Massive Changes to Illinois Employment Law Now Apply to ALL Illinois Employers
One employee. That is all it takes for an Illinois company to be subject to the requirements and obligations of the Illinois Human Rights Act (the “Act”) as of January 1, 2020. The expansion of the Act’s application to every Illinois employer (not just those with 15 or more employees) is only one of several significant changes to the state’s employment laws that businesses need to understand and comply with to avoid liability, penalties, and other costly and disruptive consequences.
Not only did the dawn of the new decade see amendments to the Human Rights Act, but it also brought with it entirely new statutes that add a host of additional limitations as to what employers can and cannot do before, during, and after an employee’s tenure.
Expanded Definition of “Unlawful Discrimination” and “Harassment”
The discrimination prohibited under the Act now includes adverse employment actions against an employee based on a person’s “actual or perceived” membership in a protected class. Similarly, the law now prohibits “harassment” based on a person’s “actual or perceived” status as a member of a protected class that “has the purpose or effect of substantially interfering with the individual’s work performance or creating an intimidating, hostile, or offensive working environment.”
Additionally, a company’s employees are no longer the only people protected from harassment. The Act makes it illegal to harassindependent contractors, consultants, and any other person performing services for the employer pursuant to a contract.
Additionally, beginning July 1, 2020, and by July 1 of every year after that, all Illinois employers must disclose any adverse judgment or administrative ruling relating to unlawful harassment or discrimination against the employer during the prior year. Employers may also need to disclose information about any sexual harassment or discrimination settlements upon request of the Department of Human Rights.
Annual Sexual Harassment Prevention Training and Reporting Required
If your company has an employee in Illinois, you now need to provide sexual harassment prevention training to all your employees every single year. The training must include:
- an explanation of sexual harassment;
- examples of conduct that constitutes unlawful sexual harassment;
- a summary of relevant state and federal laws prohibiting sexual harassment and the remedies for violations of these laws; and
- a summary of the employer’s responsibility to prevent, investigate, and correct sexual harassment.
The Illinois Department of Human Rights has been charged with offering a model training program free of charge. If you’ve been contacted by outside vendors seeking to sell a program to you, it might be wise to wait for a few months first to see if the IDHR’s program will work for your business instead. However, there is no guarantee that the program will be issued in time, or that it will be accessible for all employers, so be sure to institute a reminder that the training must be completed by year end regardless.
Your Confidentiality and Arbitration Provisions May No Longer Be Enforceable
An entirely new statute, the Workplace Transparency Act, (which is the same law that requires the sexual harassment training outlined above), should cause Illinois employers to rethink and rewrite employment and separation agreements that contain confidentiality or mandatory arbitration provisions.
Effective January 1, 2020, this law attempts to address efforts by employers to keep discrimination and sexual harassment claims under wraps and away from the courthouse.
Specifically, in any employment, separation or settlement agreement entered into after January 1, the new law prohibits any unilateral confidentiality or non-disparagement clause which purports to cover sexual harassment or discrimination claims. It also bars unilateral conditions of employment that would prevent a current employee or candidate from reporting unlawful discrimination, sexual harassment, or retaliation. Under the law, “unilateral” means that a provision is a non-negotiable requirement for obtaining or retaining employment.
That said, confidentiality provisions may still be valid and enforceable if particular criteria are met and the employer can demonstrate that the clause was the product of “actual, knowing, and bargained-for consideration” from both parties. These requirements should be familiar for any company who has prepared releases for age-discrimination (ADEA-covered) claims, including a right to consider and revoke. Specifically, any such agreement must make clear that:
- confidentiality is the documented preference of the employee, candidate, or former employee and is mutually beneficial to both parties;
- the employer notifies the employee, candidate, or former employee, in writing, of his or her right to have an attorney or representative review the agreement before it is signed;
- there is valid, bargained for consideration in exchange for the confidentiality;
- the employee does not waive any claims of unlawful employment practices that accrue after the date of execution of the agreement;
- the employee gets 21 calendar days to consider the contract; and
- the employee has seven calendar days following execution to revoke the agreement.
Of equal significance is the law’s prohibition on unilateral mandatory arbitration provisions that purport to cover “unlawful employment practices,” which means any form of unlawful and actionable discrimination, harassment, or retaliation under Title VII, the Illinois Human Rights Act, or other applicable and relevant law. Employers can still include arbitration clauses in their contracts, but if they do so, the provision must expressly exclude harassment and discrimination claims.
The law’s ban on harassment and discrimination-related arbitration agreements will likely face challenges for conflicting with the Federal Arbitration Act (“FAA”). At the moment, however, Illinois employers should not rely on any provisions that may have previously prevented employees from pursuing such claims in civil litigation.
These sweeping changes to Illinois’ employment law landscape should give pause to all companies with employees in the state. Existing policies, practices, and agreements may no longer be compliant with the law, and additional obligations on employers will necessitate new training and preventative measures.