Governor Acts on Key Employment Law Legislation
The General Assembly completed most of its unfinished business when it returned to Springfield on June 15 & 16. An energy bill still looms without an agreement. The issue may bring lawmakers back before Veto Session. The Veto Session has been set for October 19, 20, 21, 26, 27 & 28.
All measures from the regular spring session have been sent to the Governor. The Governor has up to 60 days from receipt of a piece of legislation to act upon it.
Cleanup of Equal Pay Certificate Registration Requirements: SB 1847, sponsored by Sen. Mattie Hunter (D-Chicago) and Rep. Sonya Harper (D-Chicago) was signed into law and was effective June 25th as PA 102-36. The new law applies to employers of 100 or more Illinois employees and requires certain wage and benefit data similar to what is required to be filed with the EEOC to be filed with the Illinois Department of Labor. Several key features in the trailer bill include replacing the 1% gross profit penalty, delaying implementation until January 1, 2022, allowing employers in certain cases to cure an otherwise violation and privacy protection for individual and business data filed with the Department. We are working with IDOL in their implementing the new provisions. For a summary of PA 102-36 contact Jay Shattuck.
EXTREME Penalty Increase for Wage Payment & Collection Act Violations: HB 118, sponsored by Rep. Will Guzzardi (D-Chicago) and Sen. Karina Villa (D-West Chicago), increases the monthly penalty interest from 2% to 5% for violations for wage underpayments. It is now PA 102-50 and is effective July 9, 2021.
Other Employment Issues Acted Upon:
Video Interviews: HB 53, sponsored by Rep. Jaime Andrade (D-Chicago) and Sen. John Connor (D-Joliet), amends the Artificial Intelligence Video Interview Act to require employers that rely solely upon artificial intelligence to determine whether an applicant will qualify for an in-person interview to gather and report certain demographic information to the Department of Commerce and Economic Opportunity. DCEO must analyze the data and report to the Governor and General Assembly whether the data discloses a racial bias in the use of artificial intelligence. Signed into law as PA 102-47 with an effective date of January 1, 2022.
Unemployment Insurance: HB 2643, sponsored by Rep. Jay Hoffman (D-Belleville) and Sen. Linda Holmes (D-Aurora), amends the Identity Protection Act to allow social security numbers to be included in applications and forms sent by mail, including, but not limited to, any material mailed in connection with the administration of the Unemployment Insurance Act pursuant to the limitations and requirements of that Act. Amends the Department of Employment Security Law preventing the Department of Employment Security from disclosing an individual's entire social security number in any correspondence physically mailed to an individual or entity. Requires the Department to develop a system of identifying information to be used instead of social security numbers. Amends the Unemployment Insurance Act authorizing benefits for certain academic personnel. Requires notice of his or her appeal rights when an individual has received benefits and been found to be ineligible for those benefits. Limits recovery of benefits from persons who are ineligible if the receipt of benefits was without fault of the individual. Provides that, with the written consent of a claimant or employing unit and an agreement not to publicly disclose, the Director shall provide requested information related to a claim to a public officer or his or her agent. These changes are effective
As part of the budget bill, $100 million of American Rescue Plan Act allocation to Illinois is being used to pay for the benefit expansions of PA 102-26. However, clarification language to hold employers harmless for the benefit expansions will be needed approved during the October Veto session.
Wage Withholding for Health Insurance: SB 258, sponsored by Sen. Mike Hastings (D-Mokena) and Rep. Kelly Burke (D-Chicago), amends a Section of the Illinois Marriage and Dissolution of Marriage Act regarding health insurance coverage for children. Defines "insurance obligee" as an individual to whom a health insurance obligation is owed on behalf of a child and "insurance obligor" as an individual who has an obligation to provide health insurance for a child. Deletes language providing that the court shall enter an order for health insurance coverage of the child upon the request of the obligee or the public office in charge of child support enforcement. Deletes certain requirements concerning the procedures and notice obligations governing an application for insurability following the entry of an order. Deletes language providing that the court shall order the obligor to reimburse the obligee for 50% of the premium for placing the child on his or her health insurance policy under certain circumstances. Deletes language providing that the court may order the obligor to reimburse the obligee for 100% of the premium for placing the child on his or her health insurance policy. Deletes language providing that the obligor shall be liable to the obligee for the dollar amount of the premiums that were not paid. Provides that an employer may eliminate a child from the insurance obligor's health insurance coverage if the employer no longer provides a group health insurance plan to any employees or the child is no longer eligible for coverage due to federal or State restrictions. Makes other changes. Now PA 102-87 effective January 1, 2022.
Workers’ Compensation Fraud: SB 1993, sponsored by Sen. Tony Munoz (D-Chicago) and Rep. Bob Morgan (D-Highland), transfers the Insurance Compliance Division of the Illinois Workers’ Compensation Commission to the Illinois Department of Insurance. Now PA 102-37 it is effective July 1, 2021.
Council Testifies at IDOL Hearing on Joint Employer Rule
Executive Director Jay Shattuck testified before the Illinois Department of Labor on its proposed rule regarding Joint Employer status. In 2020, IDOL filed a similar proposed rule but failed to adopt it in the required timeframe under the Illinois Administrative Procedure Act.
Shattuck pointed out that the rule would potentially harm Illinois competitiveness and recommended that the Department await the result of the fate of the USDOL rule adopted during the Trump Administration before proceeding with its proposal.
He was joined in his testimony by Michael Hughes from SmithAmundsen. Hughes pointed out that the proposed rule changes lower the standards for a finding of a joint employer relationship. He also indicated that the Department’s examples used to better explain the rule were inadequate.
For a copy of the Council’s written comments to IDOL, contact Jay Shattuck.
