By Jennifer A. Riley, Andrew Scroggins, and Tyler Zmick

Seyfarth Synopsis: As we previously reported, employers generally have found success when the U.S. Supreme Court takes up questions about the arbitrability of workplace disputes. The unanimous decision in Southwest Airlines Co. v. Saxon bucks that trend, denying employers a clear victory and holding that those who load cargo onto airplanes engaged in interstate travel are exempt from the Federal Arbitration Act (FAA). The Court’s fact-specific decision, however, rejects any bright-line test based on the employer’s industry and allows for a worker-based inquiry.  As such, it leaves room for employers looking to enforce their arbitration agreements under federal law and opens the door to future litigation regarding whether workers are actually “engaged in interstate commerce” when they do not cross borders to perform their work.


Latrice Saxon worked at Midway International Airport in Chicago as a ramp supervisor for Southwest Airlines. She filed suit against the company in federal court, alleging that Southwest Airlines failed to pay overtime wages to Saxon and others. Saxon, however, previously had agreed to submit any disputes over wages to an arbitrator who would decide them in arbitration on an individual basis. Accordingly, the company moved to dismiss the lawsuit and to compel arbitration under the FAA.

Saxon resisted the motion to compel, arguing that her work placed her outside the scope of the FAA. More specifically, she cited Section 1 of the FAA, which provides that the statute does not apply to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”

The district court sided with Southwest Airlines, reasoning that ramp agents and supervisors are responsible for the handling of goods but not responsible for the transportation of those goods across state lines. The Seventh Circuit reversed that decision, holding that “[t]he act of loading cargo onto a vehicle to be transported interstate is itself commerce” as the term was understood when the FAA was enacted. The Seventh Circuit’s decision put it in conflict with an earlier decision by the Fifth Circuit, and the Supreme Court took the case to resolve the split.

What Did The Supreme Court Hold?

In a unanimous 8-0 decision (Justice Barrett recused), the Supreme Court agreed with the Seventh Circuit’s holding that ramp agents and supervisors who physically loaded cargo onto airplanes traveling across state lines are subject to the FAA’s transportation worker exemption.  Southwest Airlines Co. v. Saxon, 596 U.S. ___ (2022).

The Court reached its conclusion through a two-step analysis.  (Slip. Op. at 3.)  First, the Court defined “the relevant ‘class of workers’ to which Saxon belongs.”  Id.  Next, the Court “determine[d] whether that class of workers is ‘engaged in foreign or interstate commerce.’”  Id.

Defining the Relevant Class of Workers As “Airplane Cargo Loaders”

Saxon urged the Court to take an expansive view of this issue and to decide it based on her employer’s industry – air transportation. The Court expressly rejected this sweeping approach, noting that the FAA refers to “workers,” not “employees” or “servants,” which suggests that the scope of the exemption turns on the performance of work.

The Court held that this inquiry is not directed at the nature of the employer’s business but directed at the actual work that the members of the class typically carry out.  (Id. at 4.)  In other words, “Saxon is … a member of a ‘class of workers’ based on what she does at Southwest, not what Southwest does generally.”

The Court concluded from the record before it that Saxon and other ramp supervisors physically loaded and unloaded cargo on and off airplanes on a frequent basis.

Defining Whether “Airplane Cargo Loaders” Are Engaged in Interstate Commerce

The Court next considered whether the class of airplane cargo loaders to which Saxon belonged was “engaged in foreign or interstate commerce” and found its answer in a decision issued nearly a century ago:

We have said that it is “too plain to require discussion that the loading or unloading of an interstate shipment by the employees of a carrier is so closely related to interstate transportation as to be practically a part of it.” Baltimore & Ohio Southwestern R. Co. v. Burtch, 263 U. S. 540, 544 (1924). We think it equally plain that airline employees who physically load and unload cargo on and off planes traveling in interstate commerce are, as a practical matter, part of the interstate transportation of goods. They form “a class of workers engaged in foreign or interstate commerce.”

(Id. at 5.)  Applying that decision here, the Court concluded that “one who loads cargo on a plane bound for interstate transit is intimately involved with the commerce (e.g., transportation) of that cargo.”  (Id. at 6.)

Having concluded that “Saxon frequently loads and unloads cargo on and off airplanes that travel in interstate commerce,” the Court held that she satisfied the transportation worker exemption in Section 1 of the FAA.

The ruling does not disturb mandatory arbitration of certain types of disputes arising under collective bargaining agreements pursuant to the Railway Labor Act.

What About Other Classes of Workers?

While the Court agreed that “airplane cargo loaders” are engaged in interstate commerce, it acknowledged that the distinction may not always be clear:

We recognize that the answer [whether the class of workers are engaged in foreign or interstate commerce] will not always be so plain when the class of workers carries out duties further removed from the channels of interstate commerce or the actual crossing of borders.

(Id. at 5 n.2.)  While the Court did not offer a bright-line test to help draw such distinctions in the future, it provided a few guideposts.

First, the Court noted that, although the FAA does not define “transportation worker,” any such worker must at least be “actively engaged” in the “free flow of goods across borders” via the “channels of foreign or interstate commerce.”  (Id. at 6.)

Applying these criteria, the Court noted that cargo loaders exhibit these central features of a transportation worker because they “load[] cargo on a plane bound for interstate transit” and, when they engage in such activity, “there [can] be no doubt that [interstate] transportation [is] still in progress.”  (Id.)

Second, the Court offered some examples of work that would not satisfy the exemption. Citing Gulf Oil Corp. v. Copp Paving Co., 419 U.S. 186 (1974), it noted that workers who make intrastate sales of asphalt are not engaged in interstate commerce merely because the product is later used to build interstate highways. Similarly, citing United States v. American Building Maintenance Industries, 422 U.S. 271 (1975), the Court explained that workers who supply localized janitorial services to a corporation engaged in interstate commerce do not satisfy the exemption because they do not perform activities “within the flow” of interstate commerce.

In a footnote, the Court acknowledged that two Circuits recently issued divergent decisions involving workers who carried out duties “further removed from the channels of interstate commerce or the actual crossing of borders.”  (Slip Op. at 5 n.2.)  It referred to the Ninth Circuit’s decision finding “last leg” delivery drivers within Section 1’s exemption and the Seventh Circuit’s decision finding food delivery drivers outside Section 1’s exemption. Although its opinion appeared to signal its take on these holdings, the Court stated only that it “need not address those questions to resolve this case.”  Id.

Implications For Employers

Employers avoided the worst case scenario that some had feared — a holding that the transportation worker exemption applies to all employees who work for employers engaged in the transportation industry. Instead, the Court issued a fact-specific decision that focused on application of the transportation worker exemption to a worker directly engaged in loading cargo for transport across borders.

Companies should anticipate that other workers who are less directly involved in the flow of interstate commerce will attempt to invoke the exemption claiming that they, too, are exempt from the FAA. The burden of demonstrating that the “transportation worker” exemption applies falls to the worker, and the decision in Saxon provides employers ammunition for curtailing these arguments based the work “actually performed” as well as the connection of that work to the flow of goods across borders.

Somewhat ironically, the Supreme Court’s decision heightens the