Time’s Up for Sexual Harassment in the Restaurant Industry

The Time’s Up Legal Defense Fund (Defense Fund), known for providing legal assistance to victims of sexual misconduct, recently started targeting McDonald’s restaurants to pursue sexual harassment claims. On May 21, 2019, the Defense Fund, the American Civil Liberties Union, and the fast-food workers coalition Fight for $15mcdonalds-904054_640 announced the filing of 25 new sexual harassment and gender discrimination cases against McDonald’s restaurants.

These new complaints come on the heels of ten harassment and discrimination charges filed against McDonald’s restaurants with the Equal Employment Opportunity Commission (EEOC) in May 2018, and a September 2018 strike where thousands of McDonald’s workers in 10 cities protested the company’s “widespread” misconduct. The Defense Fund states in a letter to top McDonald’s executives that the company failed to adequately address sexual harassment claims filed with the EEOC one year ago.

Of the 25 new cases, 20 were filed with the EEOC, three were filed as civil rights law suits, and two suits stemmed from previous allegations. Current and former McDonald’s workers argue that these allegations include gender-based discrimination, sexual harassment in the workplace, and retaliation for reporting incidents of harassment.

McDonald’s workers are calling for McDonald’s to provide employees better protection against sexual assault and harassment in the workplace by providing comprehensive training for employees and managers, guaranteeing fair and effective processes to report harassment, as well as ensuring employees do not face retaliation for reporting misconduct. These claims are not unique to McDonald’s, however, as workers in the restaurant industry are exposed to sexual harassment at a higher rate than workers in other industries.

The chief executive of McDonald’s, Steve Easterbrook, addressed these concerns in a letter to Senator Tammy Duckworth (D-IL) on Monday, May 20th. He said that the chain has been working with the anti-sexual violence organization, RAINN, to update and improve its policies on harassment by making better efforts to inform employees of their rights, providing training to restaurant owners and general managers and in the next few months will provide harassment training for crew members and launch a reporting hotline. Illinois politicians seem to be wary of relying upon restaurant owners to establish adequate anti-harassment policies, as they proposed a law to require anti-harassment training take place in restaurants. That law, the Restaurant Anti-Harassment Act, is currently under review in the House Rules Committee and is expected to be effective on January 1, 2020.

Although the Defense Fund is currently targeting McDonald’s restaurants exclusively, its focus could soon change to other franchised restaurants, and the restaurant industry as a whole could experience more harassment-related claims as a result of the Defense Fund’s work.

As a restaurant or franchise owner, it is important to ensure that the directors and managers of your company know how to handle sexual harassment complaints and that your employee handbook has clear policies outlining your procedures for how to address workplace sexual harassment. If you have any questions about your sexual harassment policy or how to address employee allegations of sexual harassment in the workplace, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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#MeToo: Proposed Illinois Law Would Require Restaurant Employee Anti-Harassment Training

On Februarjason-leung-537357-unsplashy 15, 2019, Representative Ann M. Williams (D) introduced House Bill 3351, the Restaurant Anti-Harassment Act (the “Bill”). If it is enacted, the Bill would require all restaurants operating in Illinois to have a written sexual harassment training policy and provide anti-harassment training to all employees. The Bill is currently under review in the House Rules Committee and is expected to be effective on January 1, 2020.

The Bill would require that every restaurant have a written sexual harassment policy that:

  • Prohibits sexual harassment;
  • Defines sexual harassment under applicable state and federal law;
  • Provides examples of conduct that would constitute sexual harassment;
  • Explains the internal complaint process available to the employee;
  • Details the complaint process and legal remedies available through the Department of Human Rights;
  • Prohibits retaliation for reporting sexual harassment allegations; and
  • Requires that all employees participate in sexual harassment training.

Under the Bill, all restaurants would be required to provide mandatory sexual harassment training to employees, covering at least the following topics:

  • The definition of sexual harassment and the forms it takes;
  • An explanation about the harmful impact sexual harassment can have on victims, businesses, and those who harass;
  • How to recognize appropriate and inappropriate workplace conduct; and
  • An explanation of when and how to report sexual harassment.

