NLRB Weighs in on Employers’ Right to Monitor Workplace Communications

E. Jason TremblayE. Jason Tremblay

It has traditionally been understood and recognized that employees do not have an expectation of privacy when using their employer’s computer system and that employers can monitor and control their employees’ emails. However, in light of a recent decision by the National Labor Relations Board (“NLRB”) in Purple Communications, Inc., 361 NLRB 126 (2014), employers may need to rethink this commonly held belief.

In Purple Communications, the NLRB overruled long-established precedent that employees have no statutory right to use their employer’s email system for Section 7 purposes and held instead that employee use of email for statutorily protected communications on nonworking time must be presumptively permitted by employers that give employees access to their email systems.

Section 7 of the National Labor Relations Act (“NLRA”) gives employees the right to form, join or assist unions and to engage in other concerted activities. By way of example, Section 7 protects employees that, among other things, criticize a company’s policies and procedures, its management, or other terms and conditions of their employment.

The Purple Communications’ case arose in the aftermath of a union organizing campaign. Specifically, like many companies throughout the country, the company in Purple Communications had a policy requiring that email, as well as other communication tools provided by the company, “be used for business purposes only.” The policy also prohibited employees from using company email to “engag[e] in activities on behalf of organizations or persons with no professional affiliation or business with the company.” In short, employees could not use the company email systems for any non-business related activities, which arguably included protected Section 7 activity. Certainly, in light of the prior precedent, the company in Purple Communications had good reason to believe that its policies complied with the law.

In overruling such well-established precedent, however, the NLRB effectively held that an employee’s use of email for statutorily protected communications on non-working time must presumptively be permitted by employers who have chosen to give employees access to their email systems. Put another way, once an employer gives an employee access to its email system for business purposes, it must allow that employee to use that system to communicate about Section 7 activities as well.

As you can imagine, this recent decision could have a significant impact on an employer’s ability to track, monitor and/or use employee electronic communications. For example, it has generally been accepted that employers have the right to control and/or monitor their employee’s emails sent and received through the company computer systems. But now, under Purple Communications, any such monitoring and/or control may constitute an unlawful surveillance of Section 7 protected concerted activities under the NLRA and could subject an employer to liability for unfair labor practice. Similarly, this decision may very well impact an employer’s right to discipline employees for statements they may make about their co-workers, supervisors or the company through electronic communications.

In light of this novel holding, every employer subject to the NLRA (which includes virtually all employers, union and non-union) should review their policies regarding non-business use of company electronic mail and determine whether these policies comply with the principles set forth in Purple Communications. Although this case is still likely to be challenged in court, which may result in its reversal, it is absolutely clear that, by this decision, the NLRB is attempting to establish an additional avenue through which unions may organize workplaces.

Should you have any questions, please do not hesitate to contact E. Jason Tremblay or your Arnstein & Lehr LLP labor and employment attorney.

Limitations Period For Bringing Discrimination and Retaliation Claims May Be Contractually Shortened

E. Jason TremblayE. Jason Tremblay

A recent case from the Northern District of Illinois, Lugihibl v. Fifth Third Bank (Case No. 13 CV 7193, March 16, 2015, Kennelly, M.), held that Title VII and ADEA limitations periods can be contractually shortened under certain circumstances, despite the general 300-day limitations to bring such claims in Illinois.

In Lugihibl, a bank employee brought sex and age discrimination and retaliation claims against his employer after he was discharged. While the discharged employee filed his EEOC charge within the 300-day period allowed in Illinois, he filed it after the six-month (or 180-day) period that he contractually agreed to in his incentive compensation agreement for bringing such claims. Specifically, the incentive compensation agreement stated that the employee would not commence an employment-related action “[m]ore than six months after the termination of Employee’s employment, if the action or suit is related to the termination of Employee’s employment,” or “[m]ore than six months after the event or occurrence on which Employee’s claim is based, if the action or suit is based on an event or occurrence other than the termination of Employee’s employment.” The discharged employee also contractually agreed to waive any statute of limitations periods that were contrary to this position.

The bank asserted that it had discharged the employee for a host of legitimate, non-discriminatory reasons and, further, that his EEOC charge of discrimination was untimely in any event since it was filed after the shortened six-month period for bringing such claims. After the employee filed suit in federal court, the bank filed a motion for summary judgment asserting, among other things, that the employee’s discrimination and retaliation claims were time barred by the incentive compensation agreement.

In holding for the bank, the Court expressly held that the relevant contract containing the reduced limitations period was unambiguous, supported by adequate consideration and that the provision was supported by existing law. In reaching this holding, the Court relied on several cases, including the Seventh Circuit in Doe v. Blue Cross Blue Shield United of Wisconsin, 112 F.3d 869 (7th Cir. 1997), and the dominant view in contract law that contractual limitations periods shorter than statute of limitations are permissible, provided they are reasonable. Here, the Court held that there was nothing unreasonable about the six-month time period contained in the contract because the default period for filing an EEOC charge is actually 180 days (or six months). Importantly, the Court’s holding in this case is specifically limited to contractually shortening the limitation period for filing EEOC charges and the Court recognized that an employer cannot contractually limit the time period in which an employee can file a lawsuit in federal court.

