Author Archives: smithamundsen

Illinois Hotel & Casino Employee Safety Act on Way to Passage

Contributed by Brian Wacker, April 2, 2019

Croupier behind gambling table in a casino.

More than two dozen Illinois State Senators have signed on to co-sponsor SB0075, a bill to enact the Illinois Hotel and Casino Safety Act (the “Act”). Likely to pass in the coming weeks, the Act will impose new requirements on hotels and casinos operating in Illinois to provide “panic buttons” to certain employees and adopt specific anti-sexual harassment policies.

What Does The Act Require?

The Panic Button

The panic button requirement is directed at hotel or casino employees placed in certain positions that may involve interacting with guests alone. 

Under the Act, hotels and casinos will be required to provide any employee who works in a guest room, restroom or casino floor “under circumstances where no other employee is present in the room or area, with a safety device or notification device.”  The device is to be provided to employees to use to summon help if they reasonably believe there is an ongoing crime, sexual harassment or assault or other emergency occurring in their presence. 

The Act will require the device to be provided to hotel or casino employees at no cost to them.

Anti-Sexual Harassment Policies

The Act will also require hotel and casino employers to develop or modify their anti-sexual harassment policies “to protect employees against sexual assault and sexual harassment by guests.”  Specifically, those policies will be required to contain provisions that:

  • Encourage employees to immediately report sexual assault or sexual harassment by guests;
  • Describe procedures that the employee and hotel or casino employer are to follow in cases of sexual assault or sexual harassment by guests;
  • Instruct employees to cease work and leave the immediate area where the danger is perceived until hotel or casino personnel or law enforcement arrive to assist;
  • Offer temporary work assignments to complaining employees during the duration of the offending guest’s stay at the hotel or casino (this could include assigning the employee to a different floor, station or work area);
  • Provide employees with necessary paid time off to sign police complaints against the offending guest and to testify in any legal proceedings which may ensue as a result of the sexual assault or harassment;
  • Inform employees that the Illinois Human Rights Act and Title VII of the Civil Rights Act provide them additional protections against harassment in the workplace; and
  • Inform employees that it is illegal for the hotel or casino employer to retaliate against employees who reasonably use the panic button device or otherwise avail themselves of the Act’s protections.

These new policies will need to be provided to all employees in English, Spanish and any other language predominant among the employer’s workforce.  The policies must also be posted in conspicuous places in the areas of the hotel or casino where employees can reasonably be expected to see them.

Employee Remedies for Violation of the Act

The Act will make it unlawful for a hotel or casino employer to retaliate against any employee who “reasonably uses” the panic button device, avails himself or herself of the protections of the Act, or who discloses, reports or testifies about any violation of the Act.  The Act also creates a private right of action for employees who allege violations of the Act. 

Remedies for violation of the Act are significant. In addition to injunctive relief to cease violations of the Act, it authorizes an employee to recover up to $350 per violation, with each day that a violation continues constituting a separate violation. The Act will also permit employees to seek equitable remedies such as reinstatement, and require that a hotel or casino employer pay reasonable attorneys’ fees and costs to successful employee claimants.  Note: this is a one-way street. The Act does not permit employers to recover attorneys’ fees and costs from unsuccessful claimants.

Employer Opportunity To Cure

Employees will, however, have to exhaust certain non-litigation remedies first.  Before bringing a claim under the Act, employees must (1) notify the hotel or casino employer, in writing, of the alleged violation and (2) allow the hotel or casino employer fifteen days to remedy the alleged violation. 

Effective Date

The Act will give hotel and casino operators in Illinois time to get into compliance. As currently drafted, the Act would not go into effect until July 1, 2020.

Illinois Mandatory Retirement Program Enrollment Deadlines Coming Later this Year

Contributed by Kelly Haab-Tallitsch, March 27, 2019

money plant growing

Illinois employers that have 25 or more employees and have been in business at least two years will be required to participate in the state-run retirement savings program or offer another qualifying retirement plan later this year.

The status of the Illinois Secure Choice Program was uncertain last fall following an amendatory veto issued by former Governor Bruce Rauner making the program optional, instead of mandatory, as discussed in a previous blog post. The Illinois legislature generally opposed making the program optional, and chose not to act on the amendment, effectively overriding the veto. As a result, the Secure Choice Program remains mandatory for covered employers that do not offer another retirement program. 

Employers with 100 – 499 employees must register for the Illinois Secure Choice Savings Program by July 1, 2019 and employers with 25 – 99 employees must register by November 1, 2019 (employers with 500+ employees were required to register in late 2018). 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. 

