In the latest of a series of major legislative development affecting Illinois employers, Governor Pritzker signed Public Law 101-0221 on August 9, 2019, which includes the new Workplace Transparency Act (the “WTA”) and also makes changes to the Illinois Human Rights Act and various other current laws. The WTA is an outgrowth of the #metoo movement and is intended to prevent harassment in the workplace and ensure incidents of harassment and discrimination are not kept buried from public disclosure, as allegedly happened for many years in the Harvey Weinstein situation. Most provisions of Public Law 101—0221 go into effect on January 1, 2020. The new legislation will impact what sorts of agreements can be put in place with employees, prospective employees, and former employees, how disputes relating to harassment and discrimination can be resolved, the training that must be conducted by employers, and what information about judgments and settlements must be disclosed to the government.

Restrictions on Agreements with Employees, Prospective Employees, and Former Employees

The WTA prohibits “[a]ny agreement, clause, covenant or waiver that is a unilateral condition of employment or continued employment” and that:

• has the purpose or effect of “preventing an employee or prospective employee from making truthful statements or disclosures about alleged unlawful employment practices” or
• “requires the employee or prospective employee to waive, arbitrate, or otherwise diminish any existing or future claim, right, or benefit related to an unlawful employment practice to which the employee or prospective employee would otherwise be entitled under any provision of State or federal law….”

The WTA clearly is targeting, in the first place, confidentiality and non-disparagement provisions that are imposed unilaterally by an employer and that purport to bar an employee from disclosing unlawful employment practices and, in the second place, mandatory arbitration agreements, jury waivers, and similar terms imposed unilaterally by employers that make it more difficult for employees to vindicate their rights.

The attempt to restrict the use of arbitration agreements by employers may run afoul of federal law which contains an expressed policy in support of such agreements as stated in the Federal Arbitration Act. This potential conflict between State and federal law likely will be sorted out in future litigation.

Certain Mutual Employment Agreements Qualify for Different Treatment

The WTA sets up two exceptions to the general prohibitions described above. First, an employer is permitted to enter into an agreement that would otherwise violate the WTA if the agreement “is a mutual condition of employment,” is in writing, is supported by “actual, knowing, and bargained-for consideration from both parties,” and does not prevent an employee or prospective employee from: (1) reporting good faith allegations of unlawful employment practices to appropriate federal, State, or local agencies enforcing discrimination laws, (2) reporting good faith allegations of criminal conduct to appropriate federal, State, or local officials, (3) participating in a proceeding enforcing discrimination laws, (4) making any truthful statements or disclosures required by law, regulation, or legal process, or (5) requesting or receiving confidential legal advice.

Settlement and Termination Agreements Also are Treated Differently

The second exception under the WTA involves “valid and enforceable settlement or termination” agreements that include promises of confidentiality related to alleged unlawful employment practices. To qualify for the exception, the following criteria must be met:

1. “[C]onfidentiality is the documented preference of the employee, prospective employee, or former employee and is mutually beneficial to both parties”;
2. The employer must provide notice, in writing, of the employee, prospective employee, or former employee’s right to have an attorney review the agreement;
3. There must be valid, bargained for consideration “in exchange for the confidentiality”;
4. There must not be a waiver of claims that accrue after the date of the agreement;
5. The employee, prospective employee, or former employee must be given 21 days to review the agreement; and
6. “[U]nless knowingly and voluntarily waived,” the employee, prospective employee, or former employee must be given 7 days to revoke the agreement.

It is worth noting that the WTA makes clear that employers can still require individuals to keep allegations of unlawful conduct confidential if they receive complaints or investigate them as part of their job or if they are a participant in an investigation.

New Training Requirements

Also part of Public Law 101-0221, a new provision has been added to the Illinois Human Rights Act that will require employers to provide annual sexual harassment prevention training to employees. The Illinois Department of Human Rights has been directed to produce a model training program, and employers will be able either to use that model program or one of their own that equals or exceeds the minimum standards. Beyond describing the subjects that must be part of the program, the legislation gives few details about how long the training must be, whether it must be participatory, and whether it must be in-person. One helpful part of the legislation is that employers who do not comply with the training requirement will be given a thirty-day period after being cited during which they can provide the training.

Expansion of IDHR Coverage

Besides the new training provision described above, Public Law 101-0221 also expands the Illinois Human Rights Act by adding protection based on perceived membership in a protected class, adding a new definition of “harassment,” providing protection from harassment for nonemployees (i.e., contractors and consultants) who provide services to an employer, and making clear that an employer’s “work environment” is not limited to the physical location to which an employee is assigned. The legislation also makes clear that an employer will not be liable for the harassment carried out by non-managers and non-supervisory personnel unless the employer becomes aware of the conduct and fails to take reasonable corrective measures. This mirrors the treatment under federal law for non-managers and non-supervisory personnel.

New Reporting Requirements

Beginning in July of 2020, employers who have experienced an adverse judgment involving sexual harassment or workplace discrimination in the prior calendar year will be required to make certain reports to the Illinois Department of Human Rights. The Department of Human Rights also will have expanded powers to request settlement information as part of an investigation of a charge. Information shared with the Department of Human Rights will not be subject to Illinois’ FOIA law.

Expansion of VESSA

Finally, Public Law 101-0221 also amended Illinois Victims’ Economic Security and Safety Act (VESSA). This statute protects victims of sexual and domestic violence and certain family and household members from discrimination and gives them certain leave and accommodation rights. With the changes recently enacted, VESSA now also protects victims of gender violence, which is defined as “(A) one or more acts of violence or aggression satisfying the elements of any criminal offense under the laws of this State that are committed, at least in part, on the basis of a person’s actual or perceived sex or gender, regardless of whether the acts resulted in criminal charges, prosecution, or conviction; (B) a physical intrusion or physical invasion of a sexual nature under coercive conditions satisfying the elements of any criminal offense under the laws of this State, regardless of whether the intrusion or invasion resulted in criminal charges, prosecution, or conviction; or (C) a threat of an act described in item (A) or (B) causing a realistic apprehension that the originator of the threat will commit the act.”

What Should Illinois Employers Do Now?

Faced with the above provisions, Illinois employers likely will want to take several steps.

First, because it will be difficult to show that an agreement is “mutual” for purposes of the WTA, employers will want to assume that most agreements signed by employees as a standard condition of their employment are going to be “unilateral.” For these agreements, the safest route will be to carve out an employee’s right to make truthful statements or disclosures about unlawful employment practices and to remove any provisions that might diminish an employee’s right to pursue employment-related claims.

Second, for certain agreements with high-level executives that are truly the product of bargaining and for settlement and termination agreements, to the extent terms are included that otherwise would violate the WTA, employers will want to make sure that the agreements contain appropriate recitations demonstrating that one of the exceptions in the statute would be applicable.

Third, employers will want to make sure they revise their policies and handbooks to reflect the protection of nonemployees from harassment and the changes to VESSA.

Fourth, employers will want to begin planning to conduct annual anti-harassment and discrimination training.

To the extent you have more questions about the WTA and the other provisions of Public Law 101-0221, you should feel free to contact us.