By Alex W. Karasik, Tyler Z. Zmick, and Elizabeth C. Mincer
Duane Morris Takeaways: In the Illinois Supreme Court’s latest ruling in the biometric privacy space, it decided in Walton v. Roosevelt University, 2023 IL 128338 (Ill. Mar. 23, 2023), that claims brought under the Biometric Information Privacy Act (“BIPA”) by bargaining unit employees are preempted by Section 301 of the Labor Management Relations Act (“LMRA”) where an employer invokes a broad management rights provision in a CBA. This ruling – which is consistent with federal court decisions addressing the issue – is a rare win for defendants facing BIPA class actions. Employers with unionized workforces may now be able to assert an LMRA preemption defense in seeking dismissal of BIPA claims based on decisions issued by Illinois’s highest state court and the U.S. Court of Appeals for the Seventh Circuit.
Plaintiff alleged that when he started working at Roosevelt University in 2018, Roosevelt required him to enroll a scan of his hand geometry onto a biometric timekeeping device as a means of clocking in and out of work. Plaintiff sued Roosevelt the following year, alleging that the university violated Sections 15(a), 15(b), and 15(d) of the BIPA in connection with Roosevelt’s use of the timekeeping system by (i) failing to develop a written policy made available to the public establishing a retention policy and guidelines for destroying biometric data, (ii) collecting his biometric data without providing him with the requisite notice and obtaining his written consent, and (iii) disclosing his biometric data without consent.
In response to the complaint, Roosevelt moved to dismiss on the basis that Plaintiff’s claims were preempted by Section 301 of the Labor Management Relations Act (“LMRA”). Specifically, Roosevelt argued that Plaintiff had been a union member while employed by Roosevelt, and the collective bargaining agreement (“CBA”) between Roosevelt and Plaintiff’s union contained a management rights clause broad enough to cover the manner by which union employees clocked in and out of work. As support, Roosevelt cited the U.S. Court of Appeals for the Seventh Circuit’s decision in Miller v. Southwest Airlines Co., 926 F.3d 898 (7th Cir. 2019), which held that federal labor law preempts BIPA claims when the claims require interpretation or administration of a CBA.
The Cook County Circuit Court rejected Roosevelt’s LMRA preemption argument, finding Miller distinguishable and holding that BIPA claims are “not intertwined with or dependent substantially upon consideration” of terms of a CBA because a person’s rights under the BIPA “exist independently of both employment and any given CBA.” Id. ¶ 6. Because the issue presented a close call, however, the Circuit Court certified the following question for interlocutory appeal: “Does Section 301 of the [LMRA] preempt [BIPA] claims asserted by bargaining unit employees covered by a [CBA]?”
The Illinois Appellate Court answered the certified question “yes.” In doing so, the court noted that the Seventh Circuit had recently come to the same conclusion in a case where “the relevant factual and legal circumstances . . . [were] indistinguishable.” Id. ¶ 8 (citing Fernandez v. Kerry, Inc., 14 F.4th 644 (7th Cir. 2021)). The appellate court determined that Fernandez reached the correct conclusion, as the BIPA “contemplates the role of a collective bargaining unit acting as an intermediary on issues concerning an employee’s biometric information.” Id. ¶ 10 (noting that the BIPA prohibits private entities from collecting biometric information without obtaining consent from the subject or the subject’s legally authorized representative).
The Illinois Supreme Court’s Decision
The Illinois Supreme Court subsequently allowed Plaintiff’s petition for leave to appeal, after which it affirmed the appellate court’s decision. The Supreme Court observed that the Seventh Circuit had twice held that federal law preempts BIPA claims asserted under similar circumstances, and it noted that when interpreting federal statutes, Illinois courts look to the decisions of the U.S. Supreme Court (“SCOTUS”) and federal circuit and district courts. It further noted that the SCOTUS’s interpretation of federal law is binding, and that in the absence of SCOTUS precedent, the weight given to federal circuit and district court interpretations of federal law depends on factors such as uniformity of law and the soundness of the decisions. See id. ¶¶ 23-24 (“[I]f lower federal courts are uniform in their interpretation of a federal statute, this court, in the interest of preserving unity, will give considerable weight to those courts’ interpretations of federal law and find them to be highly persuasive.”).
In comparing Plaintiff’s case to the Seventh Circuit decisions, the Supreme Court acknowledged that the relevant CBA provisions in Plaintiff’s case and in Fernandez both contained similarly broad management rights clauses. See id. ¶ 31 (noting the CBA between Roosevelt and Plaintiff’s union stated that “[s]ubject to the provisions of this Agreement, the Employer shall have the exclusive right to direct the employees covered by this Agreement” and that “[a]mong the exclusive rights of management . . . are: the right to plan, direct, and control all operations performed in the building [and] to direct the working force”).
In sum, because the Supreme Court did not find Miller and Fernandez to be “without logic and reason,” id., it deferred to the uniform federal case law on the issue and held that when an employer invokes a CBA’s broad management rights clause in response to a BIPA claim brought by a bargaining unit employee, the plaintiff’s BIPA claims are preempted by the LMRA.
Implications For Employers
Like the Seventh Circuit’s decisions in Miller and Fernandez, Walton reflects a rare defendant-friendly development and provides a basis for certain employers to seek dismissal of BIPA claims on LMRA preemption grounds. The defense applies only to a subset of employers, however, as it can be asserted only by (i) employers with unionized employees who (ii) have entered into a CBA with a union that contains a management rights clause broad enough to cover the manner by which employees clock in and out of work. Furthermore, unionized employees are not prohibited from seeking redress for alleged BIPA violations – they are simply required to first pursue those claims through the grievance procedures in their CBAs rather than in state or federal court.
Moreover, the National Labor Relations Board (“NLRB”) – the agency that enforces the National Labor Relations Act (“NLRA”) – has indicated that it intends to reshape current law regarding employee privacy and management rights provisions. If such changes take effect, they could reshape how courts assess federal labor law preemption in future BIPA cases.
The Walton ruling highlights the importance of carefully negotiating and drafting CBA provisions, particularly with respect to management rights. Employers in states with strict privacy laws (like the BIPA) should consider contract language that specifically provides management with the right to use and store certain biometric data and/or implement other new technologies.