Gerald L. Maatman, Jr. – Page 6 – Class Action Defense

December 18, 2023 by Gerald L. Maatman, Jr.

Hawaii Federal Court Denies Motion To Certify Covid-19 Vaccination Class Action Brought Under Title VII And The ADA

By Gerald L. Maatman, Jr., Nick Baltaxe, and Nathan K. Norimoto

Duane Morris Takeaways: In O’Hailpin v. Hawaiian Airlines Inc., No. 22-CV-00532, 2023 U.S. Dist. LEXIS 220734 (D. Haw. Dec. 12, 2023), Judge Jill Otake of the U.S. District Court for the District of Hawaii denied a motion for class certification brought by current and former employees of Hawaiian Airlines alleging discrimination under Title VII and the ADA against individuals who requested medical or religious accommodations from their employers’ COVID-19 vaccination policy. The decision is pro-defendant and well worth a read in terms of strategies to oppose and prevent class certification of employment discrimination claims.

Case Background

Riki O’Hailpin, along with eight other named plaintiffs (“Plaintiffs”), brought a putative class action against Defendant Hawaiian Airlines Inc. (“Hawaiian”), alleging that Hawaiian violated Title VII of the Civil Rights Act of 1964 (“Title VII”) and the Americans with Disabilities Act (“ADA”) by discriminating against employees who requested medical or religious accommodations from Hawaiian’s Covid-19 vaccination policy. In response to the Covid-19 pandemic, President Biden issued Executive Order No. 14042, a Federal Contractor Mandate that required certain employers to implement a mandatory vaccination policy. Under the Federal Contractor Mandate and related guidelines, Hawaiian was required to have its unvaccinated employees masked and socially distanced in the workplace; thus, any exemptions to the vaccine policy would need to comply with those masking and distancing requirements. Id. at *3. Plaintiffs challenged Hawaiian’s policy that required all employees “to be vaccinated November 1, 2021 unless they had a reasonable accommodation for a disability as defined under the ADA or a sincerely held religious belief that conflicted with their ability to receive a Covid-19 vaccine.” Id. at *3-4.

Hawaiian received 568 reasonable accommodation requests related to the vaccine policy, including 496 for religious accommodations and 72 for medical exemptions. Id. at *3. Hawaiian subsequently examined every work position and every work location to determine whether masking and distancing were feasible and concluded that, for a majority of the positions, they were not. Hawaiian also implemented a “Transition Period Testing Program” that provided a deadline for unvaccinated employees to test and a 12-month unpaid leave of absence for those who did not get vaccinated and were not granted an accommodation. Id. at *6. The complaint alleged Hawaiian engaged in a “pattern and practice of discrimination” under Title VII and the ADA by denying medical and religious accommodation requests and that the Transition Period Testing Program was a pretext for denying accommodation requests. Id. at *17. Plaintiffs sought to represent all current and former Hawaiian employees whose religious and medical vaccine accommodation requests were denied under Hawaiian’s vaccination policy, and proposed a primary class of the approximately 500 employees whose accommodation requests were denied as well as sub-classes, broken down by medical and religious requests, of individuals whose requests were either denied or rescinded by Hawaiian. Id. at *9. Plaintiffs moved for class certification under Rule 23 of the Federal Rules of Civil Procedure. Id.

Plaintiffs’ Motion For Class Certification

The Court evaluated Plaintiffs’ motion for class certification under Rule 23’s requirements of numerosity, adequacy, predominance, typicality, and commonality. First, it expressed skepticism that one of Plaintiffs’ proposed sub-classes satisfied the numerosity requirement. Id. at *12-13. The Court concluded that certification of a sub-class of 14 individuals “whose medical exemption requests were rescinded, such that no final decision was reached … could likely be denied based on numerosity grounds alone.” Id. at *13. At the same time, the Court determined that Plaintiffs satisfied Rule 23’s adequacy of counsel requirement. Id. at *13-14. Hawaiian did not contest the requirement with respect to the named Plaintiffs and their counsel. Id. at *14.

The Court further evaluated whether Plaintiffs’ “pattern and practice” theory of liability met Rule 23’s commonality, typicality, and predominance requirements, with a specific focus on issues susceptible to “generalized proof” versus “individualized proof.” Id. at *20-21. The Court found that Plaintiffs could not satisfy the remaining Rule 23 requirements due to the individualized assessments into each medical and religious accommodation request to determine whether Hawaiian’s treatment of each request constituted actionable discrimination under Title VII and the ADA. Id. at *23-57.

With respect to the sub-classes of individuals who were denied religious accommodation requests, the Court noted that the inquiries into each employee’s “sincerely held religious belief and secular preference” and/or whether the accommodation would cause an “undue hardship” to Hawaiian would require too many individualized assessments to satisfy predominance under Rule 23. Id. at *27–*42. For example, the Court noted the analysis of whether the accommodation would impose an undue hardship on Hawaiian would include an individualized review of each position, location, union status, and the ability to mask and social distance. Id. at *37-39.

For the medical accommodation sub-classes, the Court noted that the ADA extends “only to qualified individuals … who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires.” Id. at *44 (quoting 42 U.S.C. § 12111(8)). For this reason, the Court opined that the reasonableness of the accommodation “is necessarily individualized, based on the person’s position and location, and the extent to which an accommodation would amount to an undue hardship on Hawaiian.” Id. at *52. In light of the individualized inquiries to determine the reasonableness of each accommodation (masking, social distancing, or testing) for each qualified individual, the Court determined that Plaintiffs did not meet their “burden to explain why commonality, typicality, and predominance are met” for the ADA subclasses. Id. at *55-56.

Accordingly, the Court denied Plaintiffs’ motion for class certification and held that a class action was not “the superior way” for Plaintiffs’ claims to proceed. Id. at *56.

Implications For Employers

This decision represents a helpful roadmap for employers to defend not only against potential Covid-19 vaccine-related class action complaints, but also against putative class actions brought under Title VII and the ADA. The Court’s ruling underscores the importance of individualized inquiries for religious and medical accommodation requests under Title VII and the ADA, and offers tools to defend against the plaintiff’s burden of demonstrating predominance, typicality, and commonality at the class certification stage of the litigation.

December 18, 2023December 18, 2023 by Gerald L. Maatman, Jr.

Florida Federal Court Allows The EEOC To Expand Its Lawsuit Based On The Joint Employer Doctrine

By Gerald L. Maatman, Jr. and Christian J. Palacios

Duane Morris Takeaways: In EEOC v. Princess Martha, LLC, et al., Case No. 8:22-CV-2182, 2023 U.S. Dist. LEXIS 219651 (M.D. Fla. Dec. 11, 2023), Judge Charlene Honeywell of the U.S. District Court for the Middle District of Florida ruled that a real estate acquisition firm could not avoid a disability discrimination suit filed by the EEOC, despite the fact that the real estate firm was not named in the original charge of discrimination. The EEOC initially only sent two of the three defendants the operative charge of discrimination, but throughout the course of the investigation the Commission discovered that the real estate acquisition firm was a joint employer, and subsequently sent the real estate firm notice and amended its complaint accordingly. This case illustrates the dangers of joint employer liability for highly integrated corporate entities, and the judicial latitude the EEOC is often afforded to amend its complaints after charging a named party.

Background

In August of 2021, a woman was offered a job at Princess Martha, a Florida retirement community, but her job offer was rescinded after she failed a drug test on account of the medications she took to treat her Post Traumatic Stress Disorder. She promptly filed a charge of discrimination with the EEOC alleging Princess Martha’s hiring practices violated the Americans with Disabilities Act of 1990.

The EEOC sent Princess Martha notice of the charge on November 23, 2021. During the course of its investigation the Commission determined that Princess Martha had a joint employer relationship with TJM Properties, whom it sent notice to on May 26, 2022. After determining that TJM Properties and Princess Martha violated the ADA, and after an unsuccessful conciliation attempt, the EEOC filed a lawsuit against both TJM Properties and Princess Martha on September 21, 2022. The Commission subsequently amended its complaint by adding TJM Property Management to the suit, alleging TJM Property Management received proper notice of the lawsuit because of its interrelated relationship as a single or integrated enterprise and/or joint employer status with the other defendants.

TJM Properties and TJM Property Management moved to dismiss the lawsuit on two grounds: First they argued that the EEOC had failed to exhaust its administrative remedies, including adequately putting the TJM entities on notice and giving them the opportunity to conciliate. Second, they argued that the EEOC’s complaint failed to establish a single/integrated enterprise or joint employer relationship existed between the TJM entities and Princess Martha.

The Court’s Ruling

In ruling in favor of the EEOC, the Court made short work of the defendants’ first argument. TJM Properties participated in the conciliation process and was explicitly notified by the Commission that it was a joint employer to Princess Martha. TJM Property Management similarly received notice due to its interrelated nature with the other defendants, and the TJM entities shared a principal place of business and the same mailing address. Furthermore, the Court pointed to an agreement existed between the defendants that required TJM Property Management to assist in coordinating legal matters with Princess Martha.

With respect to the defendants’ second argument, the Court noted that typically only parties named in EEOC charges could be charged in suits, but courts used a five-factor test to determine whether a non-named party could be sued. Applying the factors to the case, the Court determined that all three defendants were “highly integrated.” Id. at * 8. All three entities shared a mailing address, and the managing members of Princess Martha were also active in the management of TJM. Additionally, the human resources director for Princess Martha was a TJM Properties employee, and all three entities shared a common owner. Because of this, the Court concluded that despite the fact that the EEOC had not named TJM Property Management in the original suit, the highly integrated nature of the defendants made the Commission’s amended complaint appropriate.

Implications For Employers

As the ruling in EEOC v. Princess Martha, LLC illustrates, many courts are reluctant to strictly interpret an EEOC complaint, and the Commission can likely amend its lawsuit if, during the course of its investigation, it discovers that named defendants have highly integrated relationships with non-named entities. Therefore, companies with closely adjacent corporate affiliates should take extra care if they receive a charge of discrimination from the EEOC, as the Commission may later amend its complaint to include a non-named corporate entity.

December 6, 2023 by Gerald L. Maatman, Jr.

The 2023-2024 Judicial Hellholes Report From The American Tort Reform Association Ranks The Worst Jurisdictions For Defendants

By Gerald L. Maatman, Jr. and Jennifer A. Riley

Duane Morris Takeaways: Annually the American Tort Reform Association (“ATRA”) publishes its “Judicial Hellholes Report,” focusing on litigation issues and identifying jurisdictions likely to have unfair and biased administration of justice. The ATRA recently published its 2023-2024 Report and for the first time in the history of the report, the ATRA ranked two jurisdictions at the top of the list – both Georgia and Pennsylvania, specifically the Pennsylvania Supreme Court and the Philadelphia Court of Common Pleas – as the most challenging venues for defendants. Readers can find a copy here and the executive summary here.

The Judicial Hellholes Report is an important read for corporate counsel facing class action litigation because it identifies jurisdictions that are generally unfavorable to defendants. The Report defines a “judicial hellhole” as a jurisdiction where judges in civil cases systematically apply laws and procedures in an unfair and unbalanced manner, generally to the disadvantage of defendants. The Report is a “must read” for anyone litigating class actions and making decisions about venue strategy.

The 2023 Hellholes

In its recently released annual report, the ATRA identified 9 jurisdictions on its 2023 hellholes list – which, in order, include, tied at number one: (1) Georgia – (the defending “champion” from the top of the 2022 list, with massive verdicts bogging down business and more liability expanding decisions issued by the Georgia Supreme Court); and (1) Pennsylvania (especially in the Philadelphia Court of Common Pleas and the Supreme Court of Pennsylvania); (3) Cook County (as a “no-injury required” hotspot and lawsuits stemming from the Illinois Biometric Information Privacy Act); (4) California (with Proposition 65 lawsuits thriving and a huge overall volume of lawsuits, in addition to Private Attorney General Act (PAGA) litigation, lemon law litigation, and environmental hotbed); (5) New York (with “no-injury” consumer class action lawsuits and massive verdicts); (6) South Carolina (particularly in asbestos litigation, with problems related to bias against corporate defendants, unwarranted sanctions, low evidentiary requirements, liability expanding rulings, unfair trials, severe verdicts, and a willingness to overturn or modify jury verdicts to benefit plaintiffs); (7) Lansing, Michigan (particularly due to liability-expanding decisions by the Michigan Supreme Court and pro-plaintiff legislative activity); (8) Louisiana (with long-running costal litigation and insurance claim fraud litigation); and (9) St. Louis, Missouri (with focuses on junk science in the courtrooms and nuclear verdicts).

According to the ATRA’s analysis, these venues are less than optimal for corporate defendants and often attract plaintiffs’ attorneys, particularly for the filing of class action lawsuits. Therefore, corporate counsel should take particular care if they encounter a class action lawsuit filed in one of these venues.

The 2024 “Watch List”

The ATRA also included 3 jurisdictions on its “watch list,” including Kentucky (the ATRA noted that Kentucky, as a newcomer to the list, has been reported as having some lawyers resorting to unethical measures to secure wins); New Jersey (with a powerful trial bar), and Texas (particularly the Court of Appeals for the Fifth District, which the ATRA opined has developed a reputation for being pro-plaintiff and pro-liability expansion).

In addition, the ATRA recognized that several jurisdictions made significant positive improvements this year, highlighting decisions by the New Hampshire and Delaware Supreme Courts, which rejected no-injury medical monitoring claims, the New Jersey Appellate Court, which discarded improper expert testimony, the Texas Supreme Court, which rejected manipulation of juries, and the West Virginia Supreme Court, which placed reasonable limits on employer liability.

In addition to court actions, the ATRA also stated that nine state legislatures enacted positive civil justice reforms this year.

Implications For Employers

The Judicial Hellholes Report often mirrors the experience of companies in high-stakes class actions, as Georgia, Pennsylvania, Illinois, California, New York, South Carolina, Michigan, Louisiana, and Missouri are among the leading states where plaintiffs’ lawyers file class actions. These jurisdictions are linked by class certification standards that are more plaintiff-friendly and more generous damages recovery possibilities under state laws.

December 6, 2023 by Gerald L. Maatman, Jr.

Maryland Federal Court Reinstates Class Certification In Data Breach Class Action

By Gerald L. Maatman, Jr., Jennifer A. Riley, and Emilee N. Crowther

Duane Morris Takeaways: In the proceeding captioned In Re Marriott International Customer Data Security Breach Litigation, MDL No. 8:19-MD-02879, 2023 WL 8247865 (D. Md. Nov. 29, 2023), Judge John Preston Bailey of the U.S. District Court for the District of Maryland granted Plaintiff’s Motion for Class Certification and reinstated several previously-certified classes. The defendant argued that class certification was improper, in part, because the putative class members signed a Choice of Law Provision that contained a class action waiver. Conversely, the plaintiffs contended that the defendant waived its defense based on the Choice of Law Provision. The Court held that (i) the defendant waived its Choice of Law Provision, and (ii) in the absence of an arbitration agreement, the Choice of Law Provision did not override the Rule 23 requirements. For these reasons, this case serves as an important reminder for companies on the importance of the terms of contractual agreements in the context of seeking to arbitrate cases and potentially avoid class or collective actions.

Case Background

In 2016, Marriott purchased Starwood Hotels & Resorts Worldwide (“Starwood”), and inherited Starwood’s IT infrastructure provided by Accenture LLP (“Accenture”) for all Starwood properties. Id. In September 2018, Marriott learned that an unidentified party tried to gain access to the Starwood guest reservation database. After an investigation, Marriott determined Starwood’s database was compromised from July 2014 through September 2018. Id. *1. On November 30, 2018, Marriott disclosed the data breach. Id.

Thereafter, affected consumers filed suit against Marriott and Accenture nationwide. Id. Marriott requested that the actions be consolidated into one multi-district litigation (“MDL”) in the U.S. District Court for the District of Maryland, where Marriott is headquartered. Id. * 4. The case was consolidated, and the plaintiffs filed their joint MDL Complaint alleging various state law contract, statutory consumer protection, and state law negligence claims. Id. The plaintiffs then moved to certify various classes. Id. *2.

The putative class included members of the Starwood Preferred Guest Program (“SPG”). Id. *2. Members of the SPG program signed a contract that contained a “Choice of Law and Venue” Provision (the “Choice of Law Provision”). Id. The Choice of Law Provision stated that any disputes related to the SPG program would “be handled individually without any class action” and would have exclusive jurisdiction in the State of New York. Id. Therefore, the defendant asserted that Rule 23(a)’s “typicality” requirement was not met because the class members were SPG program members, and the class contained both members and non-members of the SPG program. Id.

The District Court agreed with the defendant, and redefined all classes to include only SPG members. Id. *3. However, by doing so, every putative class member was “someone who had purportedly given up the right to engaged in just such class litigation.” In Re Marriott Int’l, Inc., 78 F.4th 677, 682-83 (4th Cir. 2023). The District Court “did not further consider the import of the class waiver on its certification decision,” id. at 683, and granted certification as to three of the plaintiffs’ Rule 23(b)(3) and four Rule 23(c)(4) damages classes. In Re Marriott Int’l, Inc., 341 F.R.D 128, 172-73 (D. Md. 2022). Subsequently, the defendants appealed.

On appeal, the Fourth Circuit held that the District Court erred in failing to address whether or not the SPG members agreed to bar the certification of a class action. In Re Marriott International, 2023 WL 8247865, at *3. The Fourth Circuit vacated the class certification and remanded to the District Court to consider the effect of the Choice of Law Provision on the class. Id.

The District Court’s Decision

The District Court concluded that (i) the defendants waived the Choice of Law Provision, and (ii) absent an arbitration agreement, Rules 23 and 42 prevailed over the parties’ Choice of Law Provision Id. Accordingly, the District Court reinstated the previously-certified classes.

First, the District Court analyzed the plaintiff’s position that the defendants waived the Choice of Law Provision. It opined that “[w]aiver is the intentional relinquishment or abandonment of a known right.” United States v. Olano, 507 U.S. 725, 733 (1993) (internal citations omitted). The District Court reasoned that a party “waives a contractual provision when the party takes actions that are inconsistent with the provision.” In Re Marriott International, 2023 WL 8247865, at *4. The District Court held the defense “clearly waived 5/6” of its Choice of Law Provision because the defendants: (1) requested consolidation into an MDL, which “is the antithesis of handling each claim on an individual basis”; (2) stated that “separately litigating each of the 59 related actions” would “offer no benefit” and heighten the burdens of all involved; and (3) stated venue was proper in Maryland and requested that the MDL be assigned to Maryland, which was inconsistent with the New York Choice of Law Provision. Id. As such, the District Court found that the defendants waived the Choice of Law Provision and all terms contained therein. Id.