During the registration process, employers will provide basic information for the state to determine if the employer must participate in the Secure Choice Program (e.g., number of employees, and whether another retirement plan is offered). Participating employers will be required to automatically enroll employees in the savings program, withhold five percent of an employee’s compensation (up to an annual IRS maximum), and remit employees’ contributions to the state-run savings program, unless the employee elects a different amount or opts out of the program. Employer contributions to the plan are not permitted.

After registration, employers will be given instructions on how to enroll employees and remit payroll contributions, and provided enrollment forms and communication materials to give to employees. Employees will have 30 days to opt out or make adjustments to their savings rate or investment choices. At the end of this 30 day period, the employer must record employees’ elections in an online employer portal. Payroll deductions must begin within the following 30 days. Employers can remit employee contributions to the Secure Choice Program by ACH, wire transfer or check.

Employee contributions will be deposited into Roth Individual Retirement Accounts (IRAs) for each participant and invested at the participant’s direction among a menu of investment alternatives.

An Illinois employer that offers another qualifying retirement plan is exempt from the Secure Choice Program. This includes a 401(k) plan, 403(b) tax-sheltered annuity plan, 403(a) qualified annuity plan, Simplified Employee Pension plan, SIMPLE IRA plan, governmental 457(b) plan, or any other plan qualified under Internal Revenue Code section 401(a) (payroll deduction IRAs are not included). As such, employers required to participate in the Secure Choice Program should examine the options available to determine whether implementing a qualified retirement plan may be a better alternative. 

Employers can find additional information on the Illinois Secure Choice website.

The Death of Reserved Employee Parking?

Contributed by Sara Zorich and guest author Joe Demko, March 27, 2019

cars in a parking lot

The Tax Cuts and Jobs Act, passed in December 2017, is continuing to hit employers and employees in unanticipated ways. The latest impact is on special parking spaces for executives, employees of the month and employee reserved parking spots. Generally, under the IRS Tax Code (“Code”), an employer is not able to take a tax deduction for qualified transportation fringes (“QTFs”) provided to an employee. This includes parking an employer provides to its employees (i.e., the parking lot where the employees park). However, the Code provides two exemptions allowing the employer to take the tax deduction if they do either of the following: (1) tax the employee for the parking benefit or (2) make the parking available to the public. 

  • Option 1 – Normally the “employee benefit” of parking in the employer’s parking lot would be excluded from an employee’s income. However, if the “employee benefit” is greater than the fair market value limitation under the Code, then that amount must be included in the employee’s income. Obviously, increasing an employee’s taxable income based on the parking spot they use to do their job would be a very unpopular result for the employer’s workforce. 
  • Option 2 – Instead of taxing the employee for the parking benefit, a more popular exception is making the employer parking not only available to employees but also to the general public. However, this exception in not applicable under the amendments to the Code when an employer provides reserved or private parking spots that are only available to employees. If the employer maintains “reserved employee spots” (e.g., for the employee of the month or certain executives) then the employees must be taxed or the employer loses its business tax deduction.

The IRS has issued Notice 2018-99 that allows companies to change their parking arrangement on or before March 31, 2019 for retroactive effect to January 1, 2018. Thus, if you have “employee only” or “reserved spots” you must immediately review either eliminating the reserved spots (if the employer wants to keep the business deduction) or review the tax effect of the QTF and how this will impact both the business taxes and the employee taxes.

Ten Steps to Comply with the ADA’s Interactive Process

Contributed by Allison P. Sues, March 20, 2019

book with title the Americans with Disabilities Act (ADA)

Many employers would appreciate a clear road map when traveling the often winding roads of reasonable accommodations under the Americans with Disabilities Act (ADA).  However, there are no rigid routes for the interactive process.  After an employee requests an accommodation, the employer must engage in a good faith and flexible dialogue that addresses the employee’s specific medical limitation, request, job position, and work environment, among other factors.  That said, employers can find guidance in at least ten hard and fast rules on the reasonable accommodation process:

