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New Illinois Harassment Training Laws Set to Take Effect on January 1, 2020

On August 9, 2019, Governor J.B. Pritzker signed the Workplace Transparency Act ("SB 75" or "the Act"). In addition to requiring employers to provide its employees with annual sexual harassment trainings, SB 75 also effectively amends the Illinois Human Rights Act. Under the Illinois Human Rights Act, employees are protected from discrimination and harassment based upon protected characteristics. SB 75 effectively adds on to that. One of the more notable changes is that this Act makes employer-imposed agreements to arbitrate claims or to maintain confidentiality of unlawful practices (up to and including violations of the Illinois Human Rights Act, Title VII of the Civil Rights Act of 1964, or any other related State or federal rule or law that is enforced by the Illinois Department of Human Rights or the Equal Employment Opportunity Commission) as a condition of employment or continued employment as unlawful and void as a matter of public policy. In addition, for settlement or termination agreements requiring confidentiality, those employees must be given the opportunity to review and revoke an agreement and be allowed to ensure that the agreement is mutually beneficial for both the employer and employee.

Similarly, beginning on July 1, 2020, and continuing every year thereafter, SB 75 also requires that the employer disclose to the Illinois Department of Human Rights any final judgment or administrative ruling against it in the preceding calendar year. Employers must disclose to the Illinois Department of Human Rights the following:

(1) the total number of adverse judgments and/or administrative rulings during the preceding calendar year;
(2) whether any equitable relief was ordered against the employer in the any adverse judgment or administrative ruling; and
(3) how many of those adverse judgments and/or administrative rulings were due to unlawful harassment or discrimination (including sexual harassment).

If the employer fails to report or make any required disclosures, the employer could be liable for an entry of a civil monetary penalty against it for each violation. This civil monetary penalty depends on the number of employees the employer has and can range from $500 and up to, and including, $5,000 for each violation.

Moreover, SB 75 requires all employers to implement a yearly sexual harassment prevention training to ensure the workplace is safe for employees to report concerns about sexual harassment without fear of retaliation. This training applies to all employers with one or more employees in Illinois. This training program, at a minimum, must include the following:

(1) an explanation of sexual harassment consistent with the definitions implemented in SB 75 and the Illinois Human Rights Act;
(2) examples of conduct that constitute unlawful sexual harassment;
(3) a summary of relevant federal and State statutory provisions concerning sexual harassment, including the remedies available to victims of sexual harassment; and
(4) a summary of the employer's responsibilities in the prevention, investigation, and corrective measures of sexual harassment.

If the employer fails to comply with the sexual harassment prevention training requirements as outlined by the Act, the employer could be liable for an entry of a civil monetary penalty against it up to, and including, $5,000 for each violation. Thus, it is important that employers begin formulating their training schedules early in the year to ensure compliance with the requirements of SB 75. Our experienced employment attorneys can assist employers and businesses with preparation of this mandatory training and other requirements for employers and businesses under the laws.

New Overtime Ruled Stayed Pending Resolution of Federal Court Injunction

In May 2016, the Department of Labor (“DOL”) issued final rules regarding minimum overtime salary levels. The new overtime rule was intended to go into effect on December 1, 2016 and requires that nearly all salaried employees earning less than $913 per week, or $47,476 annually, be eligible for time-and-a-half overtime pay; more than doubling the previous minimum salary level. The new overtime rule also mandates that future automatic updates to the new minimum salary levels will occur every three years, starting January 1, 2020.

On November 22, 2016, a federal district court judge in Texas enjoined the Department of Labor from implementing the new overtime rule on December 1, 2016. This injunction was the result of a suit brought against the DOL by several states, business groups, and the U.S. Chamber of Commerce. The Plaintiff parties claim that the DOL exceeded its regulatory authority by substantially raising the salary threshold and providing automatic updates. The preliminary injunction will halt the implementation of the new overtime rule until the case is fully adjudicated.

