City Human Rights Law Claims Are Not Barred By Whistleblower Law’s Election of Remedies Provision

Today Judge Reyes of the Eastern District decided Cabrera v. Fresh Direct, which narrowly interprets the waiver provision of New York’s Whistleblower Statute, Labor Law § 740.

Plaintiff initially alleged gender and disability discrimination claims under the New York City Human Rights Law.  She then sought to amend her complaint to add a § 740 claim.

That claim (according to her proposed amended complaint) was that she was discriminated against and fired for engaging in protected whistleblower activity, namely, complaining about what she perceived as “unsafe working conditions and food safety issues” at defendant.

Defendant argued that this amendment was “futile”, in light of the Whistleblower Act’s “waiver provision that would waive her existing gender and disability discrimination claims because they are premised on the same retaliatory action as the whistleblower claim.”

The Whistleblower Act’s waiver/election of remedies provision, codified at Labor Law § 740(7), provides, in pertinent part, that

[T]he institution of an action in accordance with this section shall be deemed a waiver of the rights and remedies available under any other contract, collective bargaining agreement, law, rule or regulation or under the common law.

According to defendant, this provision bars plaintiff “from asserting whistleblower and NYCHRL claims based upon the same retaliatory action.”

The court disagreed, relying in part on its decision in Barker v. Peconic Landing and highlighting the differences between the Human Rights Law, on the one hand, and the Whistleblower Law, on the other:

The purpose of the NYCHRL is to protect persons working in New York City against discriminatory employment actions based upon protected classifications such as gender or disability. … Section 740 is aimed at protecting the rights of employees who report violations of law that present a danger to public health or safety.  … Because the two causes of action seek to remedy separate wrongs, a literal reading of Section 740’s waiver provision would dictate the absurd result that when an employee brings a whistleblower suit, all concurrent or future lawsuits brought by that employee, in any capacity whatsoever, are waived. … Moreover, a narrow interpretation of the waiver provision advances the purpose of Section 740, since requiring the employee, as the price of asserting whistleblower protection, to waive any rights he might have under independent causes of action … will create a disincentive to invoking the Act’s protection, thus in turn deterring the very whistleblowing conduct that the Act intends to encourage.

The court therefore “adopt[ed] the narrow reading” of the waiver provision, and thus found that plaintiff’s proposed § 740 claim “does not waive her discrimination claims.”