Category Archives: State Law Trends – Illinois

Wisconsin becomes the latest “right-to-work” state

wisconsin-webOn March 9th, Wisconsin passed right-to-work legislation banning collective bargaining agreements that require private-sector workers to pay labor fees. The law, which makes Wisconsin the 25th state to pass such legislation, becomes effective immediately.

The legislation bans “union security clauses” — clauses that provide for the termination of an employee who fails to join and pay labor fees to the union — from being included in collective bargaining agreements.

Although this type of legislation started in the southern and western states, in recent years, Indiana and Michigan, traditionally union-friendly states, passed similar right-to-work laws. This type of legislation has proven to reduce state-wide union membership.

It seems unlikely that Illinois will implement right to work legislation in the private sector (at least with the current makeup of the legislature), but it is definitely on the forefront in the public sector.  Last month, Illinois governor, Bruce Rauner, announced a controversial executive order that would prohibit unions from requiring state workers to pay union fees.

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2015 Check-In – Have you updated your policies and documents?

Echeckarlier this year, we posted a checklist outlining key issues and action items for compliance in 2015. With the first quarter coming to a close, we want to remind you of a few important items from that checklist that required changes to your policies and practices, as well as alert you to a new item that requires immediate action.

Change FMLA policy to reflect same-sex spouses.

Effective March 27, 2015, the definition of “spouse” under the FMLA will be amended so that an eligible employee in a legal same-sex marriage will be allowed to take FMLA leave for his or her spouse. Make sure that you change your FMLA policies and practices to reflect this new definition.

Confirm employment applications and processes comply with “Ban the Box.”

As of the first of this year, Illinois employers must wait until an interview has been granted (or, if no interview, until a conditional offer of employment has been made) before asking about criminal history. New Jersey’s new law, effective earlier this month, requires companies to wait even longer. Employers hiring in these states — as well as in other states with similar laws — should ensure that employment applications do not contain criminal background questions and that questions regarding criminal background are not asked until it’s legal to do so.

Comply with new Illinois pregnancy accommodation rules and notice requirements.

As of January 1st, Employers in Illinois are required to provide reasonable accommodations to pregnant employees and applicants who ask for them, to post a notice in the workplace regarding pregnancy accommodation rights, and to include language relating to such rights in their handbooks. Make sure your team is aware of these requirements and that any necessary changes to policies and practices have been made.

Illinois Enacts Secure Choice Savings Program

Illinois Secure Choice Savings ProgramOn January 4, 2015, outgoing Illinois Governor Patrick Quinn signed The Illinois Secure Choice Savings Program Act, requiring any business in operation for at least two years that has 25 employees or more in Illinois, and that does not have a qualified retirement plan, to offer its employees an individual retirement savings plan by June 1, 2017.

Covered employers will be required to enroll employees into a newly created, state-sponsored Roth IRA program that comes with a default 3% payroll deduction contribution. Employers will not be required to contribute. Employees will be able to choose a different contribution amount or opt out of the program entirely, though supporters say they expect most employees who currently have no retirement savings option at work will choose to participate.

None of this will happen immediately. The Act contains only an outline of the program and provides for a board to be appointed that will design the final program during a planned 24-month startup period. But before the board can take significant action, it must obtain start-up funding for the program, through future state appropriations or donations. Once the board obtains funding and designs the program, employers will have nine more months to enroll employees before facing penalties.

We will keep you informed once solid information and directives are available.

The Courts Continue to Debate Restrictive Covenant Enforcement in Illinois – UPDATED 2/20

From time to time, other attorneys with our firm will contribute blog posts on items that may be of interest to members of the labor and employment law community. Today, we are fortunate to have a post contributed by Jason Hirsh, a partner in Levenfeld Pearlstein’s Litigation Group. Jason’s post discusses current Illinois cases at the forefront of labor and employment law that frequently come up when employers draft, or seek to enforce, restrictive covenants in their employment agreements in this changing legal climate . . .

employent contract

Courts in Illinois are in the midst of a significant legal debate relative to whether a post-employment restrictive covenant involving an at-will employee can be enforced if the employee has less than two years of continued employment. This two-year bright line rule first blossomed in the often cited Fifield v. Premier Dealer Servs., Inc., 373 Ill.Dec.379 (1st Dist. 2013) decision. The debate continues to play out in the Chicago federal court.

