorkers spend the 12th most time at work, working an average of 42 hours and 50 minutes per week.[i] Given these relatively long periods in the office, Int. 726 purports to improve employees time out of the office by making it unlawful for an employer to require an employee to respond to electronic communication outside of the employee’s usual work hours. In doing so, the legislation requires employers to establish a written policy that defines the usual work hours for each class of employee, prohibits employers from retaliating against employees, and sets monetary penalties that can be imposed on employers for violation the bill’s requirements.

If enacted, Int. 726 would impose a regulatory system that has never been used in the United States. It would do so in a city whose employers include some of the nation’s largest multinational companies in sectors including real estate, finance, law, accounting, technology, media, and more. These firms make up a significant share of the city’s tax and employer base and rely on their employees to be accessible to provide services to their clients and successfully run their businesses across the globe. Given that no other U.S. jurisdiction has adopted regulations similar to Int. 726, it is unwise to use New York City as a testing ground for such a novel regulatory regime.

The provisions of Int. 726 do not recognize the reality of the modern economy. The only flexibility provided by Int. 726 is the stipulation that employees may be required to respond to employer communications in cases of emergency. However, emergency is defined incredibly narrowly and does not reflect the reality of businesses operating in New York City. For instance, is an overflowing toilet at 7 p.m. or broken refrigerator at 6 a.m. sufficient to be considered an event that requires “immediate action to avert, control or remedy harm?” Unfortunately, the legislation does not specify whether those scenarios would be emergencies that could provide employers with the confidence that they would get a response from their employees should those situations occur.

At a time when the global economy is becoming increasingly interconnected, the legislation fails to account for the reality that business must ensure that employees communicate with people located in other parts of the globe at unusual hours. For instance, if a real estate developer wants to schedule a call with an investor in the Tokyo, Japan, the company would have to contend with a 14-hour time change when scheduling a conversation. Successfully working across time zones requires flexibility on the part of employers and employees alike that would be undermined by this bill.

Furthermore, the requirements of Int. 726 appear to conflict with Federal and State overtime provisions that are designed to provide certain employees with flexibility in their work schedules in order to effectively run their businesses. Under both Federal and State law, employees who are classified as “executive,” “managerial,” or “administrative” are granted an exemption from overtime pay.[ii] According to the Department of Labor, this exemption for “white collar” work was premised on the idea that these workers earned salaries well above the minimum wage and that “the type of work exempt employees performed was difficult to standardize to any time frame and could not be easily spread to other workers after 40 hours in a week.”[iii] Consequently, Int. 726’s requirement that employers define usual hours of work for all employees, without regard to whether they are exempt from overtime pay requirements, would undermine the purpose of the overtime exemption. Should the Council move forward with this legislation, at a minimum it ought to carve-out employees who are exempt from overtime requirements from the bill.

Finally, REBNY is troubled by the fact that the proposed legislation applies only to private sector workers. If improving work-life balance of all New Yorkers is truly the goal of this legislation, then it ought to apply to public sector workers as well. According to the Department of Citywide Administrative Services, New York City government is one of the largest employers in the nation, on par with the likes of IBM and Target.

Far too often the City Council proposes regulatory schemes that while well-intentioned, are approved without understanding the full feasibility or consequences. We would recommend that the City Council first adopt this legislation to apply to all Council offices, and following one-year after its enactment, provide a report to the public sharing how effective the program has been for its role as an employer and for its employees. This would also allow for a strengthened public discourse on the practicalities of extending this policy to all private employers.

REBNY further encourages the Council to consider other ways of helping workers better enjoy their time out of the office. For example, as the previously mentioned Comptroller’s report documents, commuting times for New York City workers average 6 hours and 18 minutes per week, far greater than commute times in other large U.S. cities.[iv] Indeed, it is these commuting times, not normal work hours, that account for New York City workers having the longest work plus commuting times in the nation. Consequently, REBNY encourages the Council to continue its work to improve the City’s public transit system and reduce congestion as a way to lessen the City’s high commuting times and increase the amount of time New Yorkers can spend out of the office.

Thank you again for the opportunity to testify.

[i] “The Hardest Working Cities,” Office of the New York City Comptroller Scott M. Stringer, March 2015: https://comptroller.nyc.gov/wp-content/uploads/documents/Longest_Work_Weeks_March_2015.pdf.

[ii] U.S. Department of Labor Wage and Hour Division, Fact Sheet #17A:  Exemption for Executive, Administrative, Professional, Computer & Outside Sales Employees Under the Fair Labor Standards Act (FLSA): https://www.dol.gov/whd/overtime/fs17a_overview.htm. New York State Department of Labor, Overtime Frequently Asked Questions: https://www.labor.ny.gov/legal/counsel/pdf/overtime-frequently-asked-questions.pdf.

[iii] U.S. Department of Labor Proposed Rule: “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees.” Federal Register Vol. 80, No. 128, July 6, 2015, pg. 38516-38612: https://www.govinfo.gov/content/pkg/FR-2015-07-06/pdf/2015-15464.pdf.

[iv] “The Hardest Working Cities,” Office of the New York City Comptroller Scott M. Stringer, March 2015: https://comptroller.nyc.gov/wp-content/uploads/documents/Longest_Work_Weeks_March_2015.pdf.