Other Employment Legislation Awaiting Gubernatorial Action
HB 117: SECURE CHOICE SAVINGS PROGRAM (Rep. Guzzardi D-Chicago/Sen. Martwick D-Chicago) As amended, the Act will apply to employers with at least 5 employees, rather than at least one employee. (Current law applies to employers with more than 25 employees.) Newly covered employers will be done in two waves – employers with 16 to 24 employees will have a deadline to comply of no sooner than September 1, 2022 and employers with 5-15 employees will have a deadline to comply of no sooner than September 1, 2023. Small employers may, but are not required to, establish payroll deduction arrangements for retirement savings arrangements. Modifies the enforcement process so that employers have an additional chance to come into compliance after receiving the notice of proposed assessment from the Department of Revenue – they will be given 120 days to come into compliance and if they do, any penalty fees assessed will be waived. Chamber Neutral
HB 3582: EXPANSION OF VESSA (Rep. Robyn Gabel D-Evanston/Sen. Robert Peters D-Chicago)
Expands the Victims' Economic Security and Safety Act (VESSA) covering: 1) victims and family members of victims of crimes of violence (in addition to victims of domestic violence, sexual violence, and gender violence) and 2) any individual whose close association with the employee is the equivalent of a family relationship. An amendment eliminating a civil action option was agreed to by the Council. With removal of the civil action the Chamber is Neutral.
SB 1905: HEALTH INSURANCE BENEFIT DISCLOSURE REQUIREMENTS (Sen. Julie Morrison D-Highwood/ Rep. Margaret Croke D-Chicago) House amendment 1 to SB 1905 creates the Consumer Coverage Disclosure Act to require employers to disclose to employees the differences under the employees' health coverage and health coverage providing essential benefits under health plans regulated by the State of Illinois. Directs the Department of Insurance to provide information outlining the essential benefits and other benefits under coverage regulated under State law. Provides for enforcement by the Department of Labor. Authorize the imposition of civil penalties, if after notice of noncompliance, an employer does not come into compliance within 30 days. Chamber Neutral
SB 2486: PERSONNEL RECORDS STATUTE OF LIMITATIONS (Sen. Villivalam D-Chicago/Rep. Evans D-Chicago) Amends the Personnel Record Review Act allowing an individual to file a complaint with the Director of Labor or commence an action alleging a violation within 3 years after the date of the disclosure of a disciplinary action. Chamber Neutral
Employment Discrimination and Workplace Agreements
SB 672: NON-COMPETE/NON-SOLICIT AGREEMENTS (Sen. Hunter D-Chicago/Rep. Burke D-Chicago) For a complete summary of SB 672, contact Jay Shattuck. Since February of 2020, The Illinois Chamber Employment Law Council has been in negotiations with the National Employment Lawyers Association (NELA) on changes to the Illinois Freedom to Work Act. The proposal generally makes reasonable limitations on covenants not to compete and covenants not to solicit and provides employers greater clarity and certainty as to whether their covenant not to compete or covenant not to solicit will meet judicial scrutiny. If approved by the Governor, the changes will go into effect January 1, 2022 and applies to covenants not to compete and covenants not to solicit entered into after the effective date. Chamber SUPPORT
HB 121: HUMAN RIGHTS-WORK AUTHORIZATION (Rep. Guzzardi/Se. Ram Villivalam D-Chicago) HB 121 provides that it is the public policy of the State to prevent discrimination based on the specific status or term of status that accompanies a legal work authorization. It defines "work authorization status" as the status of being a person born outside of the United States, and not a U.S. citizen, who is authorized by the federal government to work in the United States. A Council requested amendment that has been added clarifies that an employer is not required to sponsor, either monetarily or otherwise, any applicant or employee to obtain or modify work authorization status, unless otherwise required by federal law. Chamber SUPPORT
HB 1207: EQUAL PAY/DEFERRED COMPENSATION (Rep. Moeller D-Elgin/Sen. Castro D-Elgin) Affirmatively provides that an employer may request an applicant to verify the aggregate amount of unvested equity or deferred compensation the applicant would forgo by resigning the applicant's current position. Chamber Neutral
HB 1838: DEFINITION OF DISABILITY (Rep. Mah D-Chicago/Sen. Villivalam) Adds to the Illinois Human Rights Act that discrimination based on disability includes unlawful discrimination against an individual because of the individual's association with a person with a disability. Chamber Neutral
State Budget Update
When the General Assembly returned in mid-June, it needed to accept an amendatory veto of the operating budget, SB 2800. The AV recommended replacing the effective date provisions of the bill, which did not specify effective dates for certain appropriations, with provisions giving supplemental appropriations an immediate effective date and FY22 appropriations a July 1, 2021 effective date. With the acceptance of the AV, the bill became PA 102-17.
IWCC salary increases: The budget implementation measure (BIMP), SB 2017, was signed as PA 102-16. One change in the BIMP bill was the salary increases for the appointed positions at the Illinois Workers’ Compensation Commission. The Workers’ Compensation Act now provides that each Commissioner shall receive an annual salary of 70% of a Circuit Court Judge in the Judicial Court constituted by the First Judicial District under the Salaries Act and the Chairman shall receive an annual salary of 5% more than the other Commissioners. The Secretary of the Commission and each arbitrator shall receive a per annum salary of 5% less than the per annum salary of members of the Illinois Workers' Compensation Commission.
Redistricting Update
Gov. Pritzker has signed the legislative and supreme court judicial redistricting maps. As expected, the Illinois legislative Republicans immediately filed litigation. In addition, the Mexican American Legal Defense & Education Fund also filed litigation on the legislative map.
Congressional maps were not considered due to the lack of census data and likely will be dealt with during the Veto Session.
Lawmakers also approved moving the Illinois primary elections to June 28, 2022.