In Montel Aetnastak, Inc. v. Miessen, 998 F.Supp.2d 694, 716 (N.D. Ill. 2014), Judge Castillo refused to apply the two-year bright line rule presumably adopted in Fifield. Judge Holderman, on the other hand, in Instant Technology, LLC v. Defazio, 12 C 491, __ F.Supp.2d __, 2014 WL 1759184 at *14 (N.D. Ill. 2014), took a contrary view.

On February 6, 2015, in Bankers Life and Casualty Company v. Richard Miller, et al., Case No. 14 CV 3165, Judge Shah waded into this controversy and rejected the two-year bright line rule. Instead, Judge Shah concluded that not only has “the Illinois Supreme Court not spoken on this issue”, but that case law does not support the argument that two years of employment is “necessary” to support a restrictive covenant.

This is a critically important issue affecting employers. Given the obvious uncertainty in the area of restrictive covenant enforcement, we recommend other forms of consideration, such as bonus payments, be considered.

Read the Bankers Life and Casualty Company v. Richard Miller, et al., Case No. 14 CV 3165 decision.

UPDATE (2/20/15) 
On the heels of Bankers Life, on February 13, 2015, in Cumulus Radio Corp. v. Olson, et al., Case No. 15-cv-1067 (C.D. Ill.2015), Judge McDade of the federal court in Peoria, Illinois granted an employer’s motion for a temporary restraining order stating “the Court does not believe that the Illinois Supreme Court would adopt the bright-line test announced in Fifield.”  Judge McDade added that the two-year bright line rule “suffers from a number of analytical problems that make it unsatisfying.”  Judge McDade also stated it also suffers from a “failure to give weight to the reason that an employee’s at-will employment ended.”  Favoring a case-by-case analysis, akin to that suggested by Bankers Life, Judge McDade further criticized the two-year bright line rule stating “[s]uch a rule is overprotective of employees, and risks making post-employment restrictive covenants illusory for employers subject completely to the whimsy of the employee as to the length of his employment.”

 

Amendments to Illinois Eavesdropping Statute Signed Into Law

IMG_1128On December 30, 2014, former Illinois Governor Pat Quinn signed into law a revised version of an eavesdropping statute that the Illinois Supreme Court had struck down as unconstitutionally overbroad last March. Under the revised law, it is a criminal act to record a private conversation or to intercept, record, or transcribe a private electronic communication without the consent of all parties to the communication. The law defines private as any oral or written communication between two or more people in which the parties have a “reasonable expectation” that the communication will remain private. Previously, recording anyone in Illinois (even in public) was illegal without permission.

Employers should implement policies prohibiting nonconsensual recording of private workplace conversations and beware of taping interviews, telephone conversations, investigatory interviews, disciplinary meetings, or any workplace conversations—even for legitimate business reasons—if consent of all parties is not obtained or there is an argument that the communications being made are private. Employers are encouraged to work with legal counsel to ensure their policies and practices do not conflict with National Labor Relations Board rules by restricting employees’ right to record non-private conversations in the workplace. Also, employer policies relating to employee use of company email systems need to ensure that employees do not have a “reasonable expectation” in the privacy of personal communications sent over those systems.

Reminder – Immediate Action Required Under New Illinois Pregnancy Rights Provisions

IDHR_Logo_2On January 1, 2015, Illinois Human Rights Act amendments providing additional rights to pregnant employees will take effect. (See our previous post for more in-depth information)

As previously mentioned, the law will require some immediate steps by employers.  Employers must post a government-provided notice where other mandated posters are displayed, (download here in English and Spanish), and update employee handbooks with a summary of pregnant employees’ new rights.

The Duel over Dual Minimum Wage Rates Heats up in Illinois

money-flowerIllinois might be headed toward two minimum wages—one for the City of Chicago and another for the rest of the state. Today, the Chicago City Council unanimously voted to increase Chicago’s minimum wage from $8.25 to $13.00 an hour by 2019. The Council’s vote was over the objection of both local businesses on the one hand, and labor advocates and political opponents on the other, who said the increase was not high or fast enough.

The move is not unique. Seattle made headlines in June when it voted to raise its minimum wage to $15.00 an hour, the highest in the country, in what seems to be turning into a national trend toward significant minimum wage hikes at the local level.

In Springfield, business interests are pressing state lawmakers to prevent Chicago from having a higher minimum wage than the rest of the state. At the same time, supporters of a plan to increase the statewide minimum wage to $10.00 an hour pushed for more votes in the Illinois House during their final 2014 session.

It remains to be seen if there are enough votes in Springfield, either to limit Chicago’s minimum wage increase, or to push for a similar statewide increase. In the meantime, employers in Illinois with employees in Chicago and in other parts of the state will need to adjust to the different wage levels.