On July 6, 2010, the Second Circuit Court of Appeals held that pharmaceutical sales representatives employed by Novartis Pharmaceuticals Corp. (“Novartis”) are not exempt from the overtime pay requirements of the Fair Labor Standards Act (“FLSA”) as either “outside sales” or “administrative” employees. In so doing, the Court determined that the Secretary of Labor’s interpretations of the regulations promulgated under the FLSA defining “outside sales” and “administrative” employees, as set forth in the Secretary’s amicus brief , were entitled to “controlling” deference.
The Second Circuit rejected Novartis’ argument that its sales reps “made sales” within the meaning of the “outside sales” regulations because the reps only promoted a drug to a physician. They could not lawfully take an order for its purchase or obtain a binding commitment from the physician to prescribe the drug to a patient. While the sales reps provided physicians with free samples, Novartis sold its drugs to wholesalers, which then sold them to pharmacies, and the pharmacies ultimately sold the drugs to the patients who had prescriptions for them. Accordingly, since the sales reps did not “make sales,” they were not “outside salespeople” within the meaning of the FLSA and the regulations.
The Court also agreed with the Secretary of Labor that the sales reps were not “administrative” employees under the FLSA because the marketing skills “gained and/or honed” through Novartis training sessions did not demonstrate that the sales reps were “sufficiently allowed to exercise either discretion or independent judgment in the performance of their primary duties.”
Writing for the Court, Judge Amalya L. Kearse acknowledged that a number of federal district courts have held that pharmaceutical sales reps are exempt under the outside sales and/or administrative exemptions, but responded that “[t]hose cases are, of course, not binding on us, and their reasoning does not persuade us that the Secretary’s interpretations of the regulations should be disregarded.” Judge Kearse added, “[t]o the extent that the pharmaceuticals industry wishes to have the concept of ‘sales’ expanded to include the promotional activities at issue here, it should direct its efforts to Congress, not the courts.”
As summer nears, employers may be asked by college students about unpaid internship opportunities. Unpaid internships frequently benefit both the employer and the student. The student gains real-life experience, resume enhancement, networking opportunities, and perhaps a step toward a paid position after graduation. The employer has a low cost opportunity to evaluate a potential applicant. But employers must exercise caution in the way the internship program is set up and in the functions the intern performs.
The U.S. Department of Labor (“DOL”) recently issued a new Fact Sheet reminding employers that unpaid interns may be “employees” under the Fair Labor Standards Act (“FLSA”), the federal minimum wage and overtime law. For employers considering unpaid internships, the key question is whether the unpaid intern is “suffered or permitted” to work within the meaning of the FLSA. DOL stresses that in the “for-profit” sector, internships will most often be viewed as employment. However, there is a narrow exception for training programs. DOL has identified six criteria which must exist to satisfy the exception:
The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
The internship experience is for the benefit of the intern;
The intern does not displace regular employees, but works under close supervision of existing staff;
The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded;
The intern is not necessarily entitled to a job at the conclusion of the internship; and
The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.
In determining whether an intern is really an employee, DOL distinguishes those experiences that are similar to an educational environment from those that are not. If the program is structured around a classroom or academic experience, the student gets educational credit, or the experience provides skills that could be used in multiple employment settings the intern is less likely to be deemed an employee. If, however, the business is dependent on the intern’s work or the intern is performing productive work, the intern is more likely to be deemed an employee – even if the intern may receive some benefits (e.g., developing a new skill or improving work habits).
Another key consideration is workforce displacement. According to DOL, an intern is an employee if the employer would have employed additional workers or would have required existing employees to work additional hours but for taking on the intern.
A determination that an unpaid intern is, in fact, an employee can have consequences beyond minimum wage and overtime obligations. Discrimination laws, worker’s compensation coverage, state and federal tax laws, employee benefits and unemployment insurance coverage are all implicated in the event of a misclassification. Because the impact of a potential misclassification is so significant, before accepting any unpaid interns an employer, in particular, a for-profit employer, should, at a minimum, take the following steps:
Provide an agreement or letter making it clear there is no pay and no guaranteed job in the future;
Adopt a policy that sets up strict supervision of the internship program and the intern and assigns a mentor;
Train supervisors and managers regarding the limits of what interns are permitted to do;
Ensure the primary benefit of the internship is for the student, not the employer -- minimize assigning the same duties given to regular employees, and do not use interns to displace any employees;
Arrange for a structured program of internal and, if possible, external instruction; and
If possible, formalize arrangements with the intern’s college or university, and ensure that the work is being done for college credit.
