California is known as one of the most progressive, pro-employee states in the country. But if the last several months are any indication, Illinois is quickly catching up.
Here’s a quick overview of what’s happening in the prairie state:
Illinois Wage Payment and Collection Act
What’s New? As of January 1, 2019, employers must reimburse employees for all “necessary” expenses. So what’s a necessary expense? Anything required of the employee in the discharge of his/her employment duties that “inure to the primary benefit of the employer.” Computers, cell phones, uniforms, etc. may all constitute “necessary” expenses that the employer is required to reimburse.
Takeaway: Employers should review their policies, job descriptions, and third party contracts to determine which positions/roles may result in necessary expenditures.
Illinois Nursing Mothers in the Workplace Act
What’s New? Effective August 21, 2018, the amended Illinois Nursing Mothers in the Workplace Act requires employers to provide “reasonable” paid breaks to mothers for nursing or expressing within one year of the child’s birth. The breaks may run concurrently with any other break time but the employer cannot reduce the employee’s pay for the time used for nursing or expressing. An employer may only refuse to provide these breaks if doing so would cause an “undue hardship” on the company. This is a much more demanding standard than before, when the employer could refuse the break if it would “unduly disrupt the employer’s operation.”
Takeaway: Employers should provide nursing mothers with reasonable paid breaks as we expect it will be very difficult to establish that doing so would cause the employer undue hardship.
Illinois Cannabis Regulation and Tax Act
What’s New? Effective January 1, 2020, recreational marijuana use will be legal in Illinois. But the legalization law is careful to note that recreational legalization doesn’t void employers’ rights to implement and enforce otherwise permissible policies regarding the use of cannabis in the workplace or while employees are on call.
Specifically, the legalization law provides that:
- Employers can still adopt and implement reasonable zero-tolerance or drug-free workplace policies, including policies concerning drug testing, consumption, storage or use of cannabis in the workplace or consumption of cannabis while on-call.
- Employers may still discipline or terminate an employee based on an employer’s good faith belief that an employee is impaired or under the influence of cannabis, and employees do not have a legal right of action against an employer for doing so.
- An employer may consider an employee to be impaired by or under the influence of cannabis if the employer has a “good faith belief” that an employee manifests specific, articulable symptoms while working that decrease or lessen the employee’s performance.
- This includes an employer’s observation that an employee exhibits symptoms of altered physical dexterity, agility, coordination, and demeanor, or that the employee exhibits irrational or unusual behavior, or negligence or carelessness in operating machinery or equipment.
- Crucially, an employee must be given a “reasonable opportunity” to contest the employer’s determination that an employee worked while impaired by or under the influence of cannabis.
- Employers are shielded from liability for taking an adverse employment action against an employee based on a good faith belief “that an employee used or possessed cannabis in the employer’s workplace or while performing the employee’s job duties or while on call in violation of the employer’s employment policies.”
- The legalization law should not be interpreted to interfere with an employer’s obligations to comply with any other state or federal laws, such as substance use requirements for employers that are federal government contractors.
Takeaway: Cannabis is now a lawful product, and should not by itself be the reason an employer disciplines or terminates an employee who is off duty, not on call, outside of work hours, and off the employer’s premises. Employers should evaluate their drug-free workplace policies to make sure they expressly cover cannabis usage in the workplace or while an employee is on call. Employers should also train management and other supervisory personnel to pick up on the symptoms of cannabis use and coach such personnel to adequately document such employee use, to support any disciplinary action for such use.
Amendments to the Illinois Equal Pay Act
What’s New? Before January 1, 2019, the Illinois Equal Pay Act (IEPA) only applied to gender-based pay disparities. The Amendment grants specific protections for African-Americans by expressly prohibiting employers from paying African-American employees who are performing “the same or substantially similar work” less than other employees. The Amendments also maintain that employers may not “discriminate” on the basis of sex by paying wages to an employee less than employees of the opposite sex who perform the “same or substantially similar work.”
The amended IEPA also adds certain employer defenses, falling in line with its federal counterpart, the Equal Pay Act. Employers can defend against pay disparities based on seniority, earnings, merit, quantity or quality of production, or any other non-discriminatory fact that:
- Is not derived from a differential in compensation based on sex or another protected characteristic;
- Is job related and consistent with business necessity; and
- Accounts for the differential.
But that’s not all! HB834 recently passed the Illinois legislature and will *likely* be signed into law by Governor Pritzker. The protections it adds include:
- Freedom to Discuss Wages: employers cannot require employees to enter contracts prohibiting them from discussing their wages, salary, benefits or other compensation. However, there’s an exception for Human Resources Professionals, who cannot disclose other employees’ information without the employee’s prior written consent.
- Salary History Ban: an employer cannot:
- Screen job applicants based on current or past wages or salaries;
- Request or require a wage or salary history from the applicant in order for the applicant to be considered for an interview or for employment; and
- Request or require that an applicant disclose wage or salary history as a condition of employment.
Takeaway: While it’s still fair game to ask candidates about salary expectations, employers should tread lightly around the topic. Importantly, there is no violation for the candidate’s voluntary and unprompted disclosure of wage information, so long as the employer does not consider or rely on the disclosure when making hiring or employment decisions.
Illinois Minimum Wage
What’s New? On January 1, 2020, the state-wide minimum wage will increase to $9.25, and remain there until July 1, 2020 when it increases to $10.00. The minimum wage thereafter increases by $1 each subsequent year until it reaches $15.00.
