Second Circuit Clarifies Remedies Available Under New York’s “Whistleblower Law”, New York Labor Law 740/741

In Pal v. New York University (Summary Order dated 9/22/14), the U.S. Court of Appeals for the Second Circuit clarified that New York’s “Whistleblower” law – New York Labor Law § 740 – only provides for “equitable” relief (such as back pay), does not allow recovery for “future or anticipated lost wages or benefits,” and does not provide the aggrieved plaintiff a right to a jury trial.

Plaintiff sued under New York’s “Health Care Whistleblower Law – New York Labor Law § 741 – alleging that NYU terminated her for retaliation for statements made to a supervisor concerning the quality of patient care. The court affirmed the district court’s judgment dismissing her lawsuit, finding no clear error in its determination that plaintiff’s termination was the sole responsibility of the Department Chairman, whom plaintiff did not contend was motivated by retaliatory animus in terminating her.

With respect to the Whistleblower Law’s remedies, the court stated:

The relief available in a § 740 suit (and thus a § 741 suit) is set out in § 740(5), which states that “the court may award relief as follows,” and then lists various types of equitable relief. N.Y. Lab. Law § 740[]. The New York state courts have therefore concluded that rather than providing for a trial by jury, section 740(5), by its express terms, states that it is the court itself which awards relief. … The remedies that Pal is seeking under New York Labor Law § 740, including back pay, are analogous to the remedies available under Title VII before the 1991 amendments made compensatory and punitive damages available, and are clearly equitable remedies under federal as well as state law. … To the extent that Pal may have sought damages not properly characterized as back pay, such damages are not recoverable pursuant to § 740. … Because New York Labor Law § 740 offers only equitable remedies, Pal was not entitled to a jury trial on her claim under New York Labor Law § 741. (Citations omitted.)

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