Section 193 of the New York Labor Law prohibits employers from making deductions from an employee’s wages, except for certain deductions made for the benefit of the employee which are authorized by the employee in writing in advance, such as deductions for employee contributions to employee benefit plans. It also prohibits separate transactions between the employee and employer which would amount to the same thing as a prohibited deduction. In a surprising and disappointing change of direction, the New York State Department of Labor (“NYSDOL”) now takes the position that deductions from an employee’s wages for money owed to the employer (e.g., a loan, or overpayment of wages) are prohibited by Section 193 even with the employee’s written consent, because they are not similar to the types of permissible deductions enumerated in Section 193.
In addition, while it is permissible for an employer to ask an employee to pay the money back, if the employer threatens the employee with discipline for failure to pay back the money, NYSDOL will consider that conduct to be a prohibited separate transaction under Section 193. In fact, NYSDOL states that in making such a request the employer must clearly communicate that the employee’s refusal will not result in discipline or retaliatory action. NYSDOL believes that a legal proceeding to collect the money is the employer’s only legal recourse if the employee voluntarily fails to repay.
Employers often assume that because an employee performs “professional” work she must be an exempt professional under the Fair Labor Standards Act (“FLSA”). Late last year, the United States Court of Appeals for the Second Circuit issued a decision which serves as a valuable warning to employers who make that assumption, Young v. Cooper Cameron Corp. For those of you who may not know or recall what the professional exemption is all about, here is a quick primer. The FLSA’s overtime provisions do not apply to exempt professionals. An exempt professional is one who, among other things, is “employed in a bona fide professional capacity.” The FLSA does not define that term any further. But the U.S. Department of Labor (“DOL”) has issued extensive regulations on the subject. In the Young case, the Second Circuit’s interpretation and application of these regulations revealed a common employer mistake: Just because the position seems like a “professional” position does not mean it falls within the professional exemption. In this case, the plaintiff was performing a type of engineering design work on a pretty sophisticated piece of equipment used on oil drilling rigs. While he had 20 years of engineering-type experience, he had only a high school degree. Nevertheless, based on the amount of his engineering experience and the type of work he was performing, the employer classified him as exempt.
The employer got it wrong. As the Court observed, DOL’s regulations are quite clear: one of the requirements for the exemption is that the work must be in a field of science or learning customarily acquired by a prolonged course of specialized study, and the best evidence of this is a specialized academic degree. The crux of the dispute then centered around the term “customarily,” the employer arguing that use of that term showed an academic degree was not required in all circumstances and that the plaintiff’s engineering experience was an adequate substitute. Under the employer’s view, the lack of a degree requirement for the position did not matter, because the duties of the position required knowledge of an advanced type. The Second Circuit disagreed, noting that the regulations dealt with that issue as well. The Court concluded that “customarily” means a specialized degree is required in the vast majority of cases. In the Court’s view, this means that a rare individual could still be exempt without having a degree, but only in a situation where other individuals performing the work typically held such a specialized degree. As the Court observed, the term “customarily” does not mean that the degree requirement can simply be ignored in favor of focusing solely on the type of work being performed. In the case before it, the plaintiff was not the only employee holding the engineering position and no one who held it had anything more than a high school degree. As a result, it could not be said that advanced education in a specialized field was customarily required for the position.
The lesson for employers is clear: in order for the professional exemption to apply, the duties performed must require use of knowledge of an advanced type in a field of science or learning and the position must typically require an advanced degree in that specialized field of science or learning. Having the right duties alone is not sufficient.
On a side note, the plaintiff apparently did not complain about being treated as exempt until he lost his job in a reduction in force after holding the position for three years. This in itself is a small lesson in how exemption issues can pop up unanticipated.
The New York State Department of Labor (“NYSDOL”) recently posted guidelines and instructions on its website addressing employer obligations under New York Labor Law § 195(1). This recently amended statute requires employers to notify newly-hired employees in writing of their pay rates, pay dates, and, if applicable, overtime rates. The statute also requires employers to obtain written acknowledgments from new employees confirming receipt of this information.
