Illinois's new employment law landscape
A series of bill signings by Illinois Governor J.B. Pritzker have enacted sweeping changes to the landscape of employment law in Illinois. In addition to expansions of the Illinois Human Rights Act (IHRA) and the Illinois Victims’ Economic Security and Safety Act (VESSA), the newly created Workplace Transparency Act (WTA) imposes important new reporting, training, and contracting requirements. Although most changes go into effect on January 1, 2020, amendments to the Illinois Equal Pay Act (IEPA), barring consideration of applicant salary history, become effective September 29, 2019.
Below is a summary of these important changes:
Illinois Equal Pay Act revisions
Illinois has joined a number of other states in updating its Equal Pay Act (IEPA) to restrict employers from soliciting salary history information from applicants. The amendment’s stated primary aim is to eradicate the prevalent wage gap between men and women in the workforce. The following changes will go into effect on September 29, 2019:
- Employers are prohibited from requesting or requiring applicants to disclose prior wage, salary, benefit or other compensation history as a condition of an application process or employment.
- Employers may not refuse to hire an applicant or take adverse action against an employee for refusing to provide information regarding their salary history.
- Employers may ask an applicant for his or her expectations with respect to wages and benefits.
- Even if an applicant voluntarily discloses his or her past compensation, an employer may not use that information in deciding whether to hire the applicant or in determining the applicant’s salary.
- Employers cannot instruct employees to refrain from discussing their wages, salary, benefits or other compensation with others. However, employers may continue to prohibit human resources employees, supervisors, and other employees with access to wage or salary information from disclosing that information without the written consent of the employee whose information is sought or requested.
- In litigation, employees seeking to demonstrate discriminatory pay disparity now have a lower burden of proof. Previously, employees were limited to comparing themselves to employees working in jobs requiring equal skill, effort and responsibility. Per the amendment, employees may compare themselves to employees working in jobs requiring substantially similar skill, effort and responsibility.
- Successful applicants and employees may recover injunctive relief and damages under the Act, including actual damages incurred, special damages of up to $10,000, punitive and compensatory damages, and costs and reasonable attorneys’ fees.
Artificial Intelligence Video Interview Act
Illinois’s new Artificial Intelligence Video Interview Act restricts employers’ ability to use artificial intelligence (AI) in analyzing job applicants. Beginning January 1, 2020, any employer that asks applicants for positions based in Illinois to record video interviews and uses an artificial intelligence analysis of the applicant-submitted videos must:
- Notify the applicant before the interview that AI may be used to analyze the applicant.
- Provide the applicant with information before the interview explaining how the AI works and what characteristics it uses to evaluate applicants.
- Obtain consent from the applicant before any interview using AI.
- Share the video only with persons whose expertise or technology is necessary to evaluate the applicant.
- Destroy the video and any copies within 30 days of a request to do so by the applicant.
Workplace Transparency Act
The WTA imposes a variety of restrictions and obligations on employers relating to workplace discrimination and harassment that will create significant changes to the employment landscape in 2020.
Restriction of confidentiality, non-disclosure, and non-disparagement clauses
The WTA generally forbids employers from preventing employees or applicants from making truthful statements or disclosures about alleged criminal activity or unlawful employment practices. The WTA defines “unlawful employment practice” as “any form of unlawful discrimination, harassment, or retaliation” that is actionable under state or federal law. Such prohibitions may be included if:
- The provision is in writing.
- It demonstrates actual, knowing, and bargained-for consideration from both parties.
- It acknowledges certain fundamental employee rights, including those to:
- Report good faith allegations of unlawful discrimination or harassment to an appropriate agency.
- Report good faith allegations of criminal conduct to an appropriate government official.
- Participate in a proceeding with an appropriate federal, state, or local government agency.
- Make truthful statements or disclosures required by law, regulation, or legal process.
- Request or receive confidential legal advice.
The law also prohibits employers from requiring employees or prospective employees to waive, arbitrate, or otherwise diminish any existing or future claim or right related to an unlawful employment practice. This means that any mandatory arbitration clause covering employment claims must satisfy the requirements listed above.
