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The National Labor Relations Board has continued its recent spate of employee-friendly decisions with a new one that will require employers to think through work rules, policies and handbook provisions to determine whether they could–hypothetically, from an employee’s perspective–restrict an employee’s Section 7 rights. 

On August 2, 2023, the National Labor Relations Board (“NLRB” or “the Board”) issued a 3-1 split decision in Stericycle, Inc., bringing back and modifying a prior standard for assessing whether an employer’s facially neutral work rules and policies unlawfully “chill” an employee’s Section 7 rights. Under the new standard, the NLRB will peer through the lens of a “reasonable employee” (more on that below) to determine whether an employer’s work rules and policies have a tendency to restrict Section 7 rights. For employers, this means a complete reassessment of their workplace rules and policies–and the handbooks that those rules and policies are housed in.

The new standard: reasonable tendency to “chill” Section 7 rights, from the employee’s perspective

The new standard (which is the Board’s prior Lutheran Heritage standard, brought back to life and modified) requires the NLRB General Counsel to prove that a challenged work rule has a reasonable tendency to “chill” employees from exercising their Section 7 rights. (Quick reminder: Section 8(a)(1) of the National Labor Relations Act (NLRA) makes it an unfair labor practice for an employer “to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7” of the Act, including the right to form, join or assist labor unions, to bargain collectively and to engage in other concerted activities for the purpose of collective bargaining.)

How is this done? That’s the rub for employers.

As an initial matter, the Board will interpret the challenged work rule from the perspective of an employee who is (i) subject to the rule, (ii) economically dependent on the employer, and (iii) also contemplates engaging in a protected concerted activity.

In addition:

  • The employer’s intent in maintaining the rule in question is immaterial. (So even if the employer had no  intent to restrict an employee’s Section 7 rights when developing the work rule or policy–which we suspect will usually be the case–it isn’t material.)
  • The General Counsel will carry her burden if an employee (that same employee described above) could reasonably interpret the rule to have a coercive meaning–even if a contrary, non-coercive interpretation of the rule is also reasonable. All emphasis is ours here, to highlight that the General Counsel’s burden is extraordinarily low. If the General Counsel carries her burden, the challenged work rule is presumptively unlawful.
  • BUT, employers have a chance at rebutting the presumption. The presumption can be rebutted if the employer can prove that the rule advances a legitimate and substantial business interest and that the employer cannot advance that interest with a more narrowly tailored rule. If the employer proves this, the work rule will be found lawful.

What does this mean for employers?

The Stericycle standard has the potential to render a multitude of employment policies and workplace rules unlawful, and will be applied retroactively. Employers should review existing (or new) employee work rules, policies, and handbook provisions to ensure:

  • They are tailored as narrowly as possible to advance the employer’s interest, and to refrain from restricting an employee’s Section 7 rights
  • They explicitly state employees have the right to engage in concerted activities under Section 7
  • Where necessary, they provide an explanation of how the rule or policy does not preclude employees from exercising their Section 7 rights
  • Where possible, they include a list of specific rights the employer is not intending to restrict. Talk to us for recommended language.

Continue Reading Handbook Review Takes on a New Meaning: NLRB Adopts “Employee-Friendly” Standard for Evaluating Workplace Rules

As forecasted in our recent blog Illinois Employer Midsummer “Roundup”: Eight to Know and Two to Watch, our two bills “to watch” are now law. On August 4, Governor Pritzker signed HB 2862 into law, effective immediately, imposing new obligations on employers who use temporary employees, including providing information on their regular employees’ compensation to staffing companies and documenting and keeping records of training provided to the staffing company employee.

And on August 11, Governor Pritzker signed HB 3129 into law, meaning Illinois employers with 15 or more employees have to include the “pay scale and benefits” in any job posting starting January 1, 2025.

We highlight a few key points of each new law below, and for more details, check out our Illinois Midsummer “Roundup” blog.Continue Reading Illinois Employers: Two Bills We Told You to Watch Are Now Law

Splitting the baby on 50 years of precedent, the U.S. Supreme Court (SCOTUS) has clarified that employers must grant a religious accommodation request under Title VII of the Civil Rights Act of 1964 (Title VII) unless the accommodation would result in “substantial increased costs in relation to the conduct of [their] particular business.” On June…

The Illinois Supreme Court just handed union employers with broad management rights clauses in their collective bargaining agreements (CBA) a win. On March 23, 2023 the Illinois Supreme Court affirmatively answered a certified question (Does Section 301 of the Labor Management Relations Act preempt BIPA claims asserted by bargaining unit employees covered by a collective…

As predicted, Governor Pritzker signed the “Paid Leave for All Workers Act” into law on Monday, March 13. Accordingly, beginning January 1, 2024, Illinois employers must provide most employees with a minimum of 40 hours of paid leave per year to be used for any reason at all–not just for sick leave.

