I Don’t Want to Wear a Mask…Part 3: Land of the Mask Free and Home of the Brave

Contributed By Michael Wong, May 14, 2021

Blue medical face masks isolated on white

On May 13, 2021, the CDC issued new guidance stating that those who are fully vaccinated can resume activities without wearing a mask or social distancing. Following the CDC’s announcement, President Biden lifted the mask mandate that was required by staff and visitors of the White House.  

While the CDC has issued this guidance, a patchwork of state and local policies or rules are popping up making clear that we are not going to be mask free quite yet. More importantly, the CDC’s announcement contained a big “EXCEPTION” by stating “except where required by federal, state, local, tribal or territorial laws, rules and regulations, including local businesses and workplace guidance.”

To be clear, the CDC has not made any changes to its workplace guidance regarding the use of masks. The CDC guidance still advises employers to “encourage employees to wear face coverings in the workplace, if appropriate.” More importantly though for employers, OSHA still states that employers and businesses should require the use of face masks and emphasizes that “employers are responsible for providing a safe and healthy workplace free from recognized hazards likely to cause death or serious harm. In fact, President Biden’s “lifting of the mask mandate” for staff and visitors could potentially be considered a violation of CDC and OSHA guidance regarding workplaces.

Employer and business compliance with CDC and OSHA Guidelines is still very important, especially with the potential for fines. Recently, OSHA issued a $136,532 penalty and citation to a Massachusetts company for prohibiting employees and customers from wearing face coverings in the workplace and requiring employees to work within six feet of each other and customers for multiple hours while not wearing face coverings, finding that the company’s actions put its employees safety at risk of recognized hazards that are causing or likely to cause death or serious physical harm.

The issue gets even more complicated at the state and local level. Some states, including New York, New Jersey, North Carolina, and Maine, have advised that they will not be modifying their mask mandates at this time. Many other states, including Illinois, Kentucky, Minnesota, Nevada, Oregon, Pennsylvania, Connecticut, and California have begun adjusting their mask mandates and guidance (including setting dates for them to tentatively end).  While other states, including Alabama, Arkansas, Iowa, Mississippi, Montana, New Hampshire, and Texas, have already rescinded their statewide mask mandates. To make things even more confusing, even in the states that have rescinded the state wide mask mandates, some local governments have maintained mask mandates including those for employees and/or customers. Then to make it even more unclear, Indiana just passed a law stating that the decision regarding masks is now controlled by city councils and mayors/elected officials and not local health officers. At least one county in Indiana, Marion County, which covers Indianapolis and its surrounding suburbs, has already had its City Council vote to continue its mask mandate.

What does this mean For Businesses?
This means that businesses must still require employees to wear masks in the workplace and must still require customers coming into the business to wear masks unless otherwise allowed by state or local guidelines, and even then you are still required to comply with OSHA requirements.

This also means that training, education and communicating with employees and customers will be vital within the next few weeks and months. Many employees and customers will hear about the federal “unmasking,” but will not understand that it does not apply to employers or businesses based on state or local requirements or guidelines. Moreover, as OSHA has now made clear by fining businesses, there are repercussions for employers and businesses violating the face mask requirements and guidance. 

Training for employees should include methods on addressing, managing and de-escalating conflicts with customers and between employees. In particular, re-emphasizing and educating employees on how to communicate the business’ policies and more importantly the reason why the business’ policies have not changed. This is vitally important to avoid “viral videos” of confrontations as businesses will no longer be able to point to a presidential mandate or executive order to validate mask policies. Rather, businesses will have to educate employees and customers on federal, state and local requirements and guidelines for businesses and make clear that the “mask free” announcement for those with vaccinations are limited to public and social activities and not so much the workplace, business interactions and shopping. 

Finally, don’t forget that employer and business obligations regarding reasonable accommodation of disabilities and religious beliefs under the ADA and Title VII are still in place. 

Due to the complexity and interplay of federal, state, local, tribal or territorial laws, rules and regulations, including CDC, OSHA and state and local health departments and governments, it is important to use legal counsel experienced and knowledgeable in labor and employment law to help you navigate these waters.

