Justia Labor & Employment Law Opinion Summaries

Mroczko was employed by A&R as a custodian in a building where Pepper was performing maintenance work. Pepper's subcontractor, Perez, was replacing the carpets. While Mroczko was cleaning, a desk that had been placed in an upright position fell and injured her. Mroczko filed a successful workers’ compensation claim against A&R but failed to file a timely personal injury action. A&R filed a subrogation action. The Workers’ Compensation Act. 820 ILCS 305/5(b), permits an employee to file her own personal injury action against a third-party tortfeasor to recover damages for a work injury. The employer is entitled to reimbursement of its workers’ compensation benefits out of the proceeds obtained by the employee and has a limited right to intervene to protect its workers’ compensation lien. If the employee fails to file her own action, the employer may file the same action that the employee could have filed. The statute is silent as to whether an employee has the right to intervene in the employer's action. While A&R’s litigation was pending, Mroczko filed her own personal injury action, which was dismissed as barred by the two-year statute of limitations. Mroczko filed an amended complaint against Pepper only, alleging that her injuries arose out of Pepper’s construction work so that her action was timely under the four-year construction statute of limitations. The court dismissed the action. Mroczko then sought to intervene in A&R’s subrogation action. The circuit court denied that petition, citing res judicata. The Illinois Supreme Court agreed. Whether Mroczko had an interest in A&R’s action based on A&R’s pursuit of damages, including for her pain and suffering, is irrelevant to res judicata, which applies because Mroczko previously asserted the same claim against the same defendant, which resulted in a final judgment on the merits. View "A&R Janitorial v. Pepper Construction Co." on Justia Law

In 2012, then-Governor Quinn nominated Gregg to be a salaried member of the Illinois Prisoner Review Board (IPRB). Gregg submitted a statement of economic interests for the preceding calendar year, indicating that in 2011, he was mayor of Harrisburg. Asked to identify any gift valued over $500 and its source, Gregg wrote “None.” At the time, Gregg was recovering from an illness. Gregg did not complete a statement of economic interests for calendar year 2012. In 2013, Gregg resigned as mayor of Harrisburg. A former Harrisburg city treasurer notified the Illinois Department of Corrections that Gregg failed to include in his statement of economic interests a medical lift chair received as a gift. IPRB legal counsel investigated; neither the IPRB nor the Governor’s office took further action. In November 2013, the Illinois Senate approved Gregg’s appointment for a six-year term. In 2014, Gregg filed a Chapter 13 bankruptcy petition. Governor Rauner took office in 2014 and removed Gregg from the IPRB based on his misstatements and omissions on the statement of economic interest and his bankruptcy petition. The circuit court found that Gregg’s removal was judicially reviewable and determined that Rauner wrongfully terminated Gregg’s appointment.The Illinois Supreme Court disagreed, holding that Rauner’s decision to remove Gregg from the IPBR was not subject to judicial review. The Illinois Constitution, article V, section 10 provides: “The Governor may remove for incompetence, neglect of duty, or malfeasance in office any officer who may be appointed by the Governor.” The IPRB is not one of those rare agencies whose functions require complete independence from gubernatorial influence. View "Gregg v. Rauner" on Justia Law

Plaintiffs, participants in public pension funds, sued, challenging the constitutionality of three reforms in Public Act 97-651, which altered articles 8, 11, and 17 of the Illinois Pension Code (40 ILCS 5/8, 11, 17) and modified the calculation of annuities. The circuit court invalidated two provisions eliminating the right to earn union service credit for leaves of absence beginning after the amendments' effective date as violating the Illinois Constitution's (Ill. Const. 1970, art. XIII, 5) pension-protection clause but upheld the constitutionality of the third reform. The Illinois Supreme court affirmed regarding the elimination of the right to earn service credit for a union leave of absence; for participants who were already members on the Act's effective date, the ability to earn service credit on leave of absence for labor organization employment is a "benefit" that "cannot be diminished or impaired." The court reversed the dismissal of a claim that the change in the law to deny the use of a union salary under section 8-226(c) or 11-215(c)(3) to calculate the “highest average annual salary” violate the pension clause. The court also reversed the rulings on the that resulted from the circuit court’s construction of section 8-226(c)(3) to include defined contribution plans within the definition of “any pension plan.” View "Carmichael v. Laborers' & Retirement Board Employees' Annuity & Benefit Fund of Chicago" on Justia Law

