Employer Alert: New NLRB decision and amended Illinois statutes require review of employer practices and policies.

September 8, 2023

New NLRB decision impacts employee policies and agreements

The August 2 decision from the NLRB, Stericycle, Inc., 372 NLRB No. 113 (2023), may have a significant impact on how private employers (whether unionized or not) draft workplace rules and employee policies and agreements. The opinion rejects a series of earlier NLRB decisions that it determines allowed employers to adopt “over broad work rules that chill employees’ exercise of their rights under Section 7 of the [NLRA], which include the ‘right to self-organization, to form, join or assist labor organizations, to bargain collectively . . . and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.’”

The new standard is that workplace rules should be evaluated from the perspective of an “economically dependent” employee who is anxious to avoid discharge or discipline. Under the new guidelines, no category of rules qualifies as “always lawful.” Instead, a case-by-case approach is required, with a particularized analysis of specific rules, their language, and the employer’s legitimate business interests in invoking them. If an employee could reasonably interpret a rule to have a coercive meaning, the rule is presumptively unlawful, and will only be determined to be lawful if the employer can prove the rule advances a “legitimate and substantial business interest that could not be advanced with a narrower rule.” The intent of the rule is immaterial. Any ambiguity in a work rule will be construed against the employer as the drafter of the rule.

While this opinion will likely be appealed, it is currently law and takes effect immediately. Among the work rules and policies employers should evaluate in the aftermath of Stericyle are the following:

• Personal electronics policies (including use of phones and/or cameras in the workplace)
• Social media policies
• Non-disparagement clauses
• Confidentiality of investigation policies
• Electronic communication policies
• Personal conduct rules, including insubordination
• Conflicts of interest policies

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Illinois Joins Recent Trend and Enacts Pay Transparency Law 

On August 11, 2023, Governor J. B. Pritzker signed House Bill 3129, which amends the Illinois Equal Pay Act to require employers with 15 or more employees to provide wage and salary information in connection with any job postings (the “Pay Transparency Amendment”). The Illinois Equal Pay Act was previously amended to require Illinois employers with 100 or more employees to obtain an equal pay registration certificate no later than March 23, 2024.

The new Amendment goes into effect January 1, 2025, and the key provisions are as follows:

• Job Posting Requirements — Employers with 15 or more employees must include “pay scale and benefits” information in any job posting for positions that (1) will be physically performed, at least in part, in Illinois or (2) will be physically performed outside of Illinois, but the employee reports to a supervisor, office, or other work site in Illinois.

• • “Pay scale and benefits” includes a specific salary or wage or a good-faith range, and a general description of the benefits and other compensation, such as bonuses, stock options, or other possible incentives the employer reasonably expects to offer.

• • A web link to a page with publicly viewable pay scale and a description of benefits satisfies the employer’s obligation to provide information.

• • Third-party recruiters, employment agencies, and job-listing websites are also required to post pay scale and benefits and will be liable for failure to include required information unless they can show that the employer failed to provide the information.

• • Employers shall announce, post, or otherwise make known all opportunities for promotion to all current employees no later than 14 calendar days after the employer makes an external job posting.

• Disclosure to Applicants — Employers are not required to make a job posting. However, if no such posting with the required information has been made, the employer or employment agency is required to disclose to any applicants the pay scale and benefits to be offered for the position prior to any offer or discussion of compensation and/or upon the applicant’s request.

• • Nothing in the Pay Transparency Amendment prohibits an employer or employment agency from asking an applicant about his or her wage or salary expectations. 

• Retaliation Prohibited — Employers and employment agencies shall not refuse to interview, hire, promote, or employ or otherwise retaliate against an applicant for employment or an employee for exercising his or her rights under the Pay Transparency Amendment.

• Record-Keeping Required — Employers must make and preserve records relating to the pay scale and benefits for each position and the job posting for a minimum of 5 years or until authorized by the Illinois Department of Labor or court order in the event of an investigation.

• Investigations and Penalties — The Illinois Department of Labor is authorized to investigate non-compliance and issue monetary penalties for violations.

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Illinois Enacts New Rights and Safety Protections for Temporary Workers

On August 4, 2023, Governor Pritzker signed HB 2862, amending the Illinois Day and Labor Services Act to provide temporary workers with rights to equal pay and benefits and additional training and safety protections. The amended law also expands who can file suit under the Act to include “interested parties” and increases statutory penalties as well as the likelihood that a staffing agency’s registration may be revoked. The law goes into effect immediately, and the most significant changes are set forth below:

• Right to Equal Pay and Benefits — Temporary workers assigned to work more than 90 calendar days for a third-party client shall be paid not less than the rate of pay and equivalent benefits as the lowest-paid comparable employee directly hired by the third-party client.

• • If no comparable employee exists, the temporary worker shall be paid no less than the lowest-paid direct hire employee of the third-party client with closest level of seniority.
  • The staffing agency may pay the temporary worker the hourly cash equivalent of the actual cost of benefits in lieu of providing benefits.
  • Third-party clients are required to provide staffing agencies with information related to job duties, pay, and benefits or risk a “notice violation” subject to a fine of $500 per violation plus attorneys’ fees.

• Workplace Safety and Training — In addition to existing safety standards, the new law requires the following before each new temporary worker assignment:

• • Duties of Staffing Agency: Staffing agencies must: (1) inquire about and assess the safety conditions, workers tasks, and client company’s safety program; (2) provide general awareness safety training for recognized industry hazards the temporary worker may encounter at the client’s worksite; (3) transmit a description of training program to the client; (4) provide temporary workers with the Illinois Department of Labor’s hotline number for reporting safety hazards; and (5) inform temporary workers of the individual to whom they should report safety concerns at the client company worksite. The staffing agency must maintain records documenting all of the foregoing requirements.

• • Duties of Client Company: The Client Company must: (1) inform the staffing agency of any job hazards likely to be encountered by the temporary worker; (2) review the training provided by the staffing agency to determine if it addresses recognized hazards for the client’s industry; (3) provide specific training tailored to the particular hazards of the client company’s worksite; and (4) document and maintain records of site-specific training, provide confirmation of training to staffing agency, and allow staffing agency to visit any worksite. Changes in job tasks or work location, with new potential hazards, require additional notification and training.

• Right to Refuse Assignment to a Labor Dispute — Temporary workers must be given advance written notice: (1) informing them of any strike, lockout, or other labor dispute that exists; and (2) of their right to refuse the assignment without prejudice to receiving another assignment.

• Increased Enforcement and Penalties — The amendments also include provisions that increase statutory penalties when staffing agencies and/or third-party clients violate any provision of the Act, increase the ability of “interested parties” (defined as “an organization that monitors or is attentive to compliance with public or worker safety laws, wage and hour requirements, or other statutory requirements”) to file claims under the Act, and increase the likelihood of a loss of registration by staffing agencies that are out of compliance with the law.

 

For further information, contact your Croke Fairchild lawyer or: