When the Illinois General Assembly adjourned the 2013 Spring Session on May 31st, it set the stage for substantial changes to Illinois employment law. The General Assembly sent six employment law related bills to Governor Pat Quinn while leaving one major piece of unfinished business on its agenda. Illinois employers should be aware that these potential changes to the law could create exposure to new liability and the status of these bills should be closely monitored.
Social Media Privacy
Two bills that generated a great deal of attention in Springfield during the past legislative session dealt with issues related to social media privacy. In 2012, the General Assembly passed an amendment to the Right to Privacy in the Workplace Act prohibiting employers from requiring employees or applicants to disclose usernames and passwords for social media accounts. Senate Bill 2306, which passed both chambers, provides an exception to this law by allowing employers access when the account information relates to a professional account and the employer has a duty, such as under insurance or securities laws, to screen employees or applicants. The professional account must be used by the employee for business purposes. Notably, in order to be considered a “personal account” under the legislation, a social media account must be used exclusively for personal communications unrelated to any business purposes of the employer. Governor Quinn will have until August 19, 2013, to approve this bill.
The second social media related bill, House Bill 1047, passed the Illinois House of Representatives but has not yet been considered by the Illinois Senate. House Bill 1047 creates a much broader exception to the prohibition on requesting employee social media passwords. The bill would allow employers to require an employee to disclose any user name and password for any account or services provided by the employer that is used for business purposes. However, employers could not discharge or discipline (or refuse to hire) an employee who refuses to disclose the information. The bill passed the House by a vote of 69-35-2, but has not been considered by the Senate.
Outside of the realm of social media, a number of other significant bills were passed that could potentially impact Illinois employers. House Bill 2649 amends the Employee Classification Act. This Act was initially passed in 2008 to prevent the practice of misclassifying construction industry employees as independent contractors. The Act broadly covers the construction industry and imposes significant penalties for violators. House Bill 2649 represents a significant change to the Act because it exposes individuals who are engaged in construction activities and corporate officers of construction employers to personal liability for knowing violations of the Act. This bill gives employers 28 calendar days to respond to the Illinois Department of Labor's (IDOL) findings of a violation of the Act. Failure to respond will render the allegations admitted as true. While the bill does not expand the basis for potential liability, the potential imposition of personal liability on individual employers and corporate officers represents a landmark change for complaints filed under the Act. The bill narrowly passed the Illinois House of Representatives by a vote of 66-45-1 and the Illinois Senate by a vote of 34-20-1. The Governor has signed this bill and it will become effective on January 1, 2014.
Two other bills that passed the General Assembly affect prevailing wage laws. The first, House Bill 3223, imposes new record keeping requirements on certain employers while the second, House Bill 2540, eliminates certain employer filings. House Bill 3223 would amend the Prevailing Wage Act to require public works contractors to record each worker's gross and net pay, each worker's starting and ending times of each work day, each worker's hourly wage rate, each worker's hourly overtime rate, and each worker's hourly fringe benefit rate, among other required records and retain these records for at least three years from the date of the last payment on a contract. Public works employers will also need to file, no later than the 15th day of each calendar month, a certified payroll for the preceding month with the public body in charge of the project containing a complete copy of the records. Violations of the Act are punishable as a Class A misdemeanor. House Bill 3223 passed the House of Representatives by a vote of 68-38-1 and the Senate by a vote of 35-19. Governor Quinn will have until August 19, 2013, to approve the bill. If he does so, the bill will become law on January 1, 2014.
House Bill 2540 eases a filing requirement on public-works contractors by eliminating a requirement in the Prevailing Wage Act that prevailing wage reports be filed with the Secretary of State in addition to the IDOL. Under this bill, employers will only be required to file the reports with IDOL. Governor Quinn signed this legislation on August 5, 2013 and the law will become effective on January 1, 2014.
Beyond these bills dealing with required IDOL filings, the General Assembly also expanded IDOL’s administrative jurisdiction over claims arising under the Wage Payment and Collection Act. Senate Bill 1568 increases administrative fees owed by an employer upon a finding of wages due. Currently, IDOL may administratively adjudicate claims under $3,000. Senate Bill 1568 eliminates this threshold; the bill will permit administrative adjudication of a claim in any amount. The bill also increases the current administrative fee of $250 to $500 for claims in excess of $3,000 and $1,000 to claims in excess of $10,000. The fee for claims of under $500 will remain at $250. This bill passed both chambers of the General Assembly unanimously; Governor Quinn will have until August 24, 2013, to approve this bill. If he does so, it is possible that employers will see a surge in administrative filings, despite the increased filing fee, rather than cases filed in circuit court. While defending claims in administrative hearings can be less expensive, employers will also be confronted by less stringent evidentiary requirements and fewer discovery rules.
Employers should also be mindful of changes to payments required by the Illinois Department of Employment Security (IDES). House Bill 3125 authorizes IDES to promulgate regulations mandating electronic payment of unemployment contributions, payments, penalties, or interest. This bill also increases penalties for employers who violate certain provisions of the Unemployment Insurance Act. A willful filing of a fraudulent quarterly wage report will be a Class 4 felony if the amount owed is under $300 and a Class 3 felony if over $300. Currently, the penalty is a Class B misdemeanor. This bill, which was negotiated by labor and business community representatives, was approved by Governor Quinn on July 23, 2013. The bill became effective immediately upon his approval.
Finally, one bill passed by the legislature provides employers new tools to address the threat of workplace violence. House Bill 2590 establishes the Workplace Violence Prevention Act. This bill will allow employers to obtain an order of protection to prohibit further violence or threats if an employee has suffered unlawful violence or the threat of violence and the act (or threatened act) can reasonably be construed to be carried out at the employee’s place of work. For an employer to obtain an order of protection, the employer must file an affidavit that shows reasonable proof of unlawful violence or the threat of unlawful violence and that great or irreparable harm has been, will be, or is likely to be suffered. If the bill is approved by the Governor, it will become effective on January 1, 2014. The bill passed both chambers of the General Assembly unanimously. Governor Quinn will have until August 19, 2013, to approve this bill.
The Illinois General Assembly will reconvene for the Fall Veto Session on October 22nd. The Fall Veto Session is expected to be a relatively short session, ending on November 7th, with a limited agenda. Following the Fall Veto Session, the General Assembly will likely stand in recess until mid-January when it convenes for the 2014 Spring Session. Illinois employers should continue to expect that the legislature will consider significant changes to Illinois employment law and are advised to closely monitor the proceedings of the General Assembly in order to respond accordingly.