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Employment Law News

August Edition 2012

General Assembly Called into Special Session

Governor Quinn has called the General Assembly back to Springfield on August 17 for a special session consideration of pension reform. No legislation was specifically identified in the Governor’s message. The House Rules Committee met earlier this week and advanced SB 3168 [1] to the Personnel & Pensions Committee. The House had originally been scheduled to meet tomorrow to consider the expulsion of Rep. Derrick Smith. Rep. Smith was indicted earlier this year for bribery. It is unlikely any other activity will occur during the one day scheduled special session. No action is expected at this time in the Senate.

IDES Director Seeks to Revamp Agency’s Mission

Illinois Department of Employment Security (IDES) Director Jay Rowell met earlier this month with the Council’s Unemployment Insurance Committee to discuss the status of Illinois’ Unemployment Insurance System. Director Rowell updated the Committee on the implementation of various tools by IDES to fight fraud and reduce the number of improper payments out of the UI Trust Fund. He indicated that the State had recently sold bonds to repay the nearly $1.5 billion owed to the federal government for benefits paid that exceeded employer taxes remitted the past several years. The borrowing plans and legislative changes are expected to save $240 million in interest as officials anticipate an all-in borrowing rate of under 3%. It leaves existing benefits intact and staves off increased business taxes. The funding changes are expected to save businesses at least $400 million through 2019 by eliminating penalty taxes that further federal borrowing would trigger. It also would provide a 16% unemployment insurance tax reduction for companies that did not lay off workers during the recession.

Another important message from the Director was his goal of transforming IDES’ mission from a focus on unemployment to one of employment. The strategy is built in large part around the state’s new IllinoisJobLink.com [2] labor exchange, which launched in April of this year.  To hear more about the new initiatives at IDES read Doug Whitley’s recent President ‘s Message-New Workforce Readiness Resources for Employers [3].

The Committee also provided feedback to the Director regarding employer service deficiencies and ideas to help employers navigate the unemployment system.

Upcoming ELC Committee Meetings

Ted Phlegar, Senior Counselor with the Workforce Freedom Initiatives of the U.S Chamber of Commerce will be our guest at the September 13th meeting of the Employment Law & Litigation Committee. From ambush elections to social media, and micro unions to cyber card check, the USDOL, NLRB and other federal agencies are attempting an end run around Congress to do organized labor’s bidding at the expense of small businesses and job creators, Mr. Phlegar will provide insight and an update on the latest labor issues at the federal level. Our meeting host is SmithAmundsen law firm in Chicago.

The Workers’ Compensation Committee is meeting September 5th in Springfield at the Rail Golf Course. The Committee will be preparing for the fall veto session, discussing legislative proposals and strategies to advance additional reforms. The working meeting is being held in conjunction with the Illinois Chamber’s annual PAC golf outing. For more information about the PAC golf outing [4].

Update on Employment Law Legislation

The Governor has up to 60 days to act from the date legislation is officially transmitted to his office.

Social Networking Limits: HB 3782 [5], sponsored by Rep. LaShawn Ford (D-Chicago)and Sen. Christine Radogno (R-Lemont), was sent to the Governor on June 20th for his consideration. This measure provides that it is unlawful for an employer to request a password or other account information in order to access an employee’s or prospective employee’s social networking website. HB 3782 allows for employers to maintain lawful workplace policies regarding internet use, social networking site use, and electronic mail use. This legislation does allow for employers to obtain information about an employee or prospective employee in the public domain. We are NEUTRAL.

Equal Pay Act Individual Liability: SB 2847 [6], sponsored by Sen. Heather Steans (D-Chicago) and Rep. Robyn Gabel (D-Evanston) was sent to the Governor on June 8th. As amended, individual liability under the Equal Pay Act occurs when the employer knowingly and willfully evades the payment of a final award or final judgment under the Act. We are NUETRAL.

Employment Discrimination: HB 3915 [7], sponsored by Rep. Elizabeth Hernandez (D-Cicero) and Sen. Iris Martinez (D-Chicago), changes the term “handicapped” to “disability”. The bill has sent to the Governor on June 13th. We are NUETRAL.

Service Members Protections: SB 3287 [8], sponsored by Sen. Tony Munoz (D-Chicago) and Rep. Elaine Nekritz (D-Northbrook), creates the Illinois Service Member Civil Relief Act which provides certain legal protections afforded to service members (and family members where specified) are subject to stated provisions of law. Amends the Illinois Administrative Procedure Act to set forth a provision concerning stays of contested case hearings for service members. Amends the Civil Administrative Code of Illinois to set forth a provision concerning deadline extensions for service members. Amends the Department of Central Management Services Law of the Civil Administrative Code of Illinois to make changes to the provision concerning bulk long distance telephone services for military personnel in military service (now on active duty). Amends the Military Code of Illinois, Illinois Municipal Code, Illinois Insurance Code, Public Utilities Act, Service Member’s Employment Tenure Act, Code of Civil Procedure, Landlord and Tenant Act, Uniform Commercial Code, Interest Act, Retail Installment Sales Act, Military Personnel Cellular Phone Contract Termination Act, and Motor Vehicle Leasing Act to make changes in certain provisions concerning military personnel. Amends the Illinois Human Rights Act to provide that a violation of specified provisions regarding legal protections for military personnel constitutes a civil rights violation under the Illinois Human Rights Act.  The measure was sent to the Governor on June 28th. We are NEUTRAL.

Subpoena Powers of the AG: SB 3677 [9], sponsored by Sen. William Delgado (D-Chicago) and Rep. Hernandez, amends the Illinois Human Rights Act concerning preliminary investigations by the Attorney General before the initiation of civil actions in circuit court. If a person fails to comply with a subpoena or if satisfactory copying or reproduction of any material requested in an investigation cannot be done and the person refuses to surrender the material, the Attorney General may file a petition for a court order for the enforcement of the subpoena or other request. Contains provisions regarding: venue; petitions to modify or set aside a subpoena; hearings; orders; and enforcement. Deletes language providing that if a person fails or refuses to file a statement or report or obey a subpoena, the Attorney General is deemed to have met the requirement of conducting a preliminary investigation and may commence a civil action to enforce the provisions of the Act. This measure was sent to the Governor on June 22nd . We are NUETRAL.

Prevailing Wage Notice: HB 5212 [10], sponsored by Rep. Charles Krezwick (D-Orland Park) and Sen. Maggie Crotty (D-Oak Forest) provides that a public body or other entity shall notify contractors and subcontractors of changes in prevailing wage rates. The notification requirement may be met by including in the contract that the prevailing rate is established by the Department of Labor and available on the IDOL website. The Governor received this bill on June 20th . We are NEUTRAL.

UI Administrative Changes: HB 5632, sponsored by Rep. Frank Mautino (D-Spring Valley) and Sen. Terry Link (D-Lake Bluff) has been signed into law as PA 97-791 [11] and goes into effect January 1, 2013. The new law cleans up of obsolete language and makes other nonsubstantive changes. It requires payments be made to the Department instead of the Director. It addresses several federal conformity issues including:

  1. Illinois law now provides for a monetary penalty for individuals who fraudulently obtain UI benefits that are greater than 15 percent of the amount that was fraudulently obtained.
  2. Illinois law now requires an employer account to be charged for benefits that were incorrectly paid if the incorrect payment was the result of the employer (or employer’s agent) failing to timely respond to information requests from the state UI agency and the employer (or agent) has established a pattern of failing to timely respond.
  3. Illinois law now requires employers to report to the state new hire directory the names of all employees rehired after having been separated for at least 60 days.

We supported HB 5632 [12].