- Cook County, Illinois has a higher minimum wage. As of July 1, 2019, non-tipped employees are entitled to $12.00/hour, while the base wage for tipped employees is $5.25/hour. Note that Cook County “Home Rule” municipalities are legally permitted to “opt out” of the Cook County minimum wage requirements and comply only with the state requirements. Dozens of municipalities have opted out, creating a complicated patchwork of employer pay requirements. As the Illinois state minimum wage continues increasing, however, it will be futile to opt out, as the Cook County minimum wage will soon mirror the state minimum wage with its annual increases.
- Chicago’s minimum wage is even higher. As of July 1, 2019, non-tipped employees receive a minimum wage of $13.00.
Takeaway: Keep in mind that after January 1, 2020, the increases go into effect every July 1. If you are in Cook County, or Chicago, your employees are entitled to an even higher minimum wage than the state requires.
Impact of #MeToo on Illinois Law
What’s New? We previously reported on the impact of #MeToo in California (read more HERE) and Illinois is following suit with a number of new regulations.
The Workplace Transparency Act (WTA) will likely place greater limitations on Illinois employers in 2020. While not yet law, it is quite likely that Governor Pritzker will sign the legislation imminently. As it stands now, here are some of the major changes ahead:
- Confidentiality – agreements between employers and employees (including severance, separation or settlement agreements) cannot include nondisclosure or non-disparagement clauses for claims of harassment or discrimination. Is there an exception? Yes, if four conditions are met:
- The claim at issue arose before the execution of the agreement;
- The parties both agree to the nondisclosure/non-disparagement clause;
- The employee/applicant has 21 days to consider the agreement; and
- The employee/applicant has 7 calendar days following his/her execution to revoke the agreement.
- Arbitration Agreements – the WTA will prohibit arbitration of any discrimination or harassment claim as provided by the Illinois Human Rights Act Section 2-102 or Title VII, unless the employee chooses to arbitrate the claim (i.e. the employee has a right, but not an obligation, to arbitrate). Such claims must be expressly carved out from arbitration agreements. The WTA also precludes employers from enforcing class action waivers. This is squarely inconsistent with the US Supreme Court’s Epic Systems v. Lewis ruling in 2018.
- Greater Protections for All Workers – the WTA amends the Illinois Human Rights Act (IHRA) in two critical ways. First, the IHRA will cover perceived discrimination and/or harassment based on any protected characteristic, not just disability claims. In other words, the WTA makes it illegal to discriminate against an employee if the employee is perceived to be part of a protected class (i.e. gender, sexual orientation, ethnicity), even if he/she is not. Second, the IHRA will now extend to non-employees (e.g. independent contractors, consultants, etc.).
- Mandatory Reporting – employers must disclose to the Illinois Department of Human Rights any settlement, adverse judgment or adverse administrative ruling against them for sexual harassment and/or discrimination.
- Training – employers must provide annual sexual harassment prevention training to all employees.
- Treatment Leave – the WTA amends the Illinois Victims’ Economic Security and Safety Act to include sexual harassment among the qualifying reasons for taking leave.
In addition, two related laws are pending and on the horizon:
- The Restaurant Anti-Harassment Act would add additional training requirements for employees of bars and restaurants, including the obligation to have written sexual harassment policies.
- Similarly, the Hotel and Casino Employee Safety Act would require hotels and casinos to adopt anti-sexual harassment policies to protect their employees against sexual assault and harassment by guests. These employers must also provide panic button devices to certain employees.
The amended IHRA includes several additional employee-friendly provisions:
- Deadlines – the charge filing deadline changed from 180 days to 300 days. This will mirror the federal requirement.
- Opt-Out Procedure – it will be easier for employees to have their day in court. Employees may opt out of the Illinois Department of Human Rights’ investigation process after 60 days from the date the Department provides notice of the right to opt out.
- Employer of “one” – the IHRA will apply to any person employing one (instead of 15) or more employees.
- New Protected Class – the amendment adds “arrest record” as a prohibited basis for discrimination.
Illinois Artificial Intelligence Video Interview Act
What’s New? As we previously reported (see HERE), lawsuits under the Illinois Biometric Information Privacy Act are moving through the court systems like wildfire. But if you thought biometric identifiers weren’t enough, there’s more.
On May 29, 2019, Illinois became the first state to regulate the use of artificial intelligence by employers. Under the Artificial Intelligence Video Review Act, employers that use AI technology to evaluate and analyze video job interviews must take the following steps before requesting the video interview:
- Notify the candidate before the interview that AI may be used to analyze the video interview and consider the candidate’s fitness for the position;
- Provide the candidate with information before the interview that explains how AI works and what general characteristics it uses to evaluate the candidate; and
- Obtain, before the interview, the candidate’s consent to be evaluated by AI.
Even with consent, the employer’s responsibilities don’t end there. The Act also prohibits employers from sharing the candidate’s video “except with persons whose expertise or technology is necessary in order to evaluate an applicant’s fitness for a position.” If the candidate requests, the employer must also delete the video within 30 days of receipt of the request, and further instruct anyone else who received copies of the video to do the same, “including all electronically generated backup copies.” Governor Pritzker is expected to sign the new law soon.
Illinois lawmakers are on a mission to increase and maintain employee protections… and they’re not slowing down. The pending legislative “maybes” outlined above become legal obligations as soon as Governor Pritzker puts pen to paper. But don’t wait – review your employment policies TODAY and begin to calibrate robust, comprehensive training for your workforce, particularly for HR professionals.
Please reach out to your Baker McKenzie lawyer for more details.