Second, the District Court held that it was not required to enforce the Choice of Law Provision outside of a binding arbitration provision. Id. *8. The Choice of Law Provision was “patently distinguishable” from “all of the reported cases on contractual class action waivers” because it did not have a mandatory arbitration clause. Id. *7. When parties agree to resolve their case in a non-judicial forum such as arbitration, “the Federal Rules have limited applicability”. Id. *6. However, in the absence of such an agreement, the District Court opined that “[t]he parties cannot by agreement dictate that a district court must ignore the provisions of Rule 23 of the Federal Rules of Civil Procedure.” Id. *7. The District Court found that Rule 23 and Rule 42 do not “call for consideration of the parties’ preferences,” but rather “furtherance of efficient judicial administration.” Id. Thus, the District Court was not required to enforce the Choice of Law Provision, and held that the plaintiffs did not waive their right to bring a class action claim. Id. *8 *(quoting Martrano v. Quizno’s Franchise Co., 2009 WL 1704469, at *20-21 (W.D. Pa. June 15, 2009)).

Implications For Companies

Companies should proactively review their arbitration agreements and class or collective action waivers to ensure that contractually agreed-upon terms can and will be imposed by a court. Additionally, when faced with multiple nationwide claims, companies should analyze their case defense strategy and make an informed decision before filing and/or joining an MDL. Finally, as part of any acquisition, companies should have their own data security team thoroughly vet and approve the acquired company’s security infrastructure prior to, or shortly after, the acquisition.

December 5, 2023 by Gerald L. Maatman, Jr.

Illinois Supreme Court Endorses Broad Interpretation Of The BIPA’s “Health Care Exception”

By Gerald L. Maatman, Jr. and Tyler Zmick

Duane Morris Takeaways: In the latest ruling in the biometric privacy class action space, the Illinois Supreme Court embraced a broad reading of the “health care exception” in the Illinois Biometric Information Privacy Act (“BIPA”) in Mosby v. Ingalls Memorial Hospital, 2023 IL 129081 (Ill. Nov. 30, 2023). The Illinois Supreme Court held that the statute excludes from its scope data collected in two separate and distinct scenarios: (1) “information captured from a patient in a health care setting”; and (2) information collected “for health care treatment, payment, or operations under the federal Health Insurance Portability and Accountability Act of 1996 (HIPAA).” Unlike clause (1), the Supreme Court held that the exception in clause (2) is not limited to data obtained from patients and serves to exclude information that originates from any source.

The Mosby ruling is welcome news to BIPA defendants and companies operating in the health care space. In the wake of the decision, courts likely will be asked to define the exact contours of the BIPA’s broadened “health care exception” in cases presenting facts that are less obviously tied to health care treatment, payment, or operations compared to the facts at issue in Mosby.

Case Background

The Plaintiffs in Mosby were nurses who claimed that their hospital-employers required them to use a fingerprint-based medication-dispensing system to verify their identities. Plaintiffs sued their employers and the company that distributed the medication-dispensing system, alleging that Defendants violated §§ 15(a), 15(b), and 15(d) of the BIPA by using the medical-station scanning device to collect, use, and/or store their “finger-scan data” without complying with the BIPA’s notice-and-consent requirements and by disclosing their purported biometric data to third parties without first obtaining their consent.

Defendants moved to dismiss in the trial court, arguing that the claims failed because Plaintiffs’ data was specifically excluded from the BIPA’s scope under § 10 of the statute, which states that “[b]iometric identifiers do not include information captured from a patient in a health care setting or information collected, used, or stored for health care treatment, payment, or operations under [the HIPAA].” 740 ILCS 14/10. Defendants argued that the latter clause applied in that Plaintiffs’ fingerprints had been used in connection with Plaintiffs providing medicine to patients, meaning their fingerprints were “collected, used, or stored for health care treatment, payment, or operations under [the HIPAA].” Id.

The trial court denied Defendants’ motions. It ruled that § 10’s “health care exception” was limited to patient information protected under the HIPAA and that the exclusion does not extend to information collected from health care workers.

On appeal, the First District of the Illinois Appellate Court affirmed the denial of Defendants’ motions to dismiss. Echoing the trial court, the Appellate Court determined that the biometric data of health care workers is not excluded from the BIPA’s scope and that the relevant provision of § 10 excluded from the BIPA’s protections “only patient biometric information.” Mosby, 2023 IL 129081, ¶ 16; see id. ¶ 17 (“[T]he appellate court held that ‘the plain language of the statute does not exclude employee information from the [BIPA’s] protections because they are neither (1) patients nor (2) protected under HIPAA.’”) (citation omitted).

Appellate Court Judge Mikva dissented from the majority’s opinion. Judge Mikva opined that the legislature meant to exclude from the BIPA’s scope the biometric data of health care workers “where that information is collected, used, or stored for health care treatment, payment, or operations, as those functions are defined by the HIPAA.” Id. ¶ 19 (citation omitted). Judge Mikva expressed the view that the first part of § 10’s “health care exception” excludes from the BIPA’s coverage information from a particular source (i.e., patients in a health care setting) and that the second part excludes information used for particular purposes (i.e., health care treatment, payment, or operations), regardless of the source of that information.

The Illinois Supreme Court’s Decision

On further appeal, the Illinois Supreme Court agreed with Appellate Court Judge Mikva’s dissent, unanimously holding that the BIPA’s exclusion for “information collected, used, or stored for health care treatment, payment, or operations under [the HIPAA]” can apply to the biometric data of health care workers (not only patients).

The Supreme Court determined that the relevant sentence of § 10 excludes from the definition of “biometric identifier” data that may be collected in two distinct (rather than overlapping) scenarios – namely, biometric identifiers do not include (i) information captured from a patient in a health care setting or (ii) information collected, used, or stored for health care treatment, payment, or operations under HIPAA. Id. ¶ 37 (“[T]he phrase prior to the ‘or’ and the phrase following the ‘or’ connotes two different alternatives. The Illinois legislature used the disjunctive ‘or’ to separate the [BIPA’s] reference to ‘information captured from a patient in a health care setting’ from ‘information collected, used, or stored for health care treatment, payment, or operations under [the HIPAA].’ Pursuant to its plain language, information is exempt from the [BIPA] if it satisfies either statutory criterion.”) (internal citations omitted).

The Supreme Court agreed with Defendants that the two categories of information are different because information excluded under the first clause originates from the patient, whereas information excluded under the second clause may originate from any source. Regarding the second clause, the Supreme Court observed that the Illinois legislature borrowed the phrase “health care treatment, payment, and operations” from the federal HIPAA regulations. Accordingly, the Supreme Court determined that “the legislature was directing readers to the HIPAA to discern the meaning of those terms,” which meanings “relate to activities performed by the health care provider – not by the patient.” Id. ¶ 52.