State Bill Would Limit Restrictive Covenants With Physicians

Contributed By Jeffrey Glass, May 11, 2021

Historically, a majority of states have allowed employers to use restrictive covenants with physicians—and only a handful of states (among them: Delaware, Massachusetts, and Rhode island) have prohibited that practice in whole or in part. However, as discussed in recent blogs, the current trend is for state legislatures to pass new laws that regulate and limit non-compete agreements, often as they relate to lower wage employees or employees below certain income thresholds.

Now, in what may be a harbinger of future legislative efforts to regulate restrictive covenants in the health care industry, the State of Louisiana is considering a bill that would specifically limit restrictive covenants for physicians.

The legislation at issue, Louisiana House Bill No. 483, would completely ban any type of contract that restricts the practice of medicine by “primary care physicians,” a term the bill defines as including doctors practicing family medicine, general internal medicine, general psychiatry, general pediatrics, obstetrics, and gynecology. It would also ban such agreements for any physician employed by the state, such as a state university hospital.

The legislation also sets limits on contracts that restrict the practice of medicine by “physician specialists,” which includes any physician not included in the definition of “primary care physician.” For “physician specialists,” a restrictive agreement would become unenforceable when the physician has put in three years of service to the employer. Practitioners sometimes call this type of arrangement a “burn off” restriction. Such restrictions are viewed as a way to allow the employer to realize the value of its investment in the employee over time, while allowing the employee to eventually be free of the post-employment restrictions.

The bill also sets limits for buy-out clauses for physician specialists. These are clauses where the physician or the new employer can pay money to the former employer to release the physician from the restrictions. The bill caps buy-out payments at the physician’s annual salary for the first year of the restriction, and provides that payments for any additional years are reduced on a pro rata basis.

Finally, the bill sets certain new rules for both “primary care physicians” and “physician specialists,” i.e., all physicians. The bill provides that, where any physician is terminated without cause by the employer, the restrictive covenant is unenforceable. It further provides that no restrictive covenant may restrict a physician from practicing within a “restricted geographic area” for a period of more than two years. “Restricted geographic area” is defined as the parish of the physician’s primary office location and up to two contiguous parishes. “Parishes” are Louisiana local government districts similar to counties.

This legislation would significantly change Louisiana law as it applies to physicians. Currently, Louisiana, like the majority of states, allows such restrictions to be used with physicians provided certain conditions are met. The new legislation would completely ban such agreements for primary care physicians and set significant limits on the use of such agreements with physician specialists.

We will keep readers apprised of further developments with the Louisiana legislation, as well as legislation in other states related to restrictive covenants in the health care industry.

IDOL on the PROWL: Looking At Non-Union Contractors to Debar for Technical Violations of the Illinois Prevailing Wage Act

Contributed By Jeff Risch and Peter Hansen, May 7, 2021

hand signing contract on white paper

Contractors beware – the Illinois Department of Labor (IDOL) has ramped up audits of contractors as labor unions and related organizations flood the IDOL with “complaints. Remember, under the Illinois Prevailing Wage Act (IPWA), a prevailing wage “complaint” need not be verified or even submitted to the IDOL under penalty of perjury. The IDOL will investigate each and every “complaint” regardless of merit and, while historically the main focus of the IDOL was to ensure proper and full payment of the actual prevailing wage, it is now seeking to issue violations and debar contractors for technical violations (i.e. failure to post rates or provide written notice to contractors or lower tiered contracts).

Typically, debarment from contracting for public works (for up to 4 years) occurs only after the IDOL issues two distinct formal written notices of IPWA violations to a contractor within 5 years. Until recently, the IDOL considered the severity of the violation, the contractor’s history, and whether the contractor generally complied with other IPWA obligations before issuing a violation notice. The IDOL is now moving towards a philosophy of issuing a formal notice of violation for technical violations – especially when it comes to non-union contractors.

The IDOL’s increased activity is exceptionally troubling for all contractors given the IPWA’s broad definition of “violation” under its Administrative Rules. Pursuant to the IDOL’s prevailing wage rules, a violation occurs whenever the IDOL determines that the contractor:
• failed to pay the prevailing wage to one or more employees performing work covered under a public works contract;
• failed to keep, produce, or submit accurate records demonstrating compliance with the IPWA;
• refused to comply with the certified payroll filing obligations (this now requires the use of the IDOL’s own online electronic portal system);
• refused to allow the IDOL’s access to inspect the contractor’s records;
• failed to insert a written stipulation that prevailing wage rates be paid into each subcontract and into the project specifications;
• failed to obtain a bond guaranteeing performance of the prevailing wage clause (when required by the public body to do so); or
• failed to post or communicate to the workers the applicable prevailing wage rates on the public works project site.

There’s clearly a lot of room for the IDOL to issue violation notices for technical violations that have nothing to do with the actual payment of the prevailing wage to the worker. The IPWA arguably has the most complex and administratively burdensome laws in the country. That’s on purpose!

All contractors must be acutely aware of the IDOL’s increased audit activity – and unprecedented scrutiny. And, in light of Springfield’s allegiance to organized labor these days, non-union contractors are in particular need to be doing everything possible to make certain they are complying with the IPWA’s technical requirements, beyond the payment of the actual prevailing wage.

What Damages Can You Recover In A Non-Compete Case?

Contributed By Jeffrey Glass, May 6, 2021

employment law books and a gavel on desk in the library. concept of legal education.

In the typical non-compete lawsuit, an employer seeks to block the defendant, often an ex-sales representative, from calling on or doing business with the company’s clients. However, in some cases, the defendant succeeds in taking some business, thereby raising the issue of monetary damages.  So, how are damages calculated in a non-compete case? 

In a recent decision, the U.S. District Court for the Northern District of Illinois addressed this issue. In Zurich American Ins. Co. v. Hill, the defendant insurance salesman admitted that he improperly did business with a certain client of the plaintiff; thus the only issue was calculating an appropriate monetary award. The court explained that, pursuant to Illinois law, the employer is entitled to recover “net lost profits” that were traceable to the defendant’s breach. Net lost profit is gross revenue based on the contract price, less any expenses necessary for plaintiff’s performance of the contract. Depending on the circumstances, a plaintiff’s expenses could include direct costs (e.g., labor, materials) and indirect costs (e.g., overhead expenses). Direct costs, along with any portion of indirect costs that can be avoided by defendant’s breach (“variable indirect costs”) are subtracted from the gross revenue. But any portion of indirect costs that cannot be reduced by defendant’s breach (“fixed indirect costs”) are not subtracted, because plaintiff already incurred and paid those costs.

Applying this framework, the employer established that the company’s overall customer retention record was over 90% and therefore the customer that the defendant “took” could reasonably have been expected to stay with the plaintiff for a year. Although the plaintiff argued that it should recover three years of net profit, the court declined this request based, among other things, on evidence that the customer in question had been somewhat inconsistent with its business in recent years. 

After holding that the employer was entitled to one year of net profit on the customer in question, the court then deducted direct costs. These were the commission that the sales representative would have received, and also insurable losses that reasonably could have been expected to have been paid out on the polices. 

Finally, there was a dispute over whether some amount of variable overhead should be deducted, which would have further reduced the employer’s net lost profit. The court stated that some type of variable overhead could only be deducted if the defendant could show that the overhead could have been avoided by the defendant’s breach. Because the defendant could not prove any such overhead, the court declined to deduct any type of variable overhead.   

Therefore, the final award represented the gross revenue that would have been received from the customer in question for one year, minus the sales representative’s commission and the losses that would have been paid out on the policy.

BIPA’s Statute of Limitation and Claims Accrual – Two Anticipated Decisions in State and Federal Courts

Contributed By Carlos Arévalo and Molly Arranz, May 4, 2021

fingerprint scan provides security access with biometrics identification

For the past several years, we have periodically reported regarding the proliferation of class actions and other litigation under the Illinois Biometric Information Privacy Act (BIPA).

Under BIPA, entities may not “collect, capture, purchase, receive through trade or otherwise obtain” or store a person’s biometric information without informing an individual in writing about the collection or storage of said information. Entities collecting biometric information must also specify the purpose for its collection and storage and how long it will be kept. Finally, entities must obtain a written release signed by the individual whose information has been collected.

While it has been approximately 13 years since BIPA was enacted, there are still a number of issues being litigated. One thing is certain: BIPA packs a punch with eye-popping statutory damages and monetary awards that can lead to anywhere from $1,000 to $5,000 per violation plus attorneys’ fees. Moreover, considering that an alleged violation is enough to bring a suit, BIPA is a class action dream – bearing in mind that if an employer is collecting biometric data on one individual, it is likely collecting it on many individuals.

Two critical questions will soon be addressed. First, at the Illinois appellate level, clarification is expected on the applicable statute of limitations. While a federal court in the Southern District of Illinois seemed prepared to accept a five-year statute of limitations as controlling, that court acknowledged that BIPA precedent was still “developing.” Indeed, two pending cases, namely Tims v. Black Horse Carriers, Inc. and Marion v. Ring Container Techs, will likely decide “whether BIPA claims are potentially subject to a one-, two-, or five-year statute of limitations.”

Secondly, the Seventh Circuit is expected to rule on the issue of whether or not claims accrue with each scan as opposed to only the first collection of biometric information.  In Cothron v. White Castle, the district court found that each biometric scan was a “discrete, individual act and not an accumulated course of conduct” and not a “continuing violation.” The court fully acknowledged that such interpretation might lead to large damages. However, citing Illinois precedent, the court added that where the statutory language is clear, it must be given effect even though the consequences may be “harsh, unjust, or unwise.”

In light of these risks and ongoing filings, employers must remain vigilant and ensure compliance with BIPA requirements by:

  • Analyzing the type of biometric information being collected
  • Evaluating what BIPA compliant disclosures are in place
  • Ensuring that a BIPA policy is in effect and properly applied
  • Staying alert and on top of court decisions and pending regulations

For our part, we will monitor the status of the Tims, Marion and Cothron cases and ongoing BIPA litigation and will continue to provide updates as developments arise.

Illinois Lawmakers Consider Expanding Mandatory Retirement Savings Program to Small Employers

Contributed By Kelly Haab-Tallitsch, April 30, 2021

savings, hand stacking gold coins isolated on white background

The Illinois General Assembly is considering a bill (H.B. 117) that would make several amendments to the Illinois Secure Choice Savings Program Act, including extending the requirement to offer employees a retirement savings plan to employers with 5 to 24 employees. H.B. 117 was passed by the Illinois House of Representatives earlier this month and is currently pending in the Illinois Senate.

Currently, Illinois employers that have 25 or more employees and have been in business at least two years are required to participate in the state-run Illinois Secure Choice Savings Program (Secure Choice Program) or offer another qualifying retirement savings plan to employees. H.B. 117 would lower the threshold to employers with 5 or more employees.

If H.B. 117 is enacted into law, Illinois employers that employed 5 or more employees during each quarter of the previous year, have been in business at least two years, and do not offer another retirement savings plan will be required to participate in the Secure Choice Program.

Covered employers are required to automatically enroll employees in the program and withhold 5% of an employee’s compensation (up to an annual IRS maximum), unless the employee elects a different amount or opts out of the program. Employers remit employees’ contributions to the state-run program. Those contributions are then deposited into Roth Individual Retirement Accounts (IRAs) for each participant and invested at the participant’s direction among a menu of investment alternatives. Employer contributions to the program are not permitted.

H.B. 117 includes the addition of automatic increases to employee contributions, up to a maximum of 10% of an employee’s wages, modifies penalties for noncompliance,  and makes changes to the enforcement process.

Under H.B. 117, the deadline to enroll employees would be no sooner than September 1, 2022 for employers with 16 – 24 employees, and no sooner than September 1, 2023 for employers with 5 – 15 employees. The Illinois State Treasurer’s office will notify employers directly (by mail or email) when they are required to register. Employers will receive two notifications – an early registration notice 120 days prior to the required registration date, and a second notice 30 days prior to the registration date.

H.B. 117 is still pending in the Illinois Senate, but based on the strong support for the bill, it appears likely H.B. 117 will pass and be signed into law.

Employers that offer another qualifying retirement savings plan are exempt from the Secure Choice Program. As such, small employers should begin examining the options available to determine whether implementing a qualified retirement savings plan, such as a Simplified Employee Pension, SIMPLE IRA, or 401(k) plan may be a better alternative than the Secure Choice Program.

SmithAmundsen’s employee benefits team will continue to monitor the status of H.B. 117 and provide additional information as it becomes available.