In addition to the topics above, the Bill would require that training for supervisors and managers also:

  • Details employer and manager responsibility in reporting and addressing sexual harassment;
  • Provides instruction on how to create a harassment-free culture in the workplace; and
  • Explains how to investigate sexual harassment claims in the workplace.

The Bill instructs that the sexual harassment training must be specific to the restaurant or hospitality industry, and must include food-service related activities, images, or videos. The training may be conducted online, in a classroom, or through remote training, but must be available in both Spanish and English.

Sexual harassment training would need to occur within 90 days of the Bill’s passage or within 30 days of hire, and every 2 years thereafter. Additionally, restaurants would be required to provide proof of a sexual harassment policy and proof of training for all employees upon request by the Department of Human Rights. Employers would face a civil penalty of $500 for their first violation of the Bill and $1000 for every following violation. If the Bill is passed, Illinois will join the growing number of states proposing mandatory sexual harassment training for restaurant employees.

Whether or not the Restaurant Anti-Harassment Bill becomes law, sexual harassment is a serious workplace concern for every restaurant owner. If you have any questions regarding the Bill or would like help revising or implementing your company’s employee handbook or sexual harassment policy to ensure compliance with the Bill before or after it becomes law, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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Minimum Wage Changes in Illinois

dollar-941246_1920In February, Governor JB Pritzker signed a piece of legislation that will set Illinois on track to reach a statewide minimum wage of $15.00 by 2025. To mitigate the effect this change has on small employers, the law allows employers with 50 or fewer employees to claim a tax credit for 25% of the cost of the increase in 2020 and gradually phases out over the next several years.

The following chart shows the dates each incremental increase will occur and the corresponding statewide minimum wage.

Date Minimum Wage
January 1, 2020 $9.25
July 1, 2020 $10.00
January 1, 2021 $11.00
January 1, 2022 $12.00
January 1, 2023 $13.00
January 1, 2024 $14.00
January 1, 2025 $15.00

In addition to raising the minimum wage, the new law imposes harsher penalties on employers who fail to pay their employees minimum wage. Previously, employers were liable for the amount of any underpayment plus a statutory penalty of 2% of the underpayment per month that amount goes unpaid (effectively, interest) and employers could be fined up to 20% of the underpayment. The new law more than doubles the statutory penalty to 5% per month, allows employees to recover three times the amount of the underpayment, and allows for a fine of up to $1,500 per violation in addition to the pre-existing 20% fine.

Employers can also now be fined for their failure to keep the records required by the Illinois Wage Payment and Collection Act, up to $100 for each affected employee.   The Illinois Wage Payment and Collection Act states that an employer must keep, for a period of not less than three years, true and accurate records of: (1) the name and address of each employee; (2) the hours worked each day in each work week by each employee; (3) the rate of pay; (4) the amount paid each pay period to each employee; and (5) all deductions made from wages.

Finally, in addition to these statewide changes it is important to remember that Chicago and the broader Cook County area will also increase minimum wages effective July 1, 2019. The minimum wage will increase from $12 to $13 per hour in Chicago and from $11 to $12 per hour in Cook County. These changes will necessarily affect the maximum tip credit that some employers may be able to take.

If you have any questions about any of these newly effective laws, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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New Year, New and Amended Employment Laws

Over the past year, the Illinois General Assembly andemployer-v-employee-defamation Chicago City Council have enacted or modified several laws and ordinances that affect employers. Sifting through the specific legal language can be tricky, so we’ve summarized the most important changes that are relevant to employers.

Illinois Nursing Mothers in the Workplace Act (NMWA)

Effective August 21, 2018, an amendment to NMWA requires employers to pay for “reasonable break time” spent expressing milk. Previously, NMWA provided that pumping breaks “must, if possible” run concurrently with other break times. The new amendment now prohibits employers from requiring employees to pump during their break time. In addition, employers cannot reduce pay for pumping breaks and can only restrict employees from pumping if it causes “undue hardship” on the employer.

