New York Court Strikes Down Limits On Executive Compensation At For-Profit Human Service Organizations

On April 9, 2014, the Nassau County Supreme Court struck down a 2013 state regulation limiting executive compensation at for-profit human service provider organizations holding state contracts. The ruling came in Agencies for Children’s Therapy Services, Inc. v. New York Department of Health (DOH). The court said the state had no authority to regulate executive compensation at for-profit state contractors; DOH and the Governor had overstepped their authority by creating policy that the legislature had not authorized. The state is expected to appeal.

In January 2012, Governor Cuomo issued Executive Order (EO 38), which directed multiple state . . .