  1. An employer’s statutory duty to provide reasonable accommodations may begin before the employment relationship even forms. If an applicant requests reasonable accommodations to enable participation in the hiring or interview process, an employer must provide an accommodation unless doing so poses an undue hardship.
  2. Generally, an employer’s duty to engage in the interactive process is triggered whenever it learns that an employee needs an accommodation. Courts give employees wide latitude in how they make this known. The employee need not make the request in writing, identify a specific accommodation, or use specific terms such as “disability,” “ADA,” or “reasonable accommodation.”
  3. To start the interactive process, the employer should gather information from the employee, including the specific nature of the limitation, the specific difficulty or issue that the employee is experiencing at work, and what sort of accommodation the employee is seeking.
  4. An employer may require that the employee provide documentation from the medical provider most familiar with the employee’s disability in order to confirm the employee’s specific limitations and need for accommodation.
  5. Once the employer receives this medical documentation, it should ensure that any subsequent requests for updated records are reasonable and do not create an undue burden on the employee. For example, rather than requesting updates on a weekly basis, an employer may seek updated medical information at a time that coincides with an employee’s next scheduled appointment if the doctor’s assessment may change at that time.
  6. Employers should keep all information collected from employees about their disabilities and need for accommodations confidential. All medical documents should be maintained in a standalone file separate from the employee’s personnel file.
  7. The employer should also be collecting information on its end as it reviews the information submitted by the employee. For example, the employer should be reviewing the essential functions of the employee’s position and the employee’s ability to perform those functions, and determining which reasonable accommodations, if any, would enable the employee to perform his or her job. An employer need not provide an immediate response to an employee’s request for accommodation, but it must address the request promptly and keep the employee informed of any updates in the process to ensure there is open communication. Document all communication throughout the interactive process.
  8. The goal of the interactive process should be to allow the employee to perform his or her existing job through a reasonable accommodation. However, even if this outcome is unfeasible, the interactive process is not over. Employers should then consider if they can accommodate the employee through reassignment to a different vacant position for which the employee is qualified or through a temporary leave of absence.
  9. An employee is entitled to a reasonable and effective accommodation – not necessarily the accommodation of his or her choice.
  10. If an employer is able to reasonably accommodate an employee, it is advisable to keep the interactive process open even after the accommodation is implemented. The employer should reach out to the employee to ensure that the accommodation was provided as discussed and that it is indeed effective in enabling the employee to perform his or her job.

Is Obesity A Disability Under the ADA?

Contributed by Suzanne Newcomb, March 15, 2019

Page with ADA (Americans with Disabilities Act) on the table with stethoscope

As with so many ADA questions, “it depends.” However, a pair of cases pending before the 7th Circuit Federal Court of Appeals (covering Illinois, Indiana, and Wisconsin) could provide further guidance.

The 7th circuit has not definitively ruled on whether obesity alone is a “disability.” Federal appellate courts for the 2nd, 6th, and 8th circuits (covering NY, CT, and VT; KY, MI, OH, and TN; and AR, IA, MN, MO, ND, NE, and SD respectively) have all concluded obesity is not a disability unless it is linked to some other disabling condition. In the first of two pending appeals, the trial court reached the same conclusion, ruling that “severe obesity” alone is not a disability under the ADA. (Note, Michigan state law prohibits discrimination based on body weight and a handful of municipalities have passed similar measures.)

But, employers should proceed with caution. Obese employees have defeated motions for summary judgment by arguing their employers regarded them as disabled, and any adverse action taken on the basis of that perception violated the ADA. This is precisely what happened in the second case pending before the 7th circuit.

The plaintiff, who weighed 331 pounds and had a BMI of 47.5, was excluded from his position based on a policy forbidding anyone with a BMI over 40 from working in a safety sensitive role – a policy the employer argued was necessary because those with a BMI over 40 have a substantially higher risk of developing medical conditions which can cause sudden incapacitation or impairment.

The court denied summary judgment concluding it was unlawful to act on the belief that potential future disabilities pose a present safety risk. 

Best practices:

  • Remember the ADA’s statutory definition of “disability” includes those who have an impairment that substantially limits major life activities and those who are “regarded as having such an impairment.”
  • Ensure that all job qualifications – including those designed to ensure safety – are necessary and narrowly tailored to the requirements of the particular job at issue. 
  • Focus on the duties of the position. Can the applicant or employee perform the essential functions of the job safely? If not, could he with a reasonable accommodation? If the accommodation at issue is not particularly onerous, it may make sense to provide it despite uncertainty about whether the individual truly has a disability. An individual who cannot perform the essential functions of a position with or without reasonable accommodation is not a “qualified individual” and cannot sustain an action under the ADA. 
  • When in doubt, treat the individual, at least preliminarily, as if he has a disability. Don’t assume there are no medical conditions beyond excess body weight. Engage in an interactive process to determine whether the individual has a disability, and don’t take a final adverse action until the individual has had an opportunity to provide relevant facts, including evidence of a disability.