In light of the Court’s ruling in Lugihibl, employers should strongly consider whether it makes sense to incorporate a shorter limitations period for filing EEOC charges in employment agreements or other agreements, as it may later be useful in the event an existing or discharged employee decides to file an EEOC charge long after the allegedly discriminatory or retaliatory conduct occurs.

Should you have any questions regarding the Lugihibl case or if you would like to update your existing employment or other agreements, please contact E. Jason Tremblay or your Arnstein & Lehr LLP attorney.

Cook County Enacts Wage Theft Ordinance with Serious Consequences for Employers

Megan Toth

Arnstein & Lehr Attorney Megan TothCook County recently became the largest county in the nation to pass a “wage theft” ordinance that will have significant consequences for employers that are located in, contract with, or do business in Cook County. Effective May 1, 2015, qualifying employers found in violation of any state or federal wage-payment laws within the past five years may face business license denial or revocation, be denied or lose existing contracts with Cook County, and face enormous property tax liability.

Under the Cook County Wage Theft Ordinance, any employer who, within the prior five-year period, has admitted or has been adjudicated liable in any judicial or administrative proceeding of committing a repeated or willful violation of federal or state wage payment laws will be ineligible to enter into a County contract, respond to a request for proposal from the County, or submit a bid to the County. The County may also issue a notice of default under existing contracts entered into after the effective date of the ordinance if it learns that an employer has violated wage payment laws within the last five years. Finally, unless expressly waived by the County, any employer who has been found liable for a repeated or willful violation of state or federal wage payment laws within the prior five years will be ineligible for certain tax incentives.

In addition to its obvious penal implications, the Wage Theft Ordinance also imposes new obligations on employers seeking to contract with the County, requesting tax incentives from the County, or applying for a general business license from the County after the effective date of the Ordinance. Any such employers now must attest, under oath that they have not been found to have willfully or repeatedly violated federal or state wage and hour laws, either by a court or an administrative agency, with the prior five-year period.

In light of the expansiveness of the ordinance and its serious consequences, employers should evaluate their wage and hour practices, both past and future, with a greater sense of caution and conservatism. Employers need to determine whether they have been found liable for wage and hour violations in the past before submitting any of the required affidavits to the County and should seek a waiver or exception from the County when applicable. Employers who are aware of potential wage and hour claims, or are currently facing such claims, should immediately seek counsel to address their potential exposure under the Wage Theft Ordinance. As with any new legislation, however, only time will tell how the Cook County Wage Theft Ordinance will be enforced and whether it will survive the inevitable legal challenges.

Should you have any questions regarding the Cook County Wage Theft Ordinance, please contact Megan P. Toth at 312-876-7812 or mptoth@arnstein.com, or your regular Arnstein & Lehr LLP attorney.

Chicago to Raise Its Minimum Wage

TremblayJason_web

Jason Tremblay

E. Jason Tremblay

On December 2, 2014, the Chicago City Council followed several other municipalities around the country and approved an ordinance to raise the minimum wage. Effective July 1, 2015, Chicago employers of all sizes will be required to pay a minimum hourly wage of $10.00 (from its current $8.25 per hour) with successive increases to $13.00 per hour by July 1, 2019. Specifically, the minimum wage increases will be as follows:

$10.00/hour by July 1, 2015
$10.50/hour by July 1, 2016
$11.00/hour by July 1, 2017
$12.00/hour by July 1, 2018
$13.00/hour by July 1, 2019

Thereafter, beginning on July 1, 2020, the minimum wage in Chicago will increase on an annual basis indexed to the rate of inflation (as measured by the Consumer Price Index). However, there will be no increases if the unemployment rate in Chicago is 8.5% or higher in the preceding year, and any increases will be capped at 2.5% regardless of the inflation rate.

The Chicago ordinance also impacts employers with tipped employees, such as bars and restaurants. Under federal and state wage laws, Illinois employers can take a “tip credit” and pay tipped employees an hourly wage as low as $4.95, provided that the employees make at least minimum wage with their tips. By July 1, 2015, however, Chicago employers with tipped employees must pay $5.45/hour and $5.95/hour by July 1, 2016. And, beginning on July 1, 2017, the minimum hourly wage for tipped employees will be indexed to inflation using the same measure as regular wages discussed above.

Should you have any questions regarding this ordinance, please contact Arnstein & Lehr LLP.

Ban the Box Law Will Soon Apply to Virtually All Chicago Employers

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Jason Tremblay

E. Jason Tremblay

On November 5, 2014, the Chicago City Council approved an ordinance that effectively makes the recently-passed Illinois’ Job Opportunities for Qualified Applicants Act (commonly known as the Ban the Box Law) apply to all Chicago employers. The Illinois Ban the Box Law does not apply to employers with less than 15 employees, but there is no such exclusion in the Chicago ordinance. The purpose of the ordinance is to remove employment barriers for applicants in Chicago with prior arrest or criminal records.

The Chicago ordinance prohibits all Chicago employers to inquire about or into, consider, or require disclosure of an applicant’s criminal record or criminal history until after the applicant has been determined qualified for the relevant position and notified that the applicant has been selected for an interview. If there is no interview, then the employer is prohibited from inquiring into the applicant’s criminal record or history until a conditional offer of employment has been extended. The only exceptions to this prohibition are for positions where federal or state law excludes applicants with certain criminal convictions, positions where a standard fidelity or equivalent bond is required (and specified criminal offenses would disqualify the applicant) and positions that require a license under the Emergency Medical Services Systems Act.

The new Chicago ordinance goes even further than the Illinois Ban the Box Law in that, once a criminal background search is conducted, employers must take into account a series of factors before disqualifying an applicant for consideration for a position, such as the nature of the applicant’s specific criminal offense, when the offense took place, the severity of the offense and the relationship between the offense and the nature of the position being sought by the applicant.

Additionally, in the event that a Chicago employer makes the decision not to hire an applicant based, entirely or in part, on the applicant’s criminal record or history, the employer is required to inform the applicant of the specific basis for not being hired.

The Chicago Ban the Box ordinance, like its state counterpart, becomes effective for private employers on January 1, 2015. However, it became applicable to the City of Chicago and all of its “sister” agencies on November 5, 2014.

Ban The Box Law Will Soon Apply to Small Chicago Employers

TremblayJason_web

Jason Tremblay

E. Jason Tremblay

On November 5, 2014, the Chicago City Council approved an ordinance that effectively makes the recently-passed Illinois’ Job Opportunities for Qualified Applicants Act (commonly known as the Ban the Box Law) apply to Chicago employers with fewer than 15 employees. The purpose of the ordinance is to remove employment barriers for applicants in Chicago with prior arrest or criminal records.

The Chicago ordinance prohibits Chicago employers with fewer than 15 employees to inquire about or into, consider, or require disclosure of an applicant’s criminal record or criminal history until after the applicant has been determined qualified for the relevant position and notified that the applicant has been selected for an interview. If there is no interview, then the employer is prohibited from inquiring into the applicant’s criminal record or history until a conditional offer of employment has been extended. The only exceptions to this prohibition are for positions where federal or state law excludes applicants with certain criminal convictions, positions where a standard fidelity or equivalent bond is required (and specified criminal offenses would disqualify the applicant) and positions that require a license under the Emergency Medical Services Systems Act.

The new Chicago ordinance goes even further than the Illinois Ban the Box Law in that, once a criminal background search is conducted, employers must take into account a series of factors before disqualifying an applicant for consideration for a position, such as the nature of the applicant’s specific criminal offense, when the offense took place, the severity of the offense and the relationship between the offense and the nature of the position being sought by the applicant.

Additionally, in the event that a Chicago employer makes the decision not to hire an applicant based, entirely or in part, on the applicant’s criminal record or history, the employer is required to inform the applicant of the specific basis for not being hired.

The Chicago Ban the Box ordinance, like its state counterpart, becomes effective for private employers on January 1, 2015. However, it became applicable to the City of Chicago and all of its “sister” agencies on November 5, 2014.

Jason Tremblay presents The Regulatory and Legal Challenges Facing HR Experts

Chicago Partner Jason Tremblay presented “The Regulatory and Legal Challenges Facing HR Experts,” during a live session hosted by the National Association of Real Estate Investment Managers on Thursday, August 7 in Chicago.

Jason Tremblay presents Is Your Noncompete Enforceable? Tips and Traps in Drafting and Enforcing Noncompete Agreements

Chicago Partner Jason Tremblay presented “Is Your Noncompete Enforceable? Tips and Traps in Drafting and Enforcing Noncompete Agreements,” during a live webinar hosted by the American Bar Association on Tuesday, July 29. During this presentation, Mr. Tremblay discussed key considerations in drafting and enforcing noncompete agreements.

Jason Tremblay presents Is Your Noncompete Enforceable? Tips and Traps in Drafting and Enforcing Noncompete Agreements

Chicago Partner Jason Tremblay presented “Is Your Noncompete Enforceable? Tips and Traps in Drafting and Enforcing Noncompete Agreements,” during a live webinar hosted by the American Bar Association on Tuesday, July 29. During this presentation, Mr. Tremblay discussed key considerations in drafting and enforcing noncompete agreements.

Thomas Conley and Norman Jeddeloh author physician employment guide for AMA

Chicago Partners Thomas Conley and Norman Jeddeloh recently co-authored the “Annotated Model Physician-Group Practice Employment Agreement” for the American Medical Association. This book is a valuable resource for physicians, group practice owners and professional advisors who want to be prepared to negotiate employment agreements.

To learn more about this publication, click here.