On February 3, 2022, the Illinois Supreme Court ruled in McDonald v. Symphony Bronzeville Park, LLC, [1] that the exclusivity provisions of the Illinois Workers’ Compensation Act (“Compensation Act”) do not preempt employees’ claims for statutory damages against their employers under the Illinois Biometric Information Privacy Act (“BIPA”). This long-awaited decision effectively nullifies the preemption defense under the Compensation Act and will only serve to bolster the onslaught of claims alleging technical violations of BIPA in the employment context.
Case background
In McDonald, the employee alleged, on behalf of herself and a putative class, that her former employer violated various provisions of BIPA by utilizing a biometric time-clock system that scanned employees’ fingerprints without (i) properly notifying them of the specific purpose and length of time for which their fingerprints were being collected, stored, and used; (ii) providing a publicly available retention policy, or (iii) obtaining their written consent to the fingerprint scans.
The Circuit Court of Cook County concluded that the employee could pursue her claims on behalf of the putative class, instead of through a claim before the Workers’ Compensation Commission, because the employee’s and putative class’s alleged injury was not one that “categorically fits within the purview of the [Compensation] Act.” The Illinois Appellate Court for the First Judicial District affirmed the Circuit Court’s decision, and the Illinois Supreme Court decided to hear the case to determine whether BIPA injuries are compensable under the Compensation Act, thus rendering civil lawsuits for such injuries barred by the Compensation Act’s exclusivity provision.
The Illinois Supreme Court’s decision agreed with the First District’s decision, holding that alleged privacy injuries in claims for statutory damages under BIPA are “not compensable”, primarily because they cannot be characterized as either psychological or physical work injuries. McDonald, 2022 IL 126511, 12, 2022 WL 318649, *3 (Feb. 3, 2022) (citing Treadwell v. Power Solutions International, Inc., 427 F. Supp. 3d 984 (N.D. Ill. 2019)). Accordingly, the exclusivity provision in the Compensation Act does not bar such claims.
Impacts to employers
Before the Illinois Supreme Court’s decision, the Compensation Act was one of the last major defenses available to employers defending BIPA claims. Aside from largely making this defense unavailable, McDonald has significant implications for the BIPA litigation landscape and employers defending BIPA claims.
- Expect plaintiffs’ attorneys to capitalize on the McDonald decision in settlement negotiations. With the Compensation Act defense largely off the table, the plaintiffs’ bar will likely take a harder stance with employers. That said, BIPA litigation is very much still a factual dispute that may only be determined after discovery or trial. While no employer wants to risk a potentially ruinous damage award, findings of fact could carve out new defenses and there’s often no quick path to judgment for plaintiffs.
- The Illinois Supreme Court is set to rule on two more common BIPA defenses in the coming months – the applicable statute of limitations and when BIPA claims accrue.
- The Court agreed to hear an appeal on the Tims v. Black Horse Carriers (App. No. 1-20-0563) decision, where the First District held that a one-year limitations period applies to claims under BIPA Sections 15(c) and (d) (relating to unlawful sales or disclosures of biometric information), but a five-year limitations period applies to claims under BIPA Sections 15(a), (b), and (e) (relating to required policies, disclosures, and consents prior to collection of biometric information, as well as use of proper security in storing or transmitting such information). With most BIPA claims from employees centered on Sections 15(a) and (b), the Illinois Supreme Court – for better or for worse – is at least posed to finally resolve the statute of limitations for BIPA claims.
- Acting on a certified question from the Seventh Circuit in Cothron v. White Castle System, Inc., 20 F.4th 1156 (7th Cir. 2021), the Court is also set to decide whether BIPA claims under Sections 15(b) and 15(d) accrue only once upon the initial collection or disclosure of biometric information, or every time biometric information is collected or disclosed. This decision could have significant implications for the amount of damages available to BIPA litigants and a statute of limitations defense.
Ryan Gehbauer, Libby Casale and Dremain Moore are associates in Thompson Coburn’s Business Litigation group.
Sources:
Ill. Justices Say Workers' Comp Law Doesn't Bar BIPA Claims - Law360
McDonald v. Symphony Bronzeville Park, LLC, 2022 IL 126511 (law360.com)