What You Don’t Know Can Hurt You: Employee Background Checks at Skilled Nursing Facilities

Contributed by guest author Adam Doerr, with Suzannah Wilson Overholt, March 13, 2019

Skilled Nursing Facilities (SNFs) are responsible for shielding residents “from abuse, neglect, misappropriation of resident property, and exploitation.” 42 C.F.R. § 483.12. This regulation implicates the employment process, since SNFs are prohibited from employing “or otherwise engag[ing]” individuals who have been “found guilty by a court of law,” had a “finding entered into the State nurse aide registry,” or had “a disciplinary action in effect against his or her professional license” as a result of “abuse, neglect, exploitation, mistreatment of residents or misappropriation of their property.” 42 C.F.R. § 483.12(a)(3)(i)-(iii). One of the most important ways that SNFs can protect residents is by properly screening and monitoring their employees.

cv review flat illustration. hand with magnifier over curriculum vitae

There are no federal requirements for how a SNF should screen its employees. However, there is a variety of agency guidance that describes what a thorough screening process should look like. According to the State Operations Manual, Appendix PP, a facility should conduct a thorough “investigation of the histories of . . . prospective staff.” Any individual hired or otherwise engaged by the facility should be screened, including “the medical director, consultants, contractors, volunteers” and students in training programs. The screening must also be thorough, including checking the State nurse aide registry and licensing authorities, contacting previous employers, attempting to identify prior criminal prosecutions, and checking the HHS Office of Inspector General’s List of Excluded Individuals/Entities (“Exclusion List”). The Exclusion List is a searchable electronic database of individuals and entities who are excluded from participation in any federal health care program, including Medicare and Medicaid, for the commission of certain crimes and violations laid out in 42 U.S.C. § 1320a-7. A SNF may not receive payment from a federal healthcare program for any items or services furnished, ordered, or prescribed by an excluded individual or entity. If a SNF does receive payment for services provided by an excluded individual or entity, the SNF could be subject to civil monetary penalties. Because the consequences of hiring an excluded individual are so severe, CMS has issued letters to each state Medicaid director reminding them to have employers check the Exclusion List monthly. Certain states, such as Indiana, have made such monthly checks mandatory.

Finally, the Office of Inspector General has also issued guidance urging healthcare providers to check the System for Award Management (“SAM”) database maintained by the General Services Administration. The SAM database includes a list of suppliers, vendors, and individuals who are excluded from receiving contracts or other financial assistance from the federal government. Thus, checking this list should be part of any screening process for prospective employees.

Conducting thorough screenings of all prospective employees is important in a SNF’s ongoing efforts to protect residents from abuse or mistreatment. Following state and federal guidance and regulations is the best way to ensure that screenings are appropriate.

DOL Announces Long-Awaited Proposed OT Rule

Contributed by Carlos Arévalo and Sara Zorich, March 11, 2019

Overtime – blue binder in the office

As a follow up to our March 4th blog, three days later the DOL announced a proposed OT rule increasing the minimum salary required for an employee to qualify for exemption from federal overtime pay requirements. The proposed increase in salary level is from $455 per week ($23,660 annually) to $679 per week ($35,308 annually). In addition, the proposed rule includes the following changes: 

  • The proposal increases the total annual compensation requirement for “highly compensated employees” from the currently-enforced level of $100,000 to $147,414 per year (note, this overtime exemption is not applicable in Illinois as it was not adopted by the Illinois Minimum Wage Law);
  • A commitment to periodic review to update the salary threshold, but not an automatic adjustment as was the case with the 2016 proposed rule. Updates would continue to require notice-and-comment rulemaking;
  • A special salary level for Puerto Rico, the Virgin Islands, Guam, and the Commonwealth of the Northern Mariana Islands, a separate special salary level for American Samoa and an updated special weekly “base rate” for the motion picture producing industry; and
  • Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid annually or more frequently to satisfy up to 10 percent of the standard salary level, which was also part of the 2016 proposed rule. (Note, the proposed rule would allow a one-time yearly catch up payment if the employee does not earn the anticipated bonuses. The proposed rule states that as long as an employer pays 90% of the standard level ($611.10) and if at the end of the 52-week period the salary paid plus the nondiscretionary bonuses and incentive payments (including commissions) paid does not equal the standard salary level for 52 weeks ($35,308), the employer would have one pay period to make up for the shortfall (up to 10 percent of the standard salary level, $3,530.80).) 

There were no changes to overtime protections for police officers, firefighters, paramedics or nurses. There were also no changes impacting laborers including non-management production-line or non-management employees in maintenance, construction and related occupations.   

Most notably, the proposed rule stayed away from any changes to the job duties test.  We anticipate legal challenges to the proposed rule may be lodged by both the business community and employee rights groups as this rulemaking is a significant change from the current law and a deviation from the 2016 proposed rule.  Employers will have 60 days to submit comments to the DOL. Once the comments are considered, the DOL will issue and publish a final rule. In light of the proposed rule, we encourage employers to begin examining how it might impact them. This includes review of applicable state law as employers are required to comply with whichever law is most favorable to employees. We will be available to address any concerns or questions you may have.  And as always, we will keep an eye on any other developments and will keep you updated.