In Spiegel v 226 Realty LLC, No. 150371/13, 2023–03102, 2805, 2024 N.Y. Slip Op. 05076, 2024 WL 4486892 (N.Y.A.D. 1 Dept., Oct. 15, 2024), the Appellate Division, First Department, unanimously reversed the lower court’s award of summary judgment to defendants on plaintiff’s whistleblower claim under New York Labor Law § 740.
Specifically, the court held that the recently-amended statute applied retroactively:
Plaintiff states that he made numerous complaints to management at the hotel where he was employed. He complained that the windows lacked safety bars and were left wide open, that a fire exit was blocked by flammable materials, and that the hotel lacked permits for construction work. Plaintiff was later terminated. Because plaintiff failed to prove that an actual violation had occurred, his claim for retaliation would not have withstood summary judgment under the Whistleblower Law in effect at the time (see Webb–Weber v. Community Action for Human Servs., Inc., 23 N.Y.3d 448, 452, 992 N.Y.S.2d 163, 15 N.E.3d 1172 [2014]). The Whistleblower Law has since been amended in this respect. It now covers activity “that the employee reasonably believes” violates law or poses a danger to the public (Labor Law § 740[2][a], as amended by L 2021, Ch 522, § 1). We have not previously determined whether this amendment applies retroactively (see Clendenin v. VOA of Am.—Greater N.Y. Inc., 214 A.D.3d 496, 497, 186 N.Y.S.3d 154 [1st Dept. 2023] [observing that the amendment became effective after the plaintiff made his complaints without addressing the unargued issue of retroactive application]).
We now find that the Whistleblower Law has retroactive application because the amendment at issue was remedial in nature (see Callahan v. HSBC Sec. [USA] Inc., ––– F.Supp.3d ––––, 2024 WL 1157075, *6, 2024 U.S. Dist. LEXIS 47106, *17-18 [S.D.N.Y., Mar. 18, 2024, No. 22–CV–8621 (JPO)]; Zhang v. Centene Mgt. Co., 2023 WL 2969309, *14–16, 2023 U.S. Dist. LEXIS 68718, *34-*42 [E.D.N.Y., Feb. 2, 2023, No. 21 CV 5313(DG)(CLP)]; see generally Matter of Gleason [Michael Vee, Ltd.], 96 N.Y.2d 117, 122, 726 N.Y.S.2d 45, 749 N.E.2d 724 [2001]; see also e.g. Matter of OnBank & Trust Co., 90 N.Y.2d 725, 730, 665 N.Y.S.2d 389, 688 N.E.2d 245 [1997]). The legislative history makes clear that the amendment was intended to correct a discrepancy created by the courts between Labor Law § 740 and its public employee counterpart, New York Civil Service Law § 75–b, and to ameliorate the restrictive language of the earlier version of Labor Law § 740 (see Zhang, 2023 WL 2969309, *14–16, 2023 U.S. Dist LEXIS 68718, *34-42; Callahan, 2024 WL 1157075, *6, 2024 U.S. Dist LEXIS 47106, *17-18; see also Gleason, 96 N.Y.2d at 122–123, 726 N.Y.S.2d 45, 749 N.E.2d 724; Nelson v. HSBC Bank USA, 87 A.D.3d 995, 998, 929 N.Y.S.2d 259 [2d Dept. 2011]). The amendment does not create a new cause of action but “merely lessens the burden for plaintiffs to bring a claim” (Pisano v. Reynolds, 2023 N.Y. Slip Op. 31741[U], *5, 2023 WL 3601527 [Sup. Ct., N.Y. County 2023]; see People v. Allen, 198 A.D.3d 531, 532, 156 N.Y.S.3d 171 [1st Dept. 2021], appeal dismissed, lv dismissed 38 N.Y.3d 996, 168 N.Y.S.3d 3, 188 N.E.3d 129 [2022], appeal dismissed, lv. denied 39 N.Y.3d 928, 177 N.Y.S.3d 202, 198 N.E.3d 477 [2022]).
The fact that the amendments to the Whistleblower Law did not take effect immediately does not preclude us from holding that they are retroactive (L 2021, Ch 522, § 3; compare e.g. Gleason, 96 N.Y.2d at 122, 726 N.Y.S.2d 45, 749 N.E.2d 724; but see Gottwald v. Sebert, 40 N.Y.3d 240, 259, 197 N.Y.S.3d 694, 220 N.E.3d 621 [2023] [immediate effect “is equivocal and is not enough to require application to pending litigation” (internal quotation marks omitted)]).
Based on this, the court found that this amendment to Labor Law § 740 should be applied retroactively, and, therefore, Supreme Court should not have granted summary judgment based solely on the lack of proof of an actual violation.