The Bartonville police department’s union contract includes a grievance procedure. The Union may refer the grievance to arbitration if it is not settled within the three-step procedure. In 2014, Chief Fengel signed a complaint for termination, alleging that Lopez violated department procedures during a traffic stop. After scheduling a hearing by the board of fire and police commissioners, Lopez sought a declaratory judgment, arguing that the board was divested of jurisdiction because it had failed to commence the hearing within the 30-day time limit under Municipal Code 10-2.1-17. The board responded that it did so at Lopez’s request. The appellate court affirmed summary judgment in favor of the board. The hearing had proceeded, with counsel stating that Lopez did not waive the issue of jurisdiction and that the Union’s presence did not waive its contractual right to grieve the termination. The board ordered termination. Lopez never sought judicial review under the Administrative Review Law, but filed a grievance. When the grievance was not resolved by the three-step process, the Union referred it to arbitration. The Department sought a stay, arguing that in relying on the Municipal Code, Lopez essentially admitted that the board had jurisdiction. Because the board issued a final merits decision, review was subject to the Administrative Review Law. The Department also argued that the grievance and arbitration provisions in the labor contract did not apply to termination proceedings because the parties did not negotiate an alternative form of due process in the labor contract. The trial court granted the Department summary judgment, finding no contract provision, “even inferring, that the grievance procedure should, or could, be used to determine disciplinary matters.” The appellate court reversed. The Illinois Supreme Court reinstated the trial court decision, finding the grievance barred by waiver and res judicata. View "The Village of Bartonville v. Lopez" on Justia Law

Beggs, a tenured teacher, was dismissed from her employment by Murphysboro Community Unit School District. Caring for her parents, Beggs had accrued several absences and was tardy several days. She had received a “letter of concern” and a “remedial warning,” had taken sick leave, and had been suspended before her termination. Beggs requested a hearing, Illinois School Code, 105 ILCS 5/24-12. A hearing officer issued findings of fact and recommended that Beggs be reinstated with back pay and benefits because the Board failed to prove by a preponderance of the evidence that she had violated the notice of remedial warning or that she had engaged in irremediable conduct that constituted grounds for dismissal. The Board nonetheless dismissed her. The circuit court ordered Beggs reinstated with back pay and benefits. The appellate court affirmed. The Illinois Supreme Court affirmed. While the Board’s frustration with Beggs before the notice of remedial warning was “understandable and well documented,” it was unclear from the Board’s decision whether it would have found cause for discharge based on a tardiness incident of March 19, 2012, alone. Only a clear and material breach of the warning notice that was causally related to her past deficiencies would support dismissal. That single incident was not a clear and material breach of the warning notice. The court expressed “a definite and firm conviction that a mistake has been committed.” View "Beggs v. Board of Education of Murphysboro Community Unit School District No. 186" on Justia Law

Bayer, an ironworker with Area Erectors, which was hired by Garbe to build Panduit’s warehouse facilities, fell and is now quadriplegic. Bayer filed a claim against Area under the Workers’ Compensation Act (820 ILCS 305/1). Area began making temporary total disability payments and payments for Bayer’s medical expenses. Bayer also sued Panduit, Garbe, and a structural engineering company for negligence. Panduit and Garbe sued Area under the Joint Tortfeasor Contribution Act (740 ILCS 100/0.01). Bayer's settlement with Area was approved, so Area was discharged from contribution liability. Other claims were resolved, leaving only Bayer’s action for negligence against Panduit. Judgment ($64 million) was entered in Bayer’s favor. Under the Workers’ Compensation Act (820 ILCS 305/5(b)), Area was entitled to recover out of that judgment the amount of compensation it paid or would pay to Bayer, including amounts paid or to be paid under the Act for medical expenses, vocational rehabilitation, and temporary partial disability benefits. The court suspended future workers’ compensation payments. The Act provides that where, “the services of an attorney at law of the employee . . . have . . . substantially contributed to the procurement ... of the proceeds out of which the employer is reimbursed, then, in the absence of other agreement, the employer shall pay such attorney 25% of the gross amount of such reimbursement,” 820 ILCS 305/5(b), so Bayer’s lawyers were entitled to fees equal to 25% of the amount Area had paid for lost wages, medical expenses, and other compensable items before payments were suspended. Building on its 1990 holding that the gross amount of reimbursement subject to attorney fees includes both benefits paid before the third-party recovery and the amount of such benefits the employer will be relieved from paying in the future by reason of the third-party action, the Illinois Supreme Court held that the value of future medical care should be included in this calculation. View "Bayer v. Panduit Corp." on Justia Law

After the 2004 collective bargaining agreement (CBA) between the Unions and the Chicago Transit Authority (CTA) expired, the retiree health care benefits were the subject of an interest arbitration award. That award, which modified the retiree health care benefits, was accepted by the CTA and the Unions. Current and retired employees who had begun work with the CTA before 2001 challenged that award in a putative class action, asserting breach of contract, promissory estoppel, breach of fiduciary duty, and that the arbitration award was unenforceable under article XIII, section 5, of the Illinois Constitution, the “pension protection clause.” The circuit court ruled that the retired CTA employees had standing to challenge the modifications to their retiree health care benefits, but current CTA employees lacked standing, then dismissed for failure to state a claim. The appellate court agreed that current employees lacked standing but held that the retirees had a vested right to receive the health care benefits that were provided in the prior CBA and had stated claims for breach of that contract and for promissory estoppel. The Illinois Supreme Court held that plaintiffs who retired before the effective date of the 2007 CBA had standing; other retirees and current employees lacked standing. Dismissal of the claim for promissory estoppel against the CTA was proper; the complaint stated claims for breach of contract and under the pension protection clause. View "Matthews v. Chicago Transit Auth." on Justia Law