Consistent with its earlier reversal of position, NYSDOL’s guidelines and instructions state that use of the new model forms is not mandatory at this time. Rather, according to the guidelines, employers may create their own forms, or use or adapt the model agency forms, as long as: (a) the required information is given at the time of hiring, before any work is performed; (b) the employee is given a copy; and (c) the employee signs an acknowledgment of receipt, which the employer must retain for six years.
Several additional aspects of the new materials are also noteworthy. First, NYSDOL takes the position that notices to exempt employees —which apparently include employer-created notices—“must state the specific exemption that applies.” This requirement does not appear in Section 195(1). Second, the new model forms do not require the preparer to certify that the contents are true and accurate under penalty of perjury, which represents a change from the original one-size-fits-all form previously published by the agency. Third, the NYSDOL guidelines discuss how employers can craft written notices for commissioned salespersons, which will satisfy both Section 195(1) and Section 191(1)(c) of the New York Labor Law. Section 191(1)(c) requires that the terms of employment for commissioned salespersons (how wages, salaries, drawing accounts, and commissions are calculated) be reduced to a writing.
In recessionary times like these, employers often rely more heavily on independent contractors to avoid the personnel costs associated with hiring regular employees. Doing so, however, creates risks. Now is a good time to make the effort to determine whether your independent contractors are really independent contractors. Just don’t expect the answer to come easily.
The issue of who is properly classified as an independent contractor (as opposed to employee) has been giving employers headaches for decades. As the United States Supreme Court noted over 60 years ago: “Few problems in the law have given greater variety of application and conflict in results than the cases arising in the borderland between what is clearly an employer-employee relationship and what is clearly one of independent entrepreneurial dealing.” N.L.R.B. v. Hearst Publication, 322 U.S. 111, 121 (1944). It is little wonder that even the Supreme Court is troubled by this legal issue given the difficulties involved in the analysis. For starters, courts and government agencies (both state and federal) use different legal tests to make this determination. As a result, a single set of facts can produce different legal conclusions. Moreover, none of the tests utilized relies on definitive factors. As the Internal Revenue Service (“IRS”) states on its website, “[T]here is no “magic” or set number of factors that “makes” the worker an employee or an independent contractor, and no one factor stands alone in making this determination. Also, factors which are relevant in one situation may not be relevant in another.”
Although the issue is old, it has continued vitality. There has been a significant increase in litigation, government enforcement and legislation over the misclassification of independent contractors in recent years. It is equally clear that the focus on independent contractor misclassification, far from slowing down, will only continue to pick up steam. The remainder of this blog summarizes some recent developments demonstrating that employers need to be very careful when using independent contractors.
New York State’s Joint Enforcement Task Force on Employee Misclassification (“Task Force”), formed in 2007, continues to address, among other things, the problem of employers who inappropriately classify employees as independent contractors. According to the Task Force’s most recent Annual Report, it has uncovered approximately 12,300 instances of employee misclassification resulting in more than $157 million in unreported wages. Partly in response to the Report, Senate Labor Committee Chairman George Onorato, D-Queens, and Senate Insurance Committee Chairman Neil Breslin, D-Albany, renewed their push for passage of a bill which would, among other things, levy fines of up to $5,000 per employee for any construction company that misclassifies its workers as independent contractors. The bill also creates a presumption of employment status in the construction industry unless certain factors are established.
On August 21, 2009, the Massachusetts Supreme Judicial Court held in Somers v. Converged Access, Inc. that an employee who has been misclassified as an independent contractor is entitled, under Massachusetts law, to recover any wages and benefits he proves he was denied because of his misclassification, including holiday pay, vacation pay, and overtime. In so doing, the Court rejected the employer’s argument that it should not have to pay any damages because had it known the individual was an employee instead of an independent contractor, it would have paid him a lower hourly rate than he received as an independent contractor.
New York Attorney General Andrew M. Cuomo, Montana Attorney General Steve Bullock, and New Jersey Attorney General Anne Milgram have announced their intent to sue FedEx Ground Package Systems, Inc. (“FedEx Ground”) for violations of state labor laws stemming from the Company’s alleged misclassification of its drivers as independent contractors. The Attorneys General claim that such misclassification deprives drivers of workers’ compensation and other labor and employment legal protections received by FedEx Ground’s employees.
In Mohel v. Commissioner of Labor, a decision dated November 17, 2009, the New York Industrial Board of Appeals found that drivers of a limousine service were employees as opposed to independent contractors under the “right to control” test used by the New York State Department of Labor.
Finally, Beginning in early 2010, the IRS will launch an audit initiative that will audit the federal tax returns of 6,000 companies to assess compliance with tax and labor regulations. As part of this audit, the IRS will examine independent contractor misclassification. The initiative was prompted, in part, by advice from the United States Government Accountability Office to the IRS and United States Department of Labor to step up efforts to reduce the misclassification of independent contractors.
Without acknowledging that it is doing so, today the New York State Department of Labor ("DOL") changed its position on whether employers are required to use DOL’s form in order to comply with Section 195 of the Labor Law. Effective October 26, 2009, Section 195 requires employers to provide all new hires with notice of their wage rates, pay dates, and, if applicable, overtime rates. The statute also requires that employers obtain written acknowledgments from new employees confirming receipt of this information, which must conform to any "content and form" requirements established by DOL.Shortly after the effective date of the statute, DOL issued a problematic, highly controversial, one-size-fits-all form for providing that information, and mandated its use by employers for all classes of employees. Today, DOL reversed position by posting a notice on its website that states no particular form is required to comply with the statute and that DOL’s form is only a sample. Employers may create their own forms, use the DOL sample, or adapt the DOL sample form. The notice also states that DOL plans to come up with several different types of sample forms in the future, including a form for exempt employees.
Our August 11, 2009, posting explained New York’s new law requiring employers to formally notify new hires of their rate of pay, overtime rate (when applicable), and regular pay date, and to obtain a written acknowledgment from the employee that such information was provided. The law applies to employees hired on or after October 26, 2009. As we noted in the August 11, posting, the amendment to Section 195 of the Labor Law provides that the acknowledgement must conform to any requirements set by the Commissioner of Labor. The Commissioner has now provided those requirements by way of an informational fact sheet for employers and employees, and through a standard acknowledgement form. According to the fact sheet, use of the new form is mandatory. The form requires the individual providing the information to certify that it is accurate, and warns that a knowingly false statement is punishable as a misdemeanor.
Employers should begin using the new form immediately. While the new form will no doubt be adequate for most new hires, it may be difficult to use for new employees who have more than one position and pay rate, who receive incentive compensation in addition to their hourly rate, or whose pay rate can vary (for example based on shift differential). In particular, it may be difficult to use the new form accurately for new employees who work under collective bargaining agreements, which can contain a variety of different pay rates and overtime rates. Employers who have questions about accurately conveying information when using the new form should consult with counsel.
Since the Supreme Court’s decision in IBP, Inc. v. Alvarez , 546 U.S. 21 (2005), “donning and doffing” claims have been filed with increased frequency against employers in many industries. In some instances, these claims take the form of a collective and or class action. Recently, the United States District Court for the Western District of New York granted summary judgment dismissing wage and hour claims brought under the Fair Labor Standards Act (“FLSA”) and the New York Labor Law in a case defended by Bond, Schoeneck & King, PLLC (“BS&K”). Albrecht v. The Wackenhut Corp., slip op. no. 07-CV-6162 (W.D.N.Y. Sept. 24, 2009). The court’s holdings are discussed below.
The action was commenced on behalf of current and former security guards at the Ginna Nuclear Power Plant in Ontario, New York. The plaintiffs sought additional compensation for donning and doffing activities that allegedly occurred before and after their scheduled workdays; specifically, the time spent “arming up and clearing through security and arming down.” In ruling for the employer, the court acknowledged that under the Portal-to-Portal Act (an amendment to the FLSA), employers need not compensate employees for activities that are “preliminary to or postliminary to" their “principal” work activities. In Alvarez, the Supreme Court held that such activities are only compensable if they are “an integral and indispensable part of the principal activities.” In finding that the activities involved in the case before it were not “integral” to the performance of the guards’ principal activities, the Albrecht court analogized the tasks at issue to those found to be non-compensable by the Second Circuit in Gorman v. Consolidated Edison Corp., 488 F.3d 586 (2d Cir. 2007) and Reich v. New York City Transit Auth., 45 F.3d 646 (2d Cir. 1995). The court in Albrecht further ruled that the time spent arming up and arming down involved non-compensable preliminary or postliminary activities because the tasks could be accomplished with minimal effort and were not difficult or time consuming.
In addition, the court supported its ruling on an alternative ground. It held that to the extent the donning and doffing activities might otherwise be compensable, they were nevertheless de minimis in nature. Relying on the Second Circuit’s decision in Singh v. City of New York, 524 F.3d 361 (2d Cir. 2008), the court noted that the “continuous workday rule,” which generally requires inclusion of all time after the start of an employee’s workday, is not triggered when an employee engages in principal activities that are de minimis. The court observed that while there is no “bright line” test for determining how much time is de minimis, several courts have found time periods of fifteen minutes or less to be de minimis. The court then found that even if all of the pre- and post- shift activities alleged were considered, the time period at issue was de minimis under that standard.
The defendant in Albrecht was represented by Robert A. LaBerge and Christa R. Cook of BS&K. This is the second donning and doffing case in the past year in which BS&K has successfully represented the employer. In Delitta v. City of Mount Vernon, current and former police officers brought a similar suit which was withdrawn after limited discovery. Equally significant, the resolution did not require the City to pay any monies to the plaintiffs. BS&K attorneys Terrence M. O’Neil and John S. Ho represented the City in that case.
Effective July 24, 2009, the minimum salary that an employee must receive to qualify for the executive or administrative exemption from overtime pay requirements in New York increased to $543.75. It was $536.10. Because this amount differs from the exempt salary amount under the federal Fair Labor Standards Act (“FLSA”) of $455, employers in New York should evaluate their pay practices to ensure compliance with both state and federal law. The differences between federal and New York law are described below.
Common Minimum Wage and Overtime Requirements
Both New York law and the FLSA require employers to pay non-exempt employees a minimum wage of $7.25 per hour, and to pay one and one-half times the employee’s “regular rate” for all hours worked in excess of 40 in a work week. In addition, both New York and federal law provide for categories of “exempt” employees to whom the minimum wage and overtime requirements do not apply. The most common categories are executive, administrative, and professional employees. In order to satisfy the federal and state exemption criteria, such employees must be paid on a salaried basis, and they must also satisfy certain duties tests. The duties tests under the FLSA and New York law are very similar.
Differences in the Salary Amount and Its Consequences
But the salary amounts necessary to satisfy the salary basis of the exemptions are different. While New York now requires payment of a weekly salary of $543.75 for the executive and administrative exemptions, with no minimum salary for the professional exemption, the FLSA requires payment of only $455 per week for all three exemptions. The differing state and federal exemption amounts create three potential categories of employees: (1) employees who are non-exempt under both federal and state law; (2) employees who are exempt under both federal and state law; and (3) employees who are exempt under federal law, but not under state law because they only meet the salary test under federal law. (It is also possible to have a professional employee who is exempt under state law because it does not have a salary test for professionals, but who is not exempt under federal law because the professional is paid less than $455 per week.)
An employer’s overtime obligations toward employees in the first category – non-exempt – are the same under federal and state law: pay time and a half the regular rate for hours worked in excess of 40 in a week. An employer’s obligations to employees in the second category are also the same under both federal and state law: no overtime obligation because the employee is exempt under both laws.
But the third category of employees – exempt under federal law, but not state law – creates a complication. When an employee meets the duties test for the executive or administrative exemption, but meets only the federal salary test, New York’s General Wage Order, as interpreted by the New York State Department of Labor (“NYSDOL”) requires that the employee receive one and one-half times the state minimum wage (not the “regular rate”) for each overtime hour worked in a given work week, up to a cap of $543.75 in total wages for the work week. So, for example, an employee who meets the duties requirement of the administrative exemption but was paid a salary of $500 for a week in which she worked 50 hours would be entitled to $508.75. How do we get there? The regular rate is $10.00 per hour, yielding straight time pay of $400 for the first 40 hours of work. The overtime calculation is, however, based on the minimum wage, not the regular rate, so the employee is entitled to one and one-half times the minimum wage of $7.25 for the 10 hours of overtime, or 10 hours at $10.875 for a total of $108.75 in overtime. Adding the straight time pay of $400 yields a total of $508.75. So the employee is entitled to an additional $8.75 in overtime pay. While New York law requires payment of overtime at one and one half times the state minimum wage, it does not prohibit payment at one and one half times the regular rate, if the regular rate is higher than the state minimum wage.