Illinois Human Rights Act (IHRA)

Effective August 21, 2018, three amendments were made to IHRA that are likely to increase the number of claims brought against employers:

  1. Employees have 300 calendar days (instead of 180) from the date of an alleged civil rights violation to file a charge with the Illinois Department of Human Rights (“IDHR”).
  2. The Illinois Human Rights Commission will receive additional resources that will help expedite the administrative process for resolving alleged civil rights violations.
  3. Employees may now opt out of IDHR’s administrative investigation to immediately bring a lawsuit in Illinois state courts.

Illinois Wage Payment Collection Act (IWPCA)

Effective January 1, 2019, amendments to IWPCA require employers to reimburse employees for necessary expenditures that are directly related to services performed for their employers. This includes expenses incurred via “bring your own device” policies “which require employees to use personal cell phones, tablets, or computers for work purposes.” As a result of this amendment, employers should have an established expense reimbursement policy that includes:

  1. The types of expenses that are reimbursable;
  2. The amount or proportion of the expense that is eligible for reimbursement;
  3. The type of documentation required for reimbursement; and
  4. The time period within which employees must submit documents to qualify for reimbursement.

Illinois Equal Pay Act (IEPA)

Effective January 1, 2019, an amendment to IEPA prohibits employers from paying African Americans less than non-African Americans who are performing the same or substantially similar work. Previously, IEPA was limited to ensuring equal pay amongst men and women. Although this amendment is new to Illinois law, federal laws already provided such protections to African Americans.

Illinois Service Member Employment Rights & Reemployment Act (ISERRA)

Effective January 1, 2019, the rights of Illinois employees serving in the military will be governed by ISERRA, which was passed to protect the employment and benefits of service members who take a leave of absence from employment due to military service. ISERRA has expanded the definition of “military service” to include: (1) service in an auxiliary of the United States Armed Forces as the result of an emergency; (2) service in the Illinois State Guard; and (3) absences caused by illness or injury sustained or aggravated during a period of active service.

City of Chicago Office of Labor Standards (OLS)

Established January 1, 2019, OLS will investigate and respond to employee complaints under the City of Chicago’s employment laws, including but not limited to minimum wage, paid sick time, and anti-wage theft laws. These complaints were previously handled by the Department of Business Affairs and Consumer Protection, which remains responsible for business licensing and enforcement of consumer fraud ordinances. This change will likely result in more claims being brought against employers by the City of Chicago.

If you have any questions about any of these newly effective laws or amendments, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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Recent Illinois Supreme Court Ruling Opens Floodgates to Biometric Information Litigation

imagesIn a prior blog post, we advised employers about a once little-known Illinois law, the Biometric Information Privacy Act (BIPA). The BIPA imposes numerous restrictions on how private entities collect, retain, disclose, and destroy biometric identifiers such as fingerprints, voiceprints, retina or iris scans, and scans of hand or face geometry. Businesses most often collect this information from employees, but advances in technology have caused a recent increase in the collection of consumers’ biometric information.

Following years of litigation, on January 25, 2019, the Illinois Supreme Court in Rosenbach v. Six Flags Entertainment Corporation, ruled that an individual can bring a lawsuit for a violation of the BIPA without showing actual harm resulted from the violation. In other words, a business may be held liable for violation of the BIPA for simply collecting biometric information if it does not strictly follow the BIPA guidelines, regardless as to whether a person was actually damaged.

As a result of this ruling, expect a dramatic increase in the number of lawsuits under the BIPA. In fact, less than a week after the Supreme Court’s decision in Rosenbach, class action lawsuits alleging violations of the BIPA were filed on behalf of current and former employees of Little Caesars Pizza, ABT Electronics, Choice Hotels and Warehouse Services Inc. It is now more important than ever to proactively limit your liability when collecting biometric information. In order to avoid liability for collecting biometric information, you must either (1) not collect such information or (2) develop a publicly available written policy in compliance with the BIPA. Under the BIPA, your policy must establish:

  • A retention schedule for storing biometric information; and
  • Guidelines for permanently destroying biometric information when the initial purpose for collecting it has been satisfied, or within 3 years of the individual’s last interaction with the company.