Relatedly, the new law bars non-disclosure and/or non-disparagement clauses in settlement or termination agreements, unless:
- Confidentiality is the documented preference of both parties.
- Confidentiality is beneficial to both parties.
- The employee is notified of his or her right to have an attorney review the agreement.
- The employee is given 21 days to consider the agreement and a seven-day revocation period.
- The waiver is knowing and voluntary.
- There is valid, bargained-for consideration in exchange for the confidentiality.
- The agreement does not require the employee to waive claims of unlawful employment practices that accrue after the date of execution of the settlement or termination agreement.
Importantly, the WTA does not apply to collective bargaining agreements, which govern in the event of a conflict with the Act.
Mandatory sexual harassment training
Similar to California and New York, beginning January 1, 2020, every employer “with employees working in” Illinois must provide sexual harassment prevention training at least once a year. At a minimum, the training must:
- Explain what sexual harassment is (consistent with the IHRA’s definition).
- Provide examples of prohibited conduct.
- Summarize federal and state sexual harassment laws, including remedies available to victims.
- Summarize the employer’s responsibility to prevent, investigate, and correct sexual harassment.
Unfortunately, the new law does not specify exactly who must receive the training. By merely stating “every employer with employees working in this State” must provide the training, it is unclear whether employers are only required to provide the training to Illinois employees, or to all employees regardless of location as long as the employer has at least one employee “working in” Illinois.
The Illinois Department of Human Rights (IDHR) has indicated that it will create a model training program for employers to use, but has not committed to a date by which that training will be available. Employers may also use their own program, so long as it complies with the above requirements. At this time, in-person training is not explicitly required.
Failure to comply with the training requirements may subject employers to civil penalties of up to $5,000 per offense.
Expansion of the Illinois Human Rights Act
Effective January 1, 2020, the IHRA will become increasingly employee friendly.
- Harassment and discrimination based on “perceived” protected characteristics will be expressly prohibited. Currently, only causes of action for “perceived” harassment or discrimination based on disability are viable. Beginning in January, employees may pursue claims alleging they were subjected to unwelcome conduct or discriminated against based on any protected characteristic their employer “perceived” them to have, regardless of whether the individual actually has that characteristic. The following characteristics are protected under the IHRA: race, color, religion, national origin, ancestry, age, sex, marital status, pregnancy, protective order status, disability, military status, unfavorable discharge from military service, and sexual orientation. As an example, if an employer “perceives” an employee to be 40 years old or older and discriminates on that basis, it can still be liable for discrimination even if the employee is younger than 40.
- “Nonemployees” such as contractors and consultants will be protected from harassment under the IHRA. Employers will be subject to liability for harassing conduct that substantially interferes with nonemployees’ work performance or which creates an intimidating, hostile or offensive working environment for non-employees as members of a protected class. The nonemployees must directly perform services for the employer pursuant to a contract, such as independent contractors or consultants. If the allegations are brought against non-managerial and non-supervisory staff, then employers will be liable for such harassment only if the employer has actual knowledge of the conduct and fails to take reasonable corrective measures.
- Expansion of “working environment.” The WTA clarifies that, for the purposes of the IHRA, the definition of “working environment” is not limited to physical locations where an employee is assigned to perform work. This clarification is likely a reflection of the increase in the number of employees working remotely, and therefore requires employers to ensure that employees are not subjected to an intimidating, hostile, or offensive environment regardless of where their work actually takes place. The amendment does not address any distinction between “working time” and “off hours.”
Bars and restaurants
Interestingly, the WTA sets additional requirements for Illinois bars and restaurants. Under the Act, “restaurant” includes (but is not limited to) coffee shops, cafeterias, and catering facilities – essentially any establishment in the business of serving food or drink.
These employers must provide supplemental training in English and Spanish specifically aimed at the prevention of sexual harassment in the restaurant and bar industry. As with the general training program, the IDHR has stated that it will provide a model program, but it is unclear when this will occur.
Illinois bars and restaurants must also provide employees with a written sexual harassment policy in English and Spanish within the first calendar week of employment. The policy must include:
- A prohibition on sexual harassment.
- The definition of sexual harassment under state and federal law.