Employers make take a risk by not implementing the new overtime rule on December 1, 2016. If the injunction is vacated by the district court judge or on appeal before the 5th Circuit, employers that elect to defer compliance may still have liability exposure for those employees who should have been treated as nonexempt. Employers should still have a plan to move forward under the new overtime rule, if necessary.

New Overtime Rule Effective December 1, 2016

In May 2016, the Department of Labor (“DOL”) issued final rules regarding minimum overtime salary levels. The new overtime rule goes into effect on December 1, 2016 and requires that nearly all salaried employees earning less than $913 per week, or $47,476 annually, be eligible for time-and-a-half overtime pay. The new overtime rule more than doubles the previous minimum salary level of $455 per week, or $23,660 annually.

Under the Fair Labor Standards Act, unless designated exempt, employees must receive overtime pay for hours worked in excess of 40 hours. This was the case prior to and under the new rule. However, the new overtime rule expands the regulations for determining whether an employee is exempt. Exemption applies to employees in a bona fide executive, administrative, or professional capacity; often referred to as the “white collar” exemption or the EAP exception.

To determine exemption status, the DOL evaluates an employee based on three tests: 1. the Salary Basis Test; 2. the Salary Level Test; and 3. the Duties Test. Under the Salary Basis Test, exempt employees must be salaried, meaning they are paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed. The Salary Level Test designates that exempt employees must be paid more than a specified weekly salary level. Under the Duties Test, exempt employees must primarily perform executive, administrative, or professional duties. The Salary Level Test and Salary Basis Test do not apply to doctors, lawyers, teachers or employees in outside sales. The new regulations have also adjusted the exception for some highly compensated employees (“HCE”), who now must earn more than $134,004 (up from $100,000) and satisfy a minimal duties test to be exempt.

The primary focus of the new overtime rule is to update the threshold of the weekly compensation level needed under the Salary Level Test for an employee to be excempt; now $913 per week, or the equivalent of $47,476 annually. The DOL set the new salary level at the current 40th percentile of earnings of full-time salaried workers in the lowest wage Census Region (currently the South). In an effort to maintain this status, future automatic updates to the new minimum salary levels will occur every three years, starting January 1, 2020. The DOL did not make any changes to the duties test for the administrative, executive, professional, or highly compensated employee exemptions.

The new rule is estimated to have a substantial impact by extending overtime pay to approximately 4.2 million people who were previously exempt. These employees will either: 1. need to be reclassified as non-exempt and paid overtime whenever they work more than 40 hours in a workweek; or 2. receive an increase in their salary to meet the new requirement. However, employers will experience some reprieve. Under the new overtime rule, for the first time, employers will be able to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the standard salary level, provided these payments are made on a quarterly or more frequent basis. Employers may also make a “catch up” payment. Penalties for violations of this rule could be severe and it is advisable that employers seek legal counsel before the implementation of the rule.

Sexual Harassment and Assault Client Wins Jury Trial and $151,800 in Damages (2016)

Circuit Court of Cook County, Illinois (September 30, 2016)

Our client filed a charge and complaint of discrimination based on sexual harassment, sex discrimination, retaliation, assault and battery against her former employer. Our client claimed that over the course of approximately 5 months, her employer made numerous inappropriate sexual comments and sexual advances towards her. Some of the claims included our client’s employer commenting on her appearance, touching her thigh, breast, and buttocks, grabbing her by the hips and pushing her head towards his lap, pulling her onto his lap and asking her to touch his erect penis, and offering to purchase her a car in exchange for sex. Our client rebuffed every instance of inappropriate sexual conduct and consequently was terminated.
 
After the complaint was filed, Defendants filed a Motion for Summary Judgement. This Motion was denied by the Honorable Judge and the case went to a jury trial. The jury found in favor of our client on all counts and awarded her $1,800 in lost wages, $15,000 in compensatory damages, and $135,000 in punitive damages.