In addition, when collecting or otherwise receiving a customer’s or an employee’s biometric information, you must:

  • Inform the individual in writing that the information is being collected, the purpose for collection, and the length of storage;
  • Obtain a written release from the individual for the collection and storage of the information;
  • Store and transmit all biometric information with the same or better security than used for confidential company information; and
  • Not disclose, sell, lease, trade, or otherwise profit from biometric information unless the individual consents or disclosure is required by law.

If you have any questions about whether your biometric information policy complies with the law, or if you would like a policy and employee release drafted in accordance with the Biometric Information Privacy Act and other applicable laws, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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Five Tips for Selecting the Right Franchise Attorney

Michael Boxerman was quoted in a recent article discussing what to look for when selecting a franchise attorney.  Read what he has to say at 1851franchise.com.

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Trump Administration Proposes Rollback of Obama-era Tip-Pooling Regulations

tip-jar-1422341The Department of Labor (DOL) has proposed changes to the Fair Labor Standards Act’s (FLSA) tip pooling regulations. The proposed changes would roll back the Obama administration’s 2011 regulations that prohibited employers from distributing tips to anyone other than front-of-the-house staff who earned them. Following the 2011 Obama administration regulations, the DOL has maintained that tips earned by front-of-the-house employees–including servers, bartenders, and bussers–are the property of the employees, and that employers may not mandate that they be shared with back-of-the-house employees such as cooks and dishwashers. The current rules also allow for a “tip credit,” whereby employers can pay tipped employees less than the federal minimum wage, as long as tips make up the difference.

The proposed new regulations provide that employers who pay their employees the federal minimum wage and do not take advantage of the “tip credit” own the tips made by front-of-the-house employees. Consequently, employers can pool tips and distribute them between front-of-the-house and back-of-the-house employees as the employer chooses. However, the new regulation lacks concrete limitations, leaving room for employers to use those pooled tips for any purpose. Under the proposed regulations, employers could pocket the tips for themselves.

Proponents of the new regulations say they will remedy the vast disparity in wages between front-of-the-house and back-of-the-house employees. Opponents argue it is not fair for employers to have full control over the distribution of tips earned by employees. They argue, moreover, the new regulations will not actually solve the discrepancy in pay between front-of-the-house and back-of-the-house employees but rather will lead to business owners pocketing the tips.

Lawmakers are now evaluating comments on the new proposed regulations, a process that has no set timeline and could result in the withdrawal, modification, or finalization of the rule change. The DOL Office of Inspector General has also announced that it is auditing the rule-making process related to the new regulations. This announcement came in response to a recent Bloomberg Law report that exposed a previously unreleased internal economic impact analysis showing that workers would lose billions of dollars in tip income as a result of the new regulations.

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Employers: Give Your Employee Handbook A New Year’s Check-Up

paperworkThe National Labor Relations Board (NLRB) is scrutinizing employee handbooks that violate the National Labor Relations Act (NLRA), the law that protects an employees’ collective bargaining and organizing rights. The NLRB looks for workplace rules that restrict—or could be construed to restrict—employees’ right to engage with each other, to organize (including forming, joining or assisting labor unions) and to take other collective action. The language employers use in their employee handbooks is key, because provisions meant to protect the employer may violate the NLRA. The NLRB recommends employers use detailed wording, sufficient context and clarifying examples to prevent misinterpretation.

