On July 17, 2017, the Illinois Appellate Court, First District, held that punitive damages are recoverable under Illinois law in the employment law claim for negligent hiring, supervision or retention of a dangerous employee, even if the employer lacked actual knowledge of the employee's dangerous propensity. John Doe v. The Catholic Bishop of Chicago, et al., 2017 IL App (1st) 162388 (First Dist. 7/17/2017). The plaintiff in this case filed a negligent employment claim against the defendant, in which he alleged that a former priest sexually molested him while he attended a school that employed the priest. He claimed punitive damages. On appeal, the First District considered the question of whether a claim for punitive damages requires proof of an employer's conscious disregard for an employee's particular unfitness, where the underlying claim is for negligent hiring, supervision and retention of that employee.
On May 23, 2017, the Illinois Appellate Court, First District, held that the non-renewal of an independent contractor's employment contract with the State of Illinois constitutes adverse job action for purposes of a retaliatory discharge claim under the State Ethics Act. Wynn v. Illinois Department of Human Services, 2017 IL App (1st) 160344 (May 23, 2017). In this case, a contract employee alleged that the state violated the Illinois Ethics Act by intentionally not renewing his independent contractor employment agreement in retaliation for his protected activity of reporting an alleged improper, unauthorized state expenditure to an auditor. After a one-day bench trial, the plaintiff was awarded $782,253.
On March 24, 2017, the 7th Circuit reversed the dismissal of a complaint which alleges that employers jointly employed, as a supervisor, an employee with a known history of sexually harassing, verbally abusing, and physically intimidating his young female subordinates; and that they failed to take reasonable steps in response to multiple complaints of sexual harassment against him as well as other misconduct known to more senior managers. Anicich v. Home Depot U.S.A., Inc., et al., No. 16-1693 (7th Cir. 3/24/2017). In this decision, the 7th Circuit clarifies and explains the scope of Illinois employers' tort liability for intentional torts committed by their supervisors against other employees, where the employer has been negligent. Illinois law permits recovery from employers whose negligent hiring, supervision, or retention of their employees causes injury.
On March 13, 2017, the 7th Circuit affirmed a jury verdict in favor of an employer in a lawsuit in which an employee alleged that the employer breached and waived its right to terminate an employment agreement that was terminable only for cause. Burford v. Accounting Practice Sales, Inc., et al., No. 16-1871 (7th Cir. 3/13/2017). This case involved an employment contract that provided the employee with an exclusive sales territory. The employment agreement stated that the employer could not terminate the contract unless it was violated by the employee. Based on this language, the contract was not terminable "at will," but only terminable for cause. The contract gave the employer the option to terminate the agreement if the employee failed to meet his sales goals.
On February 24, 2017, the Illinois Appellate Court, First District, reversed an order of summary judgment in favor of a defendant employer in a lawsuit for breach of an employment agreement. Rosenberger v. United Community Bancshares, Inc., 2017 IL App (1st) 161102 (2/24/2017). This case involved an executive employment contract that provided the executive, a Chief Lending Officer, with a 3-year term of employment. The contract contained a severance compensation provision, which stated that if the company terminated the executive's employment prior to the expiration of his employment term for any reason other than cause, the executive would be entitled to a lump-sum severance payment equal to two times his annual base salary then if effect.
Effective July 1, 2017, employers of any size with a place of business within Cook County, Illinois will be required to provide paid sick leave to their covered employees under the new Cook County Earned Sick Leave Ordinance. A covered employee is defined as any employee who, in any particular two-week period, performs at least two hours of work for an employer while physically present within Cook County. Any covered employee who works at least 80 hours for an employer within any 120-day period is eligible to accrue one hour of earned sick leave for every 40 hours worked, up to a cap of 40 hours' earned sick leave per 12-month period. An employee may carry over to the following 12-month period half of his or her unused accrued earned sick leave, up to a maximum of 20 hours. A covered employee is entitled to use no more than 40 hours of earned sick leave per 12-month period.
On December 22, 2016, the 7th Circuit affirmed the district court's order granting summary judgment to the defendant on a claim under Illinois law that it violated the covenant of good faith and fair dealing by failing to pay the plaintiff his bonuses under his employment contract. Wilson v. Career Education Corporation, No. 16-1063 (7th Cir. 12/22/2016). The plaintiff alleged that the defendant owed him the payment of bonuses under an incentive compensation provision in his employment agreement. He alleged that the defendant violated the implied covenant of good faith and fair dealing, which is implied in all contracts under Illinois law. The bonus plan explicitly reserved to the company the right to terminate or amend the plan at any time for any reason at its sole discretion. However, this type of discretionary provision in a bonus plan is still subject to the covenant of good faith and fair dealing and, therefore, does not provide a company with absolute unfettered discretion to terminate an employee's bonus payments.
On December 20, 2016, the Illinois Appellate Court, First District, reversed an order of the trial court that had dismissed an employee's claims for breach of an employment agreement and promissory estoppel. Boswell v. City of Chicago, 2016 IL App (1st) 150871 (12/20/2016). Promissory estoppel is an employment law claim that is not dependent upon the existence of an employment contract. To state a claim for promissory estoppel, a employee must allege: (1) the employer made an unambiguous promise; (2) he relied on the promise; (3) his reliance was expected and foreseeable; and (4) he relied on the promise to his detriment. In this case, the employee alleged that the employer made representations that his employment would include certain terms and conditions, upon which he reasonably relied to his detriment by resigning from his previous employment and relocating his family to Chicago.
Here is a look back at 2016 7th Circuit employment law decisions, including significant trends and changes in employment law in the 7th Circuit, as well as a tally of decisions affirming and reversing summary judgments in employment law cases. Notably, in 2016, the 7th Circuit affirmed orders of summary judgment in 22 employment law cases, but reversed orders of summary judgment in only 5 employment law cases (10 calendar days remain, so the numbers may change). But as of this date the ratio is 4.4/1, i.e., 4.4 summary judgments were affirmed for every 1 summary judgment that was reversed. Put another way, of the 27 employment law summary judgments on appeal to the 7th Circuit in 2016, 81.5% were affirmed, while 18.5% were reversed. The 27 cases include employment discrimination, harassment, failure-to-accommodate, and retaliation claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Family and Medical Leave Act, the Rehabilitation Act, Section 1981, the Illinois Human Rights Act, and Illinois common law.
In 2016, several new Illinois employment law statutes as well as a City of Chicago Ordinance were enacted, many of which expand employee leave of absence rights. Here is a summary of the new Illinois and Chicago employment laws.
Illinois Employee Sick Leave Act:
Illinois employers who provide paid sick leave must allow employees to use their paid sick leave time to care care for their immediate family members, parents-in-law, grandchildren or grandparents.
Illinois Child Bereavement Leave Act: