Justia Labor & Employment Law Opinion Summaries

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

Plaintiff was employed by American since 1988. On January 1, 2012, while working as a tower planner at O’Hare, plaintiff received a call from a friend at another airline, asking plaintiff to do something for a passenger who was scheduled to fly on American. Plaintiff requested that the catering department deliver a bottle of champagne and asked a flight attendant whether it would be possible to upgrade the passenger. The passenger was upgraded to first class. Plaintiff's employment was terminated because she upgraded the passenger and requested the champagne without proper authorization. American cited employee policies concerning dishonesty. Plaintiff applied for unemployment insurance benefits with the Department of Employment Security. American protested, alleging that plaintiff was ineligible because she was “discharged for misconduct connected with [her] work,” under the Unemployment Insurance Act, 820 ILCS 405/602(A). Following a hearing, a Department referee denied plaintiff’s application. The Board of Review affirmed. The circuit court reversed, finding that the actions which led to plaintiff’s discharge did not constitute “misconduct” under the strict statutory definition. The appellate court reversed. The Illinois Supreme Court reinstated the circuit court decision, finding no illegal or intentionally tortious conduct, nor evidence of a deliberate rule violation. View "Petrovic v. Dep't of Emp't Sec." on Justia Law

The Chicago Board of Education and the Teachers Union 2007-2012 collective bargaining agreement (CBA) established a grievance procedure that culminated in binding arbitration. In 2010, the Board notified the Union of a new policy: designating as ineligible for rehire probationary appointed teachers (PATs) who have been non-renewed twice, or have had an unsatisfactory performance rating. The Board began implementing this policy and notified PATs that they were being non-renewed, but did not inform them that it had placed a “do not hire” (DNH) designation in their personnel files. The Union presented grievances and demanded arbitration. The Board refused to arbitrate, claiming that Board hiring decisions were exclusive management rights. The Illinois Educational Labor Relations Act found that, under the Act and the CBA, the Board had a duty to arbitrate the DNH grievances and, by refusing, had violated 115 ILCS 5/14(a)(1). The appellate court reversed. The Illinois Supreme Court affirmed. PATs are employed for a single school-year; the Board alone is vested with selection of such employees as a matter of inherent managerial policy. The policy of placing a DNH designation in PAT files following two nonrenewals or an unsatisfactory performance rating was within the Board’s authority because it directly relates to its exclusive right to determine hiring guidelines. View "Bd. of Educ. of the City of Chicago v. Ill. Educ. Labor Relations Bd." on Justia Law

From 1966-1970, Folta was a shipping clerk and product tester for Ferro Engineering and was exposed to products containing asbestos. In 2011, Folta was diagnosed with mesothelioma, a disease associated with asbestos exposure. He sued Ferro, alleging negligence. Ferro moved to dismiss under ILCS 5/2-619(a)(9), arguing that the claimswere barred by the exclusive remedy provisions of the Workers’ Compensation Act (820 ILCS 305/5(a)) and the Workers’ Occupational Diseases Act (820 ILCS 310/5(a)). Ferro maintained that his action fell outside the exclusive remedy provisions because his claims were not “compensable” under the statutes: the symptoms did not manifest until more than 40 years after his last exposure to asbestos, and any potential asbestos-related compensation claim was barred under the 25-year limitation provision. The circuit court dismissed, holding that the action was barred by the exclusive remedy provisions. The appellate court reversed, reasoning that the term “compensability” must relate to the “ability to recover under the Act.” The Illinois Supreme Court reinstated the dismissal, noting that the acts do not prevent an employee from seeking a remedy against other third parties for an injury or disease and that Folta had also sued manufacturers. View "Folta v. Ferro Eng'g" on Justia Law