On February 21, the National Labor Relations Board (NLRB) issued a decision in McLaren Macomb holding that employers may not offer employees separation or severance agreements that require employees to broadly waive their rights under the National Labor Relations Act (NLRA). In McLaren, a hospital furloughed 11 employees, presenting each with a severance agreement and general release that contained confidentiality and non-disclosure provisions. (See the exact provisions copied below.) The Board majority held that merely “proffering” a severance agreement containing unlawful confidentiality and non-disparagement provisions violated the NLRA because conditioning the receipt of benefits on the “forfeiture of statutory rights plainly has a reasonable tendency to interfere with, restrain, or coerce the exercise of those rights.”

At first blush, this may feel like a sweeping change requiring immediate action. However, it is important to consider this decision with a grain (or two) of salt, breathe and thoughtfully plan your next steps. The key points identified below are designed to help you think through a tailored approach for your organization¾there is not a one-size-fits-all solution. Your approach will depend on the type of workforce you have, your risk tolerance and what you are trying to protect. We are standing by, ready to assist, should you need further guidance.

Key Points

  • For most private, nonunion employers, the risk of an unfair labor practice charge is relatively low. While it is absolutely true that the NLRA does indeed apply to most private sector employers, the NLRB and unions tend to focus more on unionized workplaces. (If you have a unionized or partially unionized workforce, the risk is higher but read on.)

Continue Reading You’ve Heard That The NLRB Restricted The Use of Confidentiality & Non-Disparagement Provisions In Separation Agreements. Here’s What Employers Need To Do About It.

Illinois employers, do you utilize any workforce monitoring or security measures, such as time clocks, that involve individuals’: 

  • Fingerprints
  • Retina or iris scans
  • Scans of hand or face geometry
  • Voiceprints
  • Biometric information (information based on the above that is used by the company to identify an individual)

If so, read ahead because the Illinois Supreme Court just decided that doing so, without strict compliance with the Illinois Biometric Information Privacy Act (BIPA), could be a multi-billion dollar mistake.

In Cothron v. White Castle System, Inc. (issued February 17, 2023), the Court held that a separate BIPA claim accrues each time a private entity scans or transmits an individual’s biometric identifier or information in violation of section 15(b) or 15(d) of BIPA–not just the first time. Employers subject to BIPA now have no margin of error, because noncompliance with sections 15(b) or 15(d) of BIPA could mean cost-prohibitive–even ruinous–damages for the company.Continue Reading BIPA Liability in the Billions? Illinois Employers Beware: Claims Accrue with EACH Separate Scan or Transmission

Employers will now have to contend with a five-year statute of limitations for all employee claims under the Illinois Biometric Information Privacy Act (BIPA). On February 2, 2023, in Tims v. Black Horse Carriers, the Illinois Supreme Court held that a five-year statute of limitations applies to all BIPA claims—even those that are tied to the publication of an individual’s data and could presumably be subject to a one-year limitations period “for publication of matter violating the right of privacy.” The Court held that the legislative intent and purpose of BIPA, and the fact that BIPA does not have its own statute of limitations, favor all BIPA claims being subject to the state’s “catchall” five-year limitations period.

What happened

Plaintiff Tims filed a class-action complaint against his former employer, Black Horse, alleging that Black Horse violated section 15(a) of BIPA (providing for the retention and deletion of biometric information), and sections 15(b) and 15(d) of BIPA (providing for the consensual collection and disclosure of biometric identifiers and biometric information). Specifically, Tims alleged that Black Horse required its employees to use a fingerprint authentication time clock, and that Black Horse violated BIPA because it (1) failed to institute, maintain, and adhere to a publicly available biometric information retention and destruction policy required under section 15(a); (2) failed to provide notice and to obtain employees’ consent when collecting their biometrics, in violation of section 15(b); and (3) disclosed or otherwise disseminated employees’ biometric information to third parties without consent in violation of section 15(d).

Black Horse moved to dismiss the complaint as untimely, arguing that it was barred by the one-year statute of limitations in section 13-201 of the Illinois Code of Civil Procedure (Code). Black Horse argued that claims brought under BIPA concern violations of privacy, therefore the one-year limitations period in section 13-201 governing actions for the “publication of matter violating the right of privacy” should apply to such BIPA claims.

The circuit court rejected Black Horse’s argument, and denied the motion to dismiss. In doing so, the court held that violations of all three sections of BIPA were subject to Illinois’ “catchall” five-year limitations period in section 13-205 of the Code.