Health Care Workers and Labor Unions: The COVID “Bump” and the New Administration’s Efforts to Unionize More Workers

Contributed By Beverly Alfon and Michael Hughes, April 28, 2021

COVID-19 Pandemic Allows Unions to Make Inroads with Health Care Workers

For health care workers, the issues of staffing, wages and benefits are typically what unions have focused on in their organizing campaigns. Against the backdrop of the COVID-19 pandemic, these issues are heightened with the added urgency of worker safety. The realities created by the pandemic have and will likely continue to make their impact on health care workers – even prompting some who never may have considered union representation – to reconsider their position. For example, in September 2020, nurses at a hospital in Asheville, North Carolina, voted to become unionized. Yes!  North Carolina, a traditionally red, anti-union state. The union won 70% of the vote. The nurses cited issues related to PPE, testing and exposure notification inconsistencies.

Unions have certainly taken notice of this opportunity to organize and are seizing it. After all, according to the Bureau of Labor Statistics, by 2028 some 3.4 million new jobs will be added in health care and social assistance. The sector will account for about a third of all new employment in the U.S. by that time. In August 2020, a Colorado state inspection revealed that understaffing led to a patient death at a Denver area hospital. The Service Employees International Union (SEIU) local union – which does not represent the employees at the hospital – nonetheless engaged in an aggressive campaign alleging unsafe practices by the hospital’s parent company.

Health care workers who are already unionized – who in the past may have been complacent about union objectives and work issues – also appear to have become galvanized and willing to take action, including voting to strike. At the end of 2020, health workers in multiple states went on strike over staffing issues and pay. 

  • In Chicago, about 6,000 certified nursing assistants and food service and housekeeping employees at 64 nursing home facilities called off a planned strike after reaching a tentative agreement with employers for higher base pay, hazard pay, adequate personal protective equipment and paid sick days related to COVID-19.
  • In Providence, Rhode Island, about 100 nursing assistants and maintenance workers and other staff at a nursing home began a strike over demands for mandatory minimum staffing levels and pay increases. The strike followed a series of protests following outbreaks of coronavirus in nursing homes in Rhode Island and across country exposed staffing shortages. 
  • Near Philadelphia, nurses went on strike at a hospital. A month later, the owner of the hospital announced a labor agreement with the nurses’ union that gave nurses “a voice in discussions on staffing” while preserving the hospital’s right and authority to make all staffing decisions. 
  • In Chicago, nearly 700 caregivers walked off the job at 11 nursing homes, apparently triggered by the company’s discontinuance of hazard pay during the pandemic. A tentative agreement was reached after a 12-day strike, including significant wage increases, pandemic pay increase, additional five days of COVID-19 related sick time, and significant PPE guarantees and protections.
  • In Albany, New York, hundreds of nurses went on strike, citing issues wages and benefits, understaffing, and the hospital’s handling of the pandemic.
  • In Connecticut, nursing home workers continue to inch towards a major strike with initial union votes at 33 facilities overwhelmingly favoring a strike.

Clearly, COVID-19 is strengthening organized labor’s appeal and lengthening its reach. Couple that with a pro-labor agenda in the Biden administration and in Congress, and we are staring at a galvanized labor movement.

The Pro-Union Agenda at the Biden Administration and the National Labor Relations Board

On the eve of the presidential election in 2020, nominee Joe Biden vowed to be “the most pro-union president you’ve ever seen.” Upon being sworn in, President Biden wasted no time in making headway toward that promise. On his very first day in office, President Biden fired the National Labor Relations Board’s General Counsel, Peter Robb. The NLRB GC determines which cases are prosecuted at the labor board, and in so doing, sets policy initiatives and labor law enforcement guidance. Robb’s term was not set to expire until November 2021, and his firing marked the first time in history that an incoming President fired the sitting NLRB GC without letting him serve out his term. (The next day President Biden also fired the NLRB’s Deputy GC). Union leaders had called for Biden to sack Robb over their disagreement with Robb’s policy prerogatives and what they perceived as an anti-union agenda. Within days, the acting NLRB GC appointed by President Biden issued memorandums reversing many of Robb’s policy directives—unsurprisingly all of those reversals favored labor unions (but not necessarily workers). Among the policy provisions established by the acting GC’s newly issued guidance memos are provisions giving unions wider protection against accountability when they fail to properly represent workers’ rights; allowing unions to hide certain dues information from workers; and allowing unions to limit the time frame for workers to rescind a dues authorization.

