As the nation only is contemplating recovery from the COVID-19 pandemic, and as a new Democratic administration takes the helm at the White House, employers in Illinois and across the U.S. should be prepared for an increase in both aggressive workers’ rights enforcement, and the lawsuits that also piggyback on such regulatory actions, according to a prominent law firm’s annual litigation report.
And Chicago’s courts figure to be near the fore of much of that litigation push.
Earlier this month, the firm of Seyfarth Shaw in Chicago released its annual Workplace Litigation Report. The report takes a look back at the trends and data that shaped class action and lawsuit activity across the country, and takes a look ahead at the year to come.
“As the workplace class action litigation landscape has expanded, the risks have grown exponentially, and the defense of class action litigation has transformed,” the Seyfarth Shaw report said. “In this unique year of COVID-19, this trend has accelerated.
“… The events of the past year demonstrate that the array of problems facing businesses are continuing to evolve and become more complex. The COVID-19 pandemic created new challenges and new laws, which led to new types of workplace issues, new remote-work challenges, and new class theories that are likely to become part of the fabric of complex workplace litigation for years to come.”
The report identified key trends shaping workplace-related litigation in 2020. These were led by the onset of the COVID-19 pandemic, which, when combined with often strict state government responses to the virus, led to shuttered and limited workplaces and economic misery in many parts of the country.
The impact of the pandemic extended to the nation’s courts, as well, the report noted, as even court system shutdowns and the suspension of in-person proceedings did not slow plaintiffs’ lawyers from filing lawsuits, including class actions.
Lawsuits related to COVID-19, for instance, accused employers of discrimination in layoffs; failure to pay minimum wage or overtime; failure to reimburse employee expenses; failure to follow local and state workplace scheduling or paid time off laws; and failure to adequately protect their employees from exposure to COVID-19.
The response from courts to such claims were mixed – a “patchwork quilt” of rulings, the report said – breeding uncertainty that will lead to more legal claims, as personal injury lawyers and others seek to find their openings under the law.
“Employers are apt to see these workplace class actions expand and morph as businesses restart operations in the wake of COVID-19,” the report said.
Apart from COVID-19, however, employers should also expect more workplace-related litigation in the new year, as plaintiffs’ lawyers seek to build on their success in 2020.
For instance, the report noted that even with courts often shuttered or, at best, dramatically slowed, plaintiffs’ lawyers still reaped the highest total settlements for workplace lawsuits in years.
In 2020, the report said, workplace litigation resulted in aggregate settlements of $1.58 billion, up 18% from 2019. It was the highest total since 2017, when Seyfarth Shaw reported aggregate settlements of $2.75 billion.
The report noted several Illinois settlements ranked among the most expensive in the country, including:
- $14 million paid by Cook County to settle a class action brought by female public defenders and law clerks who claimed the Cook County Sheriff’s Office didn’t do enough to prevent them from being sexually harassed by inmates at the County Jail;
- $25 million from human resources services provider ADP for allegedly violating the Illinois Biometric Information Privacy Act. The class action accused ADP of failing to abide by the technical notice and consent provisions of the BIPA law before supporting employers who installed so-called biometric timeclocks that required workers to scan fingerprints when punching in and out of work shifts;
- $4.1 million from timeclock and software developer NovaTime Technology. Like ADP, NovaTime was accused of violations of the BIPA law over worker fingerprint scans; and
- $3.2 million from the owners of the Corner Bakery restaurant chain, also allegedly for violating the Illinois BIPA law over worker fingerprint scans.
Class certification is a legal step in which judges agree to allow cases to proceed as class actions, rather than individual lawsuits.
“After gathering and analyzing 17 years of nationwide data on class actions, the results on the success rate of the plaintiffs’ bar in turning lawsuit filings into certified cases that then settled was remarkable,” said Gerald Maatman, an attorney at Seyfarth Shaw and the report’s lead author.
“The certification rate of 84% in the wage & hour class/collective action area shattered previous levels of success by the plaintiffs’ bar.”
The Seyfarth report, however, said employers should expect such wage & hour class actions to “explode” in 2021 and beyond.
In Illinois, Seyfarth predicted still more class actions aimed at employers under the BIPA law, building on the “onslaught” of hundreds filed in the state since 2015, primarily in Cook County Circuit Court.
They said employers in other states could also face similar actions under different state laws.
Plaintiffs’ lawyers efforts are expected to receive a boost, as well, as the federal Department of Labor under incoming Democratic President-elect Joe Biden is expected to make “wage theft its enforcement priority,” the report said.
And Biden-led federal agencies will likely engage in “new worker-friendly rulemaking,” the Seyfarth report predicted.
Private litigation often quickly follows government enforcement actions, using official reports and filings as the basis for their own lawsuits and legal claims.
Employers should also expect increased scrutiny by the federal government and in court under claims of religious and racial discrimination, the Seyfarth report predicted. It noted the Equal Employment Opportunity Commission has made religious discrimination and national origin discrimination some of its top priorities in recent years.
The federal agency has published new guidance on religious guidance, and has noted that “perceived national origin discrimination” could be treated the same as actual national origin discrimination claims.
The report said the increased federal scrutiny, coupled with creative lawsuit theories and strategies from plaintiffs’ lawyers, will present a host of new or heightened challenges for employers in Illinois and nationwide in coming years.
“This confirms the importance for corporations in 2021 of robust investments in legal compliance – especially in the manner in which workers are paid and compensated – is the necessary first line of defense to costly class action litigation,” Maatman said.