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New Law Empowers Philadelphia with Authority to Close Businesses Found to Discriminate

June 26, 2017

On May 17, 2017, Philadelphia Mayor Jim Kenney signed a bill into law that gives the Philadelphia Commission on Human Relations authority to impose an additional, harsher remedy on businesses that are found to have engaged in discriminatory conduct. Specifically, the law adds a provision to the Philadelphia Fair Practices Ordinance that empowers the Commission to order businesses to cease business operations in the City for a specified period of time upon a finding that the business engaged in "severe or repeated violations without effective efforts to remediate the violations." Prior to its enactment, the Commission's authorization to impose penalties was limited to injunctive or equitable relief to a discriminated against individual, payment of compensatory and punitive damages, and payment of reasonable attorney's fees and hearing costs. The ordinance took effect immediately.

The bill was introduced in response to complaints brought before the Commission in October alleging discriminatory practices in Philadelphia's "Gayborhood," the LGBTQ section of the City. It was signed alongside a bill that increases penalties for ethnic intimidation and institutional vandalism.

While Mayor Kenney applauded the new ordinances as "important bills . . . [confirming] that this city will not tolerate discrimination, and will use any tools necessary to combat it," the new ordinance raises uncertainty for employers who operate within the City's limits. The ordinance does not define any of its term or standards, leaving employers no guidance on what constitutes "severe or repeated violations," "effective efforts to remediate," nor how long a "specified period of time" may be. Moreover, the ordinance, which is only one short paragraph, does not differentiate between violations for discrimination in the workplace, in public accommodations or in housing and real property.

Despite its enactment in May, the ordinance was not publicized until June 22, 2017 when the Mayor ceremoniously signed it. The reaction of Philadelphia employers remains unclear, although the severe penalty is likely to be met with disapproval. The City of Philadelphia is undoubtedly authorized to impose penalties for discriminatory practices in the workplace. Whether that authority extends to ordering a complete cessation of business operations, however, is yet to be determined.

If you have any questions about this law or its effect on businesses with operations in Philadelphia, please contact Stacey Schor at (215) 640-8534 | or another member of Clark Hill's Labor and Employment Practice Group.

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