CAO:  March 24, 2021

The following is an initial review of the Employee Fairness Act which was signed into law.   This legislation places additional compliance mandates on employers in hiring processes and equal pay reporting. ICPAS joined other stakeholder organizations in opposing this legislation. There are ongoing discussions with the Illinois Department of Labor regarding the registration certification process.  It is anticipated that there will be follow-on corrective legislation and additional employer guidance from the Illinois Department of Human Rights and the Illinois Department of Labor.

GOVERNOR SIGNS LEGISLATION LIMITING CRIMINAL CONVICTIONS IN EMPLOYMENT DECISIONS

Governor Pritzker signed Senate Bill 1480 (Employee Fairness Act) which is Public Act 101-0656. This legislation expands prohibitions on employers when considering an individual’s criminal conviction history in employment decisions unless otherwise authorized by law.  Senate Bill 1480 also expands the Illinois Equal Pay Act requiring private-sector employers of more than 100 employees to obtain equal pay registration certificates from the Illinois Department of Labor (IDOL).  

This legislation was advanced during the Illinois General Assembly’s lame duck session as part of the Black Caucus’s equity initiatives. Under P.A. 101-0656, an employer may only consider an individual’s criminal conviction history if there is a substantial relationship between the criminal history and the position sought or held, or if the employer can show the individual’s employment raises an unreasonable risk to property or to safety or welfare of specific individuals or the general public.

Notice and Due Process

If an employer determines the substantial relationship or unreasonable risk standard is met, the employer must provide written notice to the applicant that specifically identifies the relevant conviction record as the basis of the disqualifying decision and the employer’s rationale for why the conviction disqualifies the individual from employment.

The applicant has five business days to respond to the employer’s notice and provide evidence to mitigate the employer’s concern. If after a review of the applicant’s response, the employer must provide another written notice informing the right to file a discrimination complaint with the Illinois Department of Human Rights (IDHR). Note:  This due process must also be followed when employers take an adverse action against an existing employee based on a criminal conviction(s). FAQs.

Employer Compliance with Equal Pay Act-Illinois Department of Labor

The legislation requires qualifying employers ((more than 100 employees) to obtain an equal pay registration certificates from IDOL.  In addition to paying the required IDOL registration certification fee, employers will provide proof of the total wages paid each employee during the prior year as well as the gender, race, and ethnicity of the employees.  P.A. 101-0656 also contains audit provisions and whistleblower protections and provides for a civil penalty in an amount equal to 1 percent of the business’s gross profits for a business that does not obtain a certificate or if a business’s certificate is suspended or revoked.  

Conclusion

While this new law does not prohibit employers from running criminal background checks on applicants, it does create a substantial relationship/unreasonable risk standard as a basis for non-selection and notice and due process rights for applicants to rebut the employer’s determination not to hire or discipline based on the criminal convictions absent the two exceptions stated above.

ICPAS TAKE-AWAYS
• Public Act 101-0656 expands restrictions on employers when using criminal convictions as a hiring determination or employee discipline.
• There are two exceptions to this expansive prohibition—substantial relationship or unreasonable risks.
• Notice and Opportunity to Respond—Employers must notify applicants or employees of determination based on criminal conviction with an opportunity to respond with mitigation to refute the basis of the decision.
• Notice and Complaint to Illinois Department of Human Rights—If after a review of the response and the original non-hire or discipline decision is maintained, the employer must notify the applicant to file a discrimination complaint with the IDHR.
• Requires qualified employers to obtain an equal pay registration certificates from the Illinois Dept. of Labor.
• Provides whistleblower protections and provides for a civil penalty for non-compliance.
• Employers should consult with the HR director and or legal counsel on the requirements of this legislation. 
• Public Act 101-0656 has an effective date of March 23, 2021.