Unfortunately, these calculations are rather complicated. In addition, this interpretation of the New York General Wage order is based on opinions issued by the NYSDOL years ago. New York employers are advised to carefully analyze their payment schemes for employees who are exempt under federal law, but who do not satisfy the New York salary test. Failure to pay overtime to an employee who is exempt under federal but not state law could result in potential liability for unpaid wages, liquidated damages, civil fines and reimbursement of attorney’s fees to claimants who commence litigation.
On August 26, 2009, Governor Paterson signed yet another bill amending sections of the New York Labor Law. This time, the amendments are designed to provide a greater deterrent effect to employers who violate the law. The two amendments are described below.
First, Sections 198(1-a) and 663 of the Labor Law have been amended to expressly authorize the Commissioner of Labor to bring legal actions, including administrative proceedings, to collect wage underpayments and to assess liquidated damages. Liquidated damages equal to 25% of the amount of underpayments may be assessed against an employer, unless the employer can demonstrate that it had a “good faith” belief that it was complying with the law. Prior to the amendment, the employee had the burden to prove that the underpayment was willful in order to collect liquidated damages. By shifting this burden of proof from the employee to the employer, the amendment is designed to make it easier for employees to recover liquidated damages.
Second, Section 215 of the Labor Law, which prohibits retaliation against employees who complain about wage underpayments and other labor law violations, was also amended. The new law increases the minimum civil penalty for illegal retaliation from $200 to $1,000, increases the maximum penalty from $2,000 to $10,000, authorizes the Commissioner to order reimbursement for lost compensation, and extends liability for retaliation to partnerships and limited liability companies.
The amendment also expands the categories of conduct protected against retaliation to include: (1) providing information to the Commissioner or his or her representative; (2) exercising rights afforded under the labor laws; and (3) an employer’s receipt of an adverse determination from the Commissioner involving the employee. Although these new categories were added to further protect employees from retaliation, it should be noted that state employees or employees of any municipal subdivisions or departments of the state are specifically excluded from protection under this section.
Both amendments take effect on November 24, 2009 and apply to violations occurring on or after that date.
Despite our State Legislature’s distractions this summer, it continues to crank out laws which further regulate New York employers. Here are some recent changes about which employers should be aware.
On July 28, 2009, New York State Labor Law 195(1) was amended to require employers to provide all new employees hired on or after October 26, 2009 with written notice of their rates of pay and the employer’s regular pay days. See our August 11, 2009 blog post for details.
Some other notifications required by New York Law include:
Terms of employment between an employer and commissioned salesperson must be in writing and signed by both parties. The agreement must include a description of how wages, salary, drawing account, commissions and all other monies earned and payable will be calculated.
Employees must be notified in writing or by public posting of the employer’s policy on sick leave, vacation, personal leave, holidays and hours.
Employers must notify employees of any changes in pay days prior to such changes.
Employers must also notify employees of the date of termination and exact date of termination of employee benefits. The notice must be in writing and be given within 5 working days after termination.
Effective July 7, 2009, the New York State Human Rights Law prohibits employers from discriminating against employees who are victims of domestic violence. See our August 3, 2009 blog post for details on this new law.
Additionally, employers should keep in mind that as of July 6, 2009, the Human Rights Law provides for civil fines and penalties, payable to the State, of up to $50,000 for unlawful discriminatory acts, and up to $100,000 for willful, wanton or malicious discrimination. Our July 20, 2009 blog post describes that amendment.
Finally, an amendment to the New York State Insurance Law “mini-COBRA” provisions, creates an extension of the general continuation under a group health plan for covered employees from 18 months to 36 months following termination of employment. The law applies retroactively to insurance policies and contracts issue, renewed, modified, altered or amended on or after July 1, 2009, but does not apply to self-funded group health plans. Although New York’s mini-COBRA statute generally covers insurance plans of employers with fewer than 20 employees, this 36 month continuation period will apply to all New York group insurance policies regardless of employer size. Therefore, if federal COBRA coverage is exhausted, qualified beneficiaries can extend coverage under New York law for an additional 18-month period up to a total of 36 months following the date of the beginning of federal COBRA coverage.