In the coming months, the makeup of the 5-member NLRB (the body that makes final determinations in cases of alleged unfair labor practices and union representation issues) will also swing from its current Republican majority, to a Democratic majority, as there currently is one vacant seat waiting to be filled, and another seat will expire on August 27, 2021. With these changes (at the GC and board levels) it is a certainty that the NLRB will begin a period where its policy and enforcement priorities make it easier for unions to organize unrepresented employees; give unions additional ammunition and leverage in organizing campaigns and at the bargaining table; and remove employer tools to resist or counter union organizing.  

Congress Advances Union-Friendly Legislation

Not to be outdone by the Executive branch, Congress also is moving quickly to appease its labor union constituents, mainly through the re-introduction of the Union-friendly, “PRO Act.” We recently wrote about the nuts and bolts of that pending legislation, which has passed the House of Representatives and awaits action by the Senate. Currently, 47 of the 50 Democratic senators support the PRO Act, and labor unions and other organizing groups have set out to bombard the remaining three Democratic senators with an onslaught of demonstrations, phone calls, and other pressure tactics, in order to bring them to heel. The PRO Act would nearly completely re-write labor law as we know it, with an aim to making it a near impossibility for any organization to resist a union organizing campaign. Among the many drastic changes to long-standing labor law, the PRO Act would:

  • Outlaw Right-to-Work laws;
  • Remove any and all restrictions on Union strike activities (including removal of restrictions against intermittent strikes, partial strikes, and slow-down strikes);
  • Allow unions to strike and boycott directly against entities they have no labor dispute with, in order to pressure that entity to stop dealing with a company the Union does have a dispute with;
  • Impose penalties against employers who commit unfair labor practices (up to $50,000 for a first offense);
  • Erode the sanctity of secret ballot elections, allowing the Union alone to name the means and manner of election (mail ballot, off-site election, electronic election) and providing for a second-chance “card-check” election, if the Union loses and alleges an unfair labor practice;
  • Ban an employer’s ability to withdraw recognition from a union, even if 100% of all employees sign a petition saying they no longer want the union; and
  • Many more pro-union provisions.

While the PRO Act is not yet law (and likely will not be enacted wholesale, unless the Senate scuttles the filibuster), it is increasingly likely that certain portions of the PRO Act will find their way in to other legislation in the upcoming legislative sessions. Again, all of these developments are for one simple purpose: making it easier for unions to organize new groups of workers. As noted above, health care facilities, especially including long-term care facilities, have been a special focal point for many union organizing drives of late, with savvy union leaders leaning on the COVID-19 pandemic to make inroads with employees in the industry. A union-friendly Administration, NLRB, and Congress will only aid and embolden the SEIU and other unions seeking to organize health care workers to redouble their efforts.

What to Do?

  1. Get your union avoidance plan in place.
  2. Identify who your “supervisors” are (as defined by the National Labor Relations Act) and get them trained on identifying and dealing with union organizing. A “supervisor” cannot be represented by a union. They are also agents of your company, so training is key. They should be directed on what their role should be in avoiding union organizing and what they can and cannot do and say in the event that union organizing begins.
  3. Review policies for clarity, perceived unfairness, and employee relations. A union will often focus employees on (real or perceived) unfair policies or unequal implementation of work rules.
  4. Benchmark wages and benefits. A union will often promise more money. So, it is best to be prepared with a response.
  5. Identify employee relations problems now and deal with them before employees turn to a union. Get feedback from the group of employees who are vulnerable to union organization. Sometimes, it is as simple as tweaking a supervisor’s management-style.
  6. Train management on positive employee relations. Your supervisors need to know about the importance of providing regular feedback to employees and maintaining open communication with them.
  7. Get a communications plan in place in the event that union organizing begins or has begun.
  8. In light of current union tactics of staging demonstrations and strikes, even in support of organizing efforts, it also is advisable to have a comprehensive strike plan in place, especially once organizing efforts become known.

Being aware of the potential threat of union organizing at your workplace is not enough. Far too often employers are surprised when union organizing begins or a formal petition for recognition is filed. Assessment and planning are necessary now so that if the need arises, a response can be timely, effective, and within the parameters of the National Labor Relations Act. 

Save the Date! Health Care Industry Webcast May 20: Documenting Discipline Without Amplifying a Legal Claim or Lawsuit

Heather Bailey and Suzannah Wilson Overholt invite health care industry managers and human resources personnel to join them on Thursday, May 20, 2021 at 10am CT for a 60-minute webcast on how to avoid the 7 deadly sins and how to properly discipline health care employees while not creating exhibits and records that can exacerbate a fraud case or claims of malpractice, abuse or negligence.