Thus, the Supreme Court held that a health care worker’s data used to permit access to medication-dispensing stations for patient care qualifies as “information collected, used, or stored for health care treatment, payment, or operations under [the HIPAA]” and is exempt from the statute’s scope.

Implications Of The Decision

After the recent slew of plaintiff-friendly BIPA decisions issued by both state and federal courts, the Illinois Supreme Court’s decision in Mosby comes as welcome news for companies facing privacy-related class actions – particularly those operating in the health care space.

Relying on Mosby, defendants will likely add the BIPA’s “health care exception” to their arsenal of defenses in a wider array of cases moving forward. Importantly, for purposes of the second “HIPAA prong” of the statute’s “health care exception,” federal HIPAA regulations govern the definitions of the terms “health care treatment,” “payment,” and “operations.” Given that the regulatory definitions of those terms are broad, see 45 C.F.R. § 160.103; id. § 164.501, defendants will likely test the breadth of the exception in future cases presenting facts that may be less obviously tied to health care treatment, health care payment, and/or health care operations compared to the facts at issue in Mosby.

December 5, 2023 by Gerald L. Maatman, Jr.

The Duane Morris Class Action Review – 2024 Is Coming Soon!

By Gerald L. Maatman, Jr. and Jennifer A. Riley

Duane Morris Takeaway: Happy Holidays to our loyal readers of the Duane Morris Class Action Defense Blog! Our elves are busy at work this holiday season in wrapping up our start-of-the-year kick-off publication – the Duane Morris Class Action Review – 2024. We will go to press in early January, and launch the 2024 Review from our blog and our book launch website.

The 2024 Review builds on the success of last year’s edition. At over 500 pages, the 2024 Review has more analysis than ever before, with an analysis of over 1,100 class certification rulings from federal and state courts over this past year. The Review will be available for download as an E-Book too.

The Review is a one-of-its-kind publication analyzing class action trends, decisions, and settlements in all areas impacting Corporate America, including the substantive areas of antitrust, appeals, the Class Action Fairness Act, civil rights, consumer fraud, data breach, EEOC-Initiated and government enforcement litigation, employment discrimination, the Employee Retirement Income Security Act of 1974, the Fair Credit Reporting Act, wage & hour class and collective actions, labor, privacy, procedural issues, product liability and mass torts, the Racketeer Influenced and Corrupt Organizations Act, securities fraud, state court class actions, the Telephone Consumer Protection Act, and the Worker Adjustment and Retraining Notification Act. The Review also highlights key rulings on attorneys’ fee awards in class actions, motions granting and denying sanctions in class actions, and the top class action settlement in each area. Finally, the Review provides insight as to what companies and corporate counsel can expect to see in 2024.

We are humbled and honored by the recent review of the Duane Morris Class Action Review – 2023 by Employment Practices Liability Consultant Magazine (“EPLiC”) – the review is here. EPLiC said that “The Review must-have resource for in-depth analysis of class actions in general and workplace litigation in particular.” EPLiC continued that “The Duane Morris Class Action Review analyzes class action trends, decisions, and settlements in all areas impacting Corporate America. The Review also highlights key rulings on attorneys’ fee awards in class actions, motions granting and denying sanctions in class actions, and the top class action settlement in a myriad of substantive areas. Finally, the Review provides insight as to what companies and corporate counsel can expect to see in 2023 in terms of filings by the plaintiffs’ class action bar.”

We look forward to providing this year’s edition of the Review to all of our loyal readers in early January. Stay tuned and Happy Holidays!

November 24, 2023 by Gerald L. Maatman, Jr.

Report From Montreal: What A Comparative Analysis Of ESG Class Action Litigation May Teach USA-Based Companies

By Gerald L. Maatman, Jr.

Duane Morris Takeaways: USA-based companies are experiencing a deluge of class action litigation. Part of the increase is related to ESG-related claims (“Environmental, Social, and Governance”) involving environmental justice, product advertising, employment and DEI, corporate social responsibility, and investment practices. At the National Conference on Class Actions 2023 by BLG and the Quebec Bar Association in Montreal, Jerry Maatman of the Duane Morris Class Action Defense Group provided commentary on the state of U.S. class action litigation and how Asian, European, and U.S.-based corporations should be “looking around the corner” to ready themselves for new class action theories advancing ESG-related claims..

The National Conference on Class Actions in Montreal – with a robust two day agenda and roster of speakers from Canada, Europe, and Asia – examined diverse issues on cutting-edge class actions on a global basis. Subjects included the phenomenon of the “continuous evolution” of class action theories; securities fraud class action theories; collective, opt-in and opt-out representative actions in Canada and Europe; cross-jurisdictional class actions; and the dawn of ESG class actions filed by NGO’s, consumers, workers, and advocacy groups.

I had the privilege of speaking in Montreal on the current state of U.S. class action litigation, its impact on the global economy and litigation in non-U.S. jurisdictions, and the future of ESG-related class-wide litigation in America.

The plaintiffs’ class action bar in the United States is exceedingly innovative and in constant pursuit of “the next big then” insofar as potential liability is concerned for acts and omissions of Corporate America. Environmental, Social, and Governance issues – known as “ESG” – each of the verticals within ESG are topics on the mind of leading plaintiffs’ class action litigators. As ESG-related issues evolve and become increasingly more important to corporate stakeholders, class action litigation against companies is inevitable and has already begun to take shape. Factors driving these class actions include the new “social inflation” concepts coming out to the COVID-19 pandemic, as well as social movements coalescing around climate change, technological disruptions, and social justice.

The Class Action Context

In 2022, the plaintiffs’ class action bar filed, litigated, and settled class actions at a breathtaking pace. The aggregate totals of the top ten class action settlements – in areas as diverse as mass torts, consumer fraud, antitrust, civil rights, securities fraud, privacy, and employment-related claims – reached the highest historical totals in the history of American jurisprudence. Class actions and government enforcement litigation spiked to over $63 billion in settlement totals. As analyzed in our Duane Morris Class Action Review, the totals included $50.32 billion for products liability and mass tort, $8.5 billion for consumer fraud, $3.7 billion for antitrust, $3.25 billion for securities fraud, and $1.3 billion for civil rights. While the exact totals are not in yet for 2023, aggregate settlement numbers are nearly as high over the past 11 months.

As “success begets success’ in this litigation space, the plaintiffs’ bar is focused on areas of opportunity for litigation targets. ESG-related areas are a prime area of risk.

The ESG Context

Corporate ESG programs is in a state of constant evolution. Early iterations were heavily focused on corporate social responsibility (or “CSR”), with companies sponsoring initiatives that were intended to benefit their communities. They entailed things like employee volunteering, youth training, and charitable contributions as well as internal programs like recycling and employee affinity groups. These efforts were not particularly controversial.

In recent years, ESG programs have become more extensive and more deeply integrated with companies’ core business strategies, including strategies for avoiding risks, such as those presented by employment discrimination claims, the impacts of climate change, supply chain accountability, and cybersecurity and privacy. Companies and studies have increasingly framed ESG programs as contributing to shareholder value.

As ESG programs become larger and more integrated into a company’s business, so do the risks of attracting attention from regulators and private litigants.

Class Actions Are Coming From Multiple Quarters

While class action litigation can emanate from many sources, four areas in particular are of importance in the ESG space.

Shareholders: Lawsuits by shareholders regarding ESG matters are accelerating. Examples include claims that their stock holdings have lost value as a result of false disclosures about issues like sexual harassment allegations involving key executives, cybersecurity incidents, or environmental disasters. Even absent a stock drop, some shareholders have brought successful derivative suits focused on ESG issues. Of recent note, employees of corporations incorporated in Delaware who serve in officer roles may be sued for breach of the duty of oversight in the particular area over which they have responsibility, including oversight over workplace harassment policies. In its ruling in In Re McDonald’s Corp. Stockholder Derivative Litigation, No. 2021-CV-324 (Del. Ch. Jan. 25, 2023), the Delaware Court of Chancery determined that like directors, officers are subject to oversight claims. The ruling expands the scope of the rule established in the case of In Re Caremark International Inc. Derivative Litigation, 698 A.2d 959 (Del. Ch. 1996), which recognized the duty of oversight for directors. The decision will likely result in a flurry of litigation activity by the plaintiffs’ bar, as new cases will be filed alleging that officers in corporations who were responsible for overseeing human resource functions can be held liable for failing to properly oversee investigations of workplace misconduct such as sexual harassment.

Vendors and Business Partners: As companies face increasing demands to address ESG issues in their operations and throughout their supply chains, ESG requirements in commercial contracts are increasing in prevalence. Requirements imposed on vendors, suppliers, and partners – to ensure their operations do not introduce ESG risks (e.g., by using forced or child labor or employing unsustainable environmental practices) are becoming regular staples in a commercial context. In addition, as more companies report greenhouse gas emissions – and may soon be required by the SEC to report on them – they increasingly require companies in their supply chain to provide information about their own emissions. Furthermore, if the SEC’s proposed cybersecurity disclosure rules are enacted, companies also may require increased reporting regarding cybersecurity from vendors and others. These actions – and disclosures – provide fodder for “greenwashing” claims, where consumers claim that company statements about environmental or social aspects of their products are false and misleading. The theories in these class actions are expanding by encompassing allegations involving product statements as well as a company’s general statements about its commitment to sustainability.

State Consumer Protection and Employment Laws: The patchwork quilt of state laws create myriad causes of action for alleged false product advertising and other misleading marketing statements. The plaintiffs’ bar also has invoked statutes like the Trafficking Victims Protection Reauthorization Act to bring claims against companies for alleged failures to stop alleged human rights violations in their supply chains. These claims typically allege that the existence of company policies and programs aimed at helping end human rights violations are themselves a basis for liability. In making human capital management disclosures a part of ESG efforts (including whether to disclose numeric metrics or targets based on race or gender), companies may find themselves in a difficult place with respect to potential liability stemming from stated commitments to diversity and inclusion. On the one hand, companies that fail to achieve numeric targets they articulate (e.g., a certain percent or increase in diversity among management) may subject themselves to claims of having overpromised when discussing their future plans. Conversely, employers that achieve such targets may face “reverse discrimination” claims alleging that they abandoned race-based or gender-neutral employment practices to hit numbers set forth in their public statements.

Government Enforcement Litigation: Federal, state and local government regulators have taken multiple actions against companies based on their alleged participation in climate change, investments inconsistent with ESG goals, or alleged illegal activities. For instance, in 2019, the U.S. Department of Justice investigated auto companies for possible antitrust violations for agreeing with California to adopt emissions standards more restrictive than those established by federal law. While the investigation did not reveal wrongdoing, it underscores the creativity that proponents and opponents of ESG efforts can employ.

Implications For Corporate Decision-Makers

The creation, content, and implementation of ESG programs carries increasing litigation risks for corporations but it is unlikely that ESG programs will diminish is size or scale in the coming years given increased focus by Fortune 100s and 500s and increased regulation at the federal and state levels.

Sound planning, comprehensive legal compliance, and systematic auditing of ESG programs should be a key focus and process of all entities beginning or continuing their ESG journey. As more and more companies adopt some level of corporative ESG strategy planning, compliance and auditing are some of the key imperatives in this new world of exposure to diminish and limit one’s exposure.

November 15, 2023November 15, 2023 by Gerald L. Maatman, Jr.

Illinois Appellate Court Denies Cell Phone Retailer’s Second Attempt To Arbitrate Class Action Privacy Claims

By Gerald L. Maatman, Jr. and Tyler Zmick

Duane Morris Takeaways: In Ipina v. TCC Wireless, 2023 IL App (1st) 220547-U (Nov. 9, 2023), the First District of the Illinois Appellate Court held that T-Mobile retailer TCC Wireless was barred from enforcing an arbitration clause in the plaintiff’s employment agreement based on TCC’s actions in an earlier-filed privacy class action it settled. The Court determined that TCC was collaterally estopped from compelling the plaintiff’s claims to arbitration because TCC had unsuccessfully moved to send nearly identical claims to arbitration in the earlier-filed case. In doing so, the Illinois Appellate Court embraced a broad view of the circumstances in which “offensive” collateral estoppel is warranted in the class action context – that is, when a party may be prohibited from making an argument that was already raised and rejected in an earlier case.

Background

Plaintiff Stephanie Ipina alleged that while employed by Defendant TCC Wireless, she used a fingerprint-based timekeeping device to clock in and out of work. According to Plaintiff, her use of the timekeeping device resulted in TCC collecting her biometric data. Plaintiff claimed that TCC did not give her prior notice that it would be collecting her biometric data or obtain her prior written consent, and that TCC disclosed her data to TCC’s “payroll provider” without Plaintiff’s consent. Based on these allegations, Plaintiff asserted that TCC violated §§ 15(b) and 15(d) of the Illinois Biometric Information Privacy Act (the “BIPA”).

Plaintiff’s complaint also described a prior BIPA class action entitled Garcia v. TCC Wireless, which had been brought against TCC based on the same timekeeping device used by the Plaintiff in Ipina. In Garcia, TCC responded to the complaint by moving to compel arbitration pursuant to the plaintiff’s employment agreement, which stated that “[a]ny dispute arising out of or relating in any [way] to Employee’s employment with [TCC] . . . shall be resolved by binding arbitration . . . . except for (i) the institution of a civil action seeking equitable relief, or (ii) the institution of a civil action of a summary nature where the relief sought is predicated on there being no dispute with respect to any fact.” Id. ¶ 7.

The trial court in Garcia denied TCC’s motion to compel because TCC did not dispute that it collected employees’ biometric data without consent, and therefore the plaintiff’s claims were subject to the arbitration clause’s “carve-out” for claims “of a summary nature where no facts are in dispute.” Id. ¶ 23. The parties in Garcia later reached a class-wide settlement, after which TCC produced a list of 899 employees to include in the settlement class. Due to TCC “compil[ing] the class incorrectly,” however, Plaintiff Stephanie Ipina and other TCC employees were omitted from the list of class members eligible to receive payments in connection with the Garcia settlement.

In response to the complaint filed in the Ipina case (on behalf of Plaintiff and other individuals who should not have been omitted from the settlement class in Garcia), TCC moved to compel Plaintiff’s BIPA claims to arbitration based on the same employment agreement provision at issue in Garcia. In opposing the motion, Plaintiff argued that TCC was collaterally estopped from compelling arbitration based on TCC’s motion to compel arbitration having been denied in the Garcia action. The trial court granted TCC’s motion, however, reasoning that collateral estoppel did not apply because unlike in Garcia, in the present case TCC denied the factual allegations set forth in the complaint.

The Illinois Appellate Court’s Decision

On appeal, the Illinois Appellate Court reversed the trial court and held that TCC was collaterally estopped from enforcing the arbitration provision in Plaintiff’s employment agreement.

The Court noted that collateral estoppel is an equitable doctrine that “promotes fairness and judicial economy by preventing the relitigation of issues that have already been resolved in earlier actions.” Id. ¶ 21 (internal quotation marks and citation omitted). A party seeking to collaterally estop its opponent from raising a particular argument must show that (i) the current issue is identical to one that was resolved in a prior action; (ii) the court in the previous matter entered a final judgment on the merits; and (iii) the party against whom estoppel is being asserted was a party, or in privity with a party, to the prior litigation.

The Appellate Court summarized TCC’s litigation conduct in Garcia by noting that in that case, TCC did not dispute that it collected employees’ biometric data without consent; in light of that fact, the court in Garcia denied TCC’s motion to compel arbitration because of the arbitration provision’s exception for claims of a summary nature where no facts are in dispute; the court also denied TCC’s motion to reconsider the order denying TCC’s motion to compel arbitration, which denial TCC did not appeal; and the parties subsequently settled the case on a class-wide basis.

Based on these facts, and contrary to the trial court’s order, the Appellate Court ruled that Plaintiff had shown that the collateral estoppel elements were established, and that the trial court erred in not applying the doctrine.

First, the Appellate Court rejected TCC’s attempt to distinguish the present case from Garcia on the basis that unlike Garcia, in this case TCC had denied the allegations in Plaintiff’s complaint. According to the Appellate Court, this argument was contradicted by the position TCC had taken throughout the litigation, which is that Plaintiff should have been included in the Garcia settlement because TCC collected her biometric data before she signed a consent form. Because “TCC is bound by these admissions,” the Appellate Court ruled that the issue in the present case was identical to the issue resolved in Garcia because TCC had effectively conceded the plaintiffs’ factual allegations in both cases. Id. ¶ 25.

Second, the Appellate Court found that the trial court in Garcia entered a “final judgment on the merits” when it issued an order granting final settlement approval and dismissing the case with prejudice. Acknowledging the split in authority as to whether a settlement agreement qualifies as a “final order on the merits,” the Appellate Court sided with those decisions reflecting the proposition that “policy reasons counsel in favor of applying the doctrine of collateral estoppel to interlocutory judgments after settlement and dismissal with prejudice.” Id. ¶ 28 (citation omitted). As stated by the Appellate Court, “[c]ollateral estoppel exists to prevent litigants from doing exactly what TCC attempts. The doctrine’s purpose is to prevent a party from losing an issue on the merits, but then relitigating it before a different judge to procure the desired result.” Id. ¶ 29. Thus, the Appellate Court found that Plaintiff satisfied the second element.

Third, the Appellate Court held that the last collateral estoppel element was satisfied because TCC was the defendant in Garcia and was the same party against whom estoppel was being asserted in the present case. See id. ¶ 30 (“TCC was a party in Garcia, where it had the same incentive to fully litigate the enforcement of the arbitration clause (and in fact did so).”). However, the Appellate Court also noted that while both parties argued on appeal the issue of Plaintiff’s privity, that was is “irrelevant” because “the privity requirement only applies to the party against whom estoppel is asserted.” Id.

Implications For Corporations

Ipina is an important reminder that a litigation decision made in one case can have potentially significant consequences for that party in an entirely separate action. As illustrated in the Ipina case, a party’s position in one matter (e.g., a defendant conceding the truth of certain factual allegations in a complaint) can be used to limit (or entirely foreclose) that party’s ability to raise a defense in another matter – regardless of how strong the defense might be on the merits.

Thus, corporate defendants should always think about the “big picture” when deciding on a course of action to take in defending a lawsuit. They should consider not only how a defense position may impact that particular litigation, but also how the position could affect separate and seemingly unrelated actions involving the same (or a related) party, whether in cases that are currently pending or that may be filed in the future.

November 12, 2023November 12, 2023 by Eden Anderson

California Supreme Court Expresses Concern At Estrada Oral Argument About Manageability Of PAGA Claims

By Eden E. Anderson, Gerald L. Maatman, Jr., and Jennifer A. Riley

Duane Morris Takeaways: In a case with significant consequences for employers, the California Supreme Court heard oral argument in Estrada v. Royalty Carpet Mills, No. S274340, on November 8, 2023. In Estrada, the Supreme Court will decide whether trial courts have inherent authority to ensure that PAGA claims will be manageable at trial, and to strike or narrow such claims if they cannot be managed appropriately. The Supreme Court signaled during oral argument its concerns with unwieldy PAGA claims that, if tried, would require a series of mini-trials over the course of years. The Supreme Court further expressed concern with ensuring that employers’ due process rights to present affirmative defenses are protected, potentially signaling the issuance of an employer-friendly decision. A decision is expected in the next three months, and has the potential to transform the prosecution and defense of PAGA litigation.