In 2005, plaintiff, a Carbondale police officer, struck the top of his head on the door of his squad car, causing him to “see stars” and experience a sharp pain in his arm, with no abrasions or blood loss. Plaintiff never returned to work. In 2007, plaintiff sought a line-of-duty disability pension (40 ILCS 5/3-114.1). The Board found that plaintiff’s disability was not the result of an on-duty injury and that plaintiff was not unable to return to work. The trial court reversed. The appellate court affirmed. In 2012, the city began providing plaintiff and his family with health insurance coverage. After a 2012 examination, the physician concluded that plaintiff was able to return to work. The Board terminated plaintiff’s disability pension. Plaintiff responded that he had not received notice of the meeting where the Board had voted to terminate his benefits. The circuit court affirmed, without addressing plaintiff’s due process claim. The city notified plaintiff that his insurance coverage would be terminated. The circuit court denied plaintiff a permanent injunction with respect to the insurance. The appellate court reversed that denial and the pension termination, finding that the Board had violated plaintiff’s due process rights by voting without notice or a proper hearing, but did not address whether the determination that plaintiff was no longer disabled was against the manifest weight of the evidence. The Illinois Supreme Court reinstated the denial of an injunction with respect to insurance coverage. Plaintiff’s injury did not result from one of the conditions in the Public Safety Employee Benefits Act (820 ILCS 320/10), such as responding to an emergency; he did not demonstrate a clear and ascertainable right in need of protection and was not entitled to a permanent injunction View "Vaughn v. City of Carbondale" on Justia Law

AFSCME represents approximately 40,000 state employees working in executive agencies. In 2008, AFSCME and the state negotiated a collective bargaining agreement effective through June 2012, providing for a general wage increase on January 1, 2009, and thereafter on every July 1 and January 1. Individual increases varied, but totaled 15.25%. A 4% increase was scheduled for July 1, 2011. In 2010, facing declining state revenues and the potential layoff of 2,500 state employees, AFSCME and the state agreed to $300 million in cost savings, including deferring the July 2011 increase; a 2% increase would be implemented on July 1, 2011, with the remaining 2% to be implemented on February 1, 2012. After adoption of the fiscal 2012 budget, the Department of Central Management Services notified agencies and labor relations administrators that, due to insufficient appropriations, the wage increase could not be implemented in 14 agencies. In arbitration, the state argued that the Public Labor Relations Act mandates that executive branch expenditures under a CBA are contingent on corresponding appropriations by the General Assembly, that this provision restates the mandate of the Illinois Constitution appropriations clause, and that it was incorporated into the CBA by the statement that “the provisions of this contract cannot supersede law.” The arbitrator issued an award in favor of AFSCME. The Illinois Supreme Court reversed the lower courts and vacated the award, holding that the arbitration award violates Illinois public policy, as reflected in the appropriations clause and the Public Labor Relations Act. View "Illinois v. Am. Fed'n of State, County & Mun. Employees, Council 31" on Justia Law

Illinois has four public pension plans for Chicago city employees; all subject to the pension protection clause of the Illinois Constitution: “Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.” The funds provide traditional defined benefit plans. As with state-funded pensions, for employees hired before 2011, annuity payments were subject to 3% automatic annual increases beginning after the member’s first full year of retirement, and compounded annually. For later-hires, the annuity adjustments were tied to the Consumer Price Index (CPI). Before Public Act 98-641, employees contributed 8.5% of their salary toward their pension. The city contributed based on a fixed multiplier, paid largely from property tax proceeds.The pensions were inadequate to cover benefits. The funds are on “a path of insolvency.” Public Act 98-641, effective in 2014, was based on a finding that financial crisis could not be addressed by increased funding alone. Under the Act, the city’s contribution progressively increases beginning in 2021; employee contributions are also increased. For two city funds, the Act: reduces the annual benefit increase to the lesser of three percent or half the annual unadjusted percentage increase in the CPI; removes the compounding component; eliminates increases in specific years, and postpones the initial increase. The Illinois Supreme Court found the Act unconstitutional. Nothing in the legislative process that led to its enactment constituted a waiver of members’ rights under the pension protection clause.Whether members may be “better off” under the Act is not for the General Assembly to decide unilaterally. View "Jones v. Mun. Employees' Annuity & Benefit Fund" on Justia Law