State Survey – Considering Criminal Convictions in Private Employment Decisions

Contributed By Suzanne Newcomb, April 22, 2021

cv review flat illustration. hand with magnifier over curriculum vitae

As we previously discussed, Illinois has moved beyond “ban-the-box” and now significantly restricts employers’ ability to consider criminal convictions when making employment decisions. (For more details see our employer’s guide and join our complimentary webcast on April 29, 2021.)

Illinois is not an outlier. Several states have enacted or are considering similar legislation. Below is a short summary of these state laws applicable to private employers. All of these statutes have exceptions. Note too, the fact that a state is not listed does not necessarily mean it has no restrictions. These laws are nuanced and rapidly changing and many local governments have enacted their own regulations. Seek advice from trusted counsel before basing an employment decision on an individual’s criminal history.

California: Employers with 5 or more employees may not deny a position based (in whole or in part) on a criminal conviction without first making an individualized assessment (in accordance with the statute) as to whether the conviction has a direct and adverse relationship to the job such that it justifies denying the position. The law sets forth a detailed process to regulate an employer’s consideration of criminal convictions and imposes notice, disclosure, and waiting period requirements if an employer acts on a conviction.

Connecticut: It is currently unlawful to deny employment with the state on the basis of a criminal conviction without considering factors set forth in the statute. Pending legislation would expand the law to private employers.

Hawaii: It is unlawful to base an employment decision on a conviction unless it is a felony conviction in the last 7 years, or a misdemeanor conviction in the last 5 years, and the conviction bears a “rational relationship” to the duties of the position. 

New York: It is unlawful to take an adverse action based on criminal history unless there is a direct relationship between the conviction and the employment position or if the employment would pose an unreasonable risk. The statute includes factors to be considered in making this assessment. Upon request, the employer must provide a written statement setting forth the reasons for denying employment on the basis of conviction. 

Pennsylvania: It is unlawful to consider a job applicant’s conviction history unless the conviction relates to the applicant’s suitability for the particular position sought. An employer also must notify the applicant if employment was denied, in whole or in part, on the basis of criminal history.

Washington D.C.: Private employers with more than 10 employees may not base employment decisions on criminal convictions unless there are reasonable and legitimate business reasons in accordance with factors set forth in the statute.

Wisconsin: It is unlawful to discriminate on the basis of an arrest record or conviction record. There are exceptions to this rule for convictions and pending criminal charges that substantially relate to the particular job.

In addition, ban-the-box laws apply to private employers in California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Massachusetts, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, Washington, and Washington D.C., as well as many other cities and counties across the country (and a total of 36 states have some form of ban-the-box laws applicable to public employment). Many state and local governments also prohibit or regulate employers’ consideration of convictions that have been sealed or expunged, arrests that did not result in conviction, and/or juvenile convictions.

Illinois Legislature Considering Freedom To Work Act Amendments That Target Non-Compete And Non-Solicitation Clauses

employment law books and a gavel on desk in the library. concept of legal education.

Contributed By: Jeffrey Glass, April 19, 2021

In recent years, many states have enacted legislation directed at employment contracts containing non-compete and non-solicitation clauses. Illinois first did so in 2016 with the Freedom to Work Act (the Act), which bans certain Illinois employers from entering into non-compete agreements with low-wage employees.

Now, the Illinois General Assembly has taken the matter up again with additional proposed amendments to the Act.

Although the new legislation has not been finalized, some provisions that appear likely to be included in the final version are: income thresholds for employees who are not “low wage,” a requirement that the employer provide the employee with a copy of the contract in advance of signing it, employee-friendly attorney’s fee-shifting provisions, and exemptions for union workers.  While the legislation primarily is geared toward protecting employees, it also helps employers by clarifying the state of the law on several issues, including clearer standards for the enforceability of non-compete clauses.

The amendments are projected to take effect on June 1, 2021, and will not apply to contracts entered into before that date.  Employers should contact their employment counsel to make sure any agreements entered into on or after the effective date comport with the new law. SmithAmundsen attorneys are working closely with employer-side groups on the legislation and will update readers of this blog as further developments arise.