Case Background

Jorge Estrada filed a putative class action and PAGA action against his former employer asserting meal period violations. After two classes comprised of 157 individuals were certified, the parties tried the claims before a judge in a bench trial. The trial court ultimately decertified the classes, finding there were too many individualized issues to support class treatment. Although the trial court awarded relief to four individual plaintiffs, it dismissed the non-individual PAGA claim, concluding it was not manageable.

On appeal, Estrada argued that PAGA claims have no manageability requirement, and the Court of Appeal agreed in Estrada v. Royalty Carpet Mills, Inc., 76 Cal.App.5th 685 (2022). The Court of Appeal reasoned that class action requirements do not apply in PAGA actions and, therefore, the manageability requirement rooted in class action procedure was inapplicable. Further, the Court of Appeal opined that “[a]llowing courts to dismiss PAGA claims based on manageability would interfere with PAGA’s express design as a law enforcement mechanism.” Id. at 712. The Court of Appeal acknowledged the difficulty that employers and trial courts face with PAGA claims involving thousands of allegedly aggrieved employees, each with unique factual circumstances, but concluded that dismissal for lack of manageability was not an available tool for a trial court to utilize.

Estrada is contrary to the holding in Wesson v. Staples the Office Superstore, LLC, 68 Cal.App.5th 746 (2021), and created a split in authority. In Wesson, the trial court struck a PAGA claim as unmanageable, and the Court of Appeal affirmed. The claims at issue in Wesson involved the alleged misclassification of 345 store managers. The employer’s exemption affirmative defense turned on individualized issues as to each manager’s performance of exempt versus non-exempt tasks, which varied based on a number of factors including store size, sales volume, staffing levels, labor budgets, store hours, customer traffic, all of which varied across the stores. The split in authority prompted the California Supreme Court to grant review in Estrada, but not Wesson.

Oral Argument At The California Supreme Court

During oral argument on November 8, 2023, several Justices, most prominently Justices Liu and Jenkins, expressed skepticism that a trial court’s inherent powers include the ability to outright strike or dismiss an entire PAGA action for lack of manageability. As Justice Liu commented, permitting trial courts such wide ranging power would shortchange the PAGA statute unless there is an overriding constitutional interest.

Several Justices also acknowledged that an employer has a due process right to present evidence to support its affirmative defenses and that, in certain cases, such evidence presentation might require a series of mini-trials over a period of years and wholly consume a trial court’s resources. Justice Kruger asked questions of Estrada’s counsel that suggested the illogical nature of these issues telling trial courts as to what to do in terms of mini-trials, and how unwieldy such PAGA-related problems would evolve under such a set of principles.

Justice Groban also expressed concern about a PAGA case where multiple Labor Code violations are alleged, hundreds or thousands of employees are at issue, and different work sites and different types of employees ranging from janitors to accountants are implicated. Justice Groban asked why, in that case, a trial court could not just limit the case to the accountants only. Other justices raised similar concerns, with Chief Justice Guerrero asking Estrada’s counsel why the answer is that this is all subject to appellate review.

Implications For Employers

The constellation of the comments from the justices seemingly signals that the California Court may hold that trial courts possess inherent authority to ensure an employer’s right to due process is safeguarded, which necessarily encompasses the right to gauge the manageability of PAGA claims and to narrow them as appropriate. As to whether such authority could include outright dismissal of an entire PAGA case, employers will have to wait and see.

November 10, 2023 by Gerald L. Maatman, Jr.

Implementation Of Equal Pay And Benefits Requirement Of The Illinois Day & Temporary Labor Services Act Likely Postponed Until April 2024

By Gerald L. Maatman, Jr. and Gregory Tsonis

Duane Morris Takeaways – In a significant development impacting both staffing agencies and their customers, recent legislative changes in Illinois propose to delay implementation of the equal pay provision of the Illinois Day and Temporary Labor Services Act (IDTLSA) until April 1, 2024. Further, recent guidance from the Illinois Department of Labor clarifies that the 90-day period which triggers the equal pay and benefit provision requires a temporary laborer to actually work 90 days for a client employer. A comprehensive breakdown of the 2023 amendments to the IDTLSA and the law’s significant new requirements can be found here.

Proposed Amendment And Recent Clarification To Equal Pay And Benefit Provision

On November 9, 2023, both houses of the Illinois General Assembly passed legislation that further amends Section 42 of the IDTLSA. The original IDTLSA amendments, passed on August 4, 2023, required staffing firms to provide day and temporary laborers with equal pay and benefits as workers employed directly by the client employer after 90 days of work. The new bill passed by the Illinois legislature, HB 3641, proposes to delay the start of the 90-day calculation period. Specifically, the approved bill adds language to the IDTLSA stating that “[t]he calculation of the 90 calendar days may not begin until April 1, 2024.” This proposed delay would provide employers and staffing agencies with additional time to ensure compliance with the IDTLSA’s equal pay requirements.

It is important to note that this amendment, if signed into law by Governor J. B. Pritzker, extends the timeline for compliance with the IDTLSA’s equal pay and benefits provision only. It does not, however, exempt employers and staffing agencies from adhering to other mandates of the IDTLSA, which took effect on August 4, 2023. These mandates include but are not limited to placement fee restrictions, required safety training, labor issue disclosures, and stringent recordkeeping requirements.

Further clarifying the scope of these requirements, the Illinois Department of Labor published a list of frequently asked questions following the amendments’ passage on August 4, 2023. One frequent question raised by employers and staffing agencies alike is whether the 90 days which entitle a temporary employee to equal pay and benefits is 90 days assigned at a client or 90 days actually worked. The IDOL’s recently published Day and Temporary Labor Service Agency FAQ (which can be found here) clarifies that the 90-day count “includes only days worked by a day or temporary laborer for the third-party client within a 12-month period, not simply the total duration of the contract or assignment.” Notably, even a minimal amount of time worked on any given day will count towards the 90-day total.

Implications for Employers and Staffing Agencies

This legislative update and further guidance from the Illinois Department of Labor underscore the dynamic nature of labor laws and the importance of staying informed. Given the IDTLSA’s extensive requirements and private right of action as an enforcement mechanism, employers and staffing agencies must remain vigilant in understanding and complying with the law’s evolving requirements to avoid potential legal complications.