The appellate court, however, distinguished the applicable statute of limitations under BIPA based on the type of violation alleged. It held that violations of section 15(c) (prohibiting the sale, lease, trade or other profit from biometric information) and 15(d) (prohibiting the disclosure, redisclosure or dissemination of biometric information) were subject to the one-year limitations period in section 13-201 of the Code, while violations of section 15(a) (requiring a written policy with a retention schedule and guidelines for destroying biometric information), 15(b) (requiring notice and the specific purpose and length of collection of biometric information prior to collection), and 15(e) (requiring confidentiality and protective measures in the storage and transmission of biometric information) were subject to the five-year “catchall” limitations period in section 13-205.Continue Reading One Limitations Period for All: Illinois Supreme Court Holds All Claims Under BIPA Have a Five-Year Statute of Limitations

This year has started with a bang for Illinois employers. Days into 2023, the legislature passed the Paid Leave for All Workers Act (the “Act”), which would require Illinois employers to provide most employees with a minimum of 40 hours of paid leave per year to be used for any reason at all–not just for sick leave. Governor Pritzker has announced he looks forward to signing the legislation. If he does, Illinois will join Maine and Nevada and become the third state to require paid leave for employers for “any” reason. If signed, the bill will take effect January 1, 2024, and will apply to all employers with at least one employee working in Illinois.

Here’s what Illinois employers need to know now.

Who is covered–and who is not

Under the Act, an employee who works in Illinois is entitled to earn and use up to a minimum of 40 hours of paid leave (or a pro rata number of hours) during a 12- month period.

The Act looks to the Illinois Wage Payment and Collection Act to define “employer” and “employee” (with some additions and carve-outs), but essentially applies to all employers with at least one employee in Illinois and employees in Illinois with some notable exceptions:

  • Independent contractors under Illinois law
  • Individuals who meet the definition of “employee” under the federal Railroad Unemployment Insurance Act or the Railway Labor Act
  • College or university students who work part time and on a temporary basis for the college at which they are enrolled
  • Individuals who work for an institution of higher learning for less than two consecutive calendar quarters and who do not have an expectation that they will be rehired by the same institution
  • Employees working in the construction industry covered by bona fide collective bargaining agreements (CBAs)
  • Employees covered by CBAs with an employer that provides services nationally and internationally of delivery, pickup and transportation of parcels, documents, and freight.

Also, the Act does not apply to any employer that is covered by a municipal or county ordinance in effect on the effective date of the Act that requires employers to give any form of paid leave to their employees, including paid sick leave or other paid leave. Thus, for instance, employers covered by the Chicago Paid Sick Leave Ordinance or Cook County Earned Sick Leave Ordinance won’t be required to provide paid leave under the Act.

When and how paid leave accrues under the Act

Paid leave accrues for employees at the rate of one hour of paid leave for every 40 hours worked, up to a minimum of 40 hours of paid leave per 12-month period (or a greater amount if the employer chooses to provide more than 40 hours of leave).

An employee would begin to earn paid leave on their first day of their employment (or the first day of the 12-month period, see below)–or on the effective date of the Act, whichever is later.

Employees who are exempt from the overtime requirements of the federal Fair Labor Standards Act (FLSA) will be deemed to work 40 hours in each workweek for purposes of paid leave accrual unless their regular workweek is less than 40 hours, in which case paid leave accrues on a pro-rata basis based on the employee’s regular workweek.

The “12-month period”

The 12-month period can be any consecutive 12-month period designated by the employer in writing at the time of the employee’s hire.

The employer can change the 12-month period if the employer gives notice to employees in writing prior to the change, and the change does not reduce the eligible accrual rate and paid leave available to the employee. If the employer changes the designated 12-month period, the employer must provide employees with documentation of the balance of their hours worked, paid leave accrued and taken, and their remaining paid leave balance.

Employees can start using paid leave after 90 days of employment (or the Act’s effective date)

Employees can begin using paid leave 90 days after the commencement of their employment or 90 days following the effective date of the Act, whichever is later-but employers can allow employees to use paid leave earlier.

Employees determine how much paid leave they need to use, but employers can set a reasonable minimum increment for the use of paid leave not to exceed 2 hours per day. If an employee’s scheduled workday is less than 2 hours a day, the employee’s scheduled workday will be used to determine the amount of paid leave.Continue Reading Illinois on Verge of Requiring Employers to Provide 40 Hours of Paid Leave for “Any Purpose”

Special thanks to Scott McMillen.

Looking Ahead: Exploring the Key Themes and Recommendations for US and Global Employers in 2023

Between maintaining business continuity and keeping your workforce safe, we know there’s been little time to track the rapidly changing employment, compensation and mobility law landscape — in Illinois, across the US, and globally.…