- Details on how an individual can report an allegation of sexual harassment internally, including options for making a confidential report to a manager, owner, corporate headquarters, human resources department, or other internal reporting mechanism that may be available.
- An explanation of the internal complaint process available to employees.
- How to contact and file a charge with the IDHR and United States Equal Employment Opportunity Commission (EEOC).
- A prohibition on retaliation for reporting sexual harassment allegations.
- A requirement that all employees participate in sexual harassment prevention training.
Hotels and casinos
Employers who operate hotels or casinos must provide a device to employees who work in guest rooms, restrooms, or on a casino floor “under circumstances where no other employee is present in the room or area” for the purpose of summoning help if the employee reasonably believes there is an ongoing crime, sexual harassment, assault or other emergency. In addition, hotels and casinos must implement written anti-sexual harassment policies that “protect employees against sexual assault and sexual harassment by guests.” Hotels and casinos will also be subject to the sexual harassment training requirements outlined above.
The Illinois Victims’ Economic Security and Safety Act (VESSA) currently requires employers to provide 8–12 weeks of unpaid, job-protected leave (or other reasonable accommodations) in order for employees to seek medical, psychological, or other services after suffering domestic violence, sexual violence, or stalking. The WTA amends VESSA to include gender violence as a qualifying reason for taking leave under VESSA.
The WTA defines “gender violence” as “one or more acts of violence or aggression [or a threat of such violence] 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.” While not a drastic departure from the domestic and sexual violence already covered by VESSA, employers should note the expanded scope: now, an employee who suffers or is threatened with violence based on his or her gender is entitled to leave under VESSA. Employees who present a VESSA-qualifying reason for leave may elect to substitute other available paid or unpaid leave, but employers cannot require that they do so.
Mandatory annual reporting
Beginning July 1, 2020, employers must disclose the following information annually to the IDHR:
- The total number of adverse judgments or administrative rulings during the prior year against the employer in any discrimination case under any federal, state, or local law (if more than zero).
- Whether any equitable relief was ordered against the employer in any such judgment or ruling.
- The total number of such judgments and rulings, broken down by the protected characteristic(s) on which the allegations were based.
An earlier version of the Bill also required employers to report similar information about settlements. In a reprieve for employers, the final version merely provides that employers may be required to disclose information on settlements of any harassment or discrimination claims, but only if the IDHR is investigating a charge filed under the IHRA and requests such information.
Neither the judgment nor settlement disclosures will be subject to a FOIA request, meaning the information should remain unavailable to the general public. However, the IDHR may use the information to open a preliminary investigation into “pattern and practice” violations for employers with repeat adverse findings. While the new law states that the IDHR shall not rely on the existence of any settlement agreement to support a finding of substantial evidence of discrimination, there is no similar language to prevent the IDHR from relying on prior adverse judgments or rulings in deciding whether there is substantial evidence of discrimination.
Employers that fail to comply with these reporting obligations could incur civil penalties up to $5,000 per offense.
- Remove any wage or salary enquiries from job applications and train employees who participate in interviewing or hiring decisions to refrain from making any prohibited salary enquiries. Ensure any third-party vendors used in the recruitment and hiring process act in compliance as well. If an applicant discloses his or her salary history, do not use this information to make salary decisions. Recruiters need to be very careful when making notes on “salary expectations” versus “salary history.”
- Review existing policies and agreements that include confidentiality provisions to ensure that all references to confidentiality of salary information are removed, except with respect to human resources and other professionals excepted from the new requirements.
- Ensure that the use of artificial intelligence in hiring complies with Illinois law.
- Review all current and future employment agreements to ensure that they comply with the restrictions on confidentiality and do not prohibit employees from disclosing certain conduct.
- Develop sexual harassment prevention training compliant with Illinois law, paying close attention to the extra requirements placed on restaurants, bars, hotels and casinos.
- Train managers, supervisors, and human resources staff regarding the new scope of the provisions of the IHRA and VESSA.
- Establish a system to track adverse judgments, administrative decisions, and settlements in preparation for mandatory reporting to the IDHR.
- Stay tuned for further guidance from Illinois agencies regarding interpretation and implementation of these new requirements.