According to NLRB guidance, your organization’s handbook must not:

  • Prevent employees from discussing hours, wages or other terms of employment, or give employees the impression that they cannot discuss hours, wages, or other terms of employment with each other and with non-employees. However, your handbook may contain a confidentiality provision that specifically applies to the privacy of business details.
  • Prevent employees from criticizing your organization or its supervisors or lead employees to believe that criticizing your organization or its supervisors is restricted. Rules that broadly prohibit “disrespectful,” “rude,” or “inappropriate” behavior without context are often found to be unlawful.
  • Prevent employees from engaging in discussion among themselves. Rules that broadly prohibit “derogatory,” “insulting,” or “offensive” comments without context are often found to be unlawful.
  • Prohibit employees from speaking on an individual level with the media or other third parties, including about terms and conditions of their employment. However, your handbook may prohibit employees from speaking to the media or other third parties on behalf of the employer without authorization.
  • Prevent employees from using your organization’s name, logo, or trademark in a non-commercial manner. However, your handbook may require employees to respect copyright and intellectual property laws.
  • Contain a total ban on photography, recordings or the use of a camera on company property. However, your handbook may regulate photography and recording in the appropriate interest of privacy or while employees are on their “work time.”
  • Contain any provision that your employees would reasonably interpret as preventing them from going on strike, engaging in walkouts or “walking off the job.” However, your handbook may prohibit employees from leaving the workplace without permission for reasons unrelated to organizing or unionizing activities.
  • Contain a broad rule prohibiting any employee conduct that is not in the best interest of the company. However, your handbook may contain specific policies preventing self-dealing or competition against the company.
  • Provide male employees with less parental leave than female employees upon the birth of a child. Furthermore, your handbook must include information about pregnancy accommodations.

Other employment guidelines to consider when crafting your handbook include, limiting unemployment and post-employment claims by:

  • Mandating employees sign a written document detailing your organization’s attendance and punctuality expectations, provided they comply with federal, state and local leave laws.
  • Providing written notice to any employee in violation of these expectations before termination.
  • Keeping all relevant records, including a copy of your attendance policy and all supporting documentation in the case of an employee’s termination.

Ensure compliance with updated sick leave laws (in Chicago and some other Cook County municipalities) by:

  • Allowing your employees to accrue up to 40 hours of paid sick leave per year and carry any unused time over into the next year.
  • Allowing your employees to use at least half of their annual accrued paid sick leave to care for their children or other family members.

If you have any questions about whether your employee handbook complies with the law or you would like a handbook drafted in accordance with the NLRA and other applicable laws, please contact Marcus & Boxerman at (312) 216-2720 or firm@marcusboxerman.com.

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NLRB Reinstates Prior Joint-Employer Standard

On December 14, 2017, in a 3-2 decision, that could allay fears of franchisors being joint employers of their franchisees, the National Labor Relations Board overruled the Board’s 2015 decision in Browning-Ferris Industries, 362 NLRB No. 186 (2015) (“Browning-Ferris”), and returned to the pre–Browning Ferris standard that governed joint-employer liability.
According to the NLRB, in all future and pending cases, two or more entities will be deemed joint employers under the National Labor Relations Act (NLRA) only if there is proof that one entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine.  In other words, explained the NLRB, under the restored pre-Browning Ferris standard, proof of indirect control, contractually-reserved control that has never been exercised, or control that is limited and routine will not be sufficient to establish a joint-employer relationship.  The Board majority concluded that the reinstated standard adheres to the common law and is supported by the NLRA’s policy of promoting stability and predictability in bargaining relationships.
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Chicago’s Sweetened Beverage Tax Repealed Effective December 1, 2017

enjoy-a-coke-1574937In a nearly unanimous vote by the Cook County Board on October 11th, the Cook County sweetened beverage tax has been repealed. Passed in early August 2017, the controversial tax was only in effect for two months before lawmakers decided to retire it. Proponents of the tax reasoned the tax is an effective way to fight obesity and other related health conditions, while also generating income for the county. Opponents of the tax argued that it damaged small businesses and led to plummeting store sales, as customers simply went across county lines to purchase beverages subject to the tax. Large corporations including PepsiCo and Coca-Cola spent millions of dollars fighting the tax. Lawmakers now have until the end of November to adjust the Cook County budget to account for the $200 million of revenue the County estimates the tax would have brought in. The repeal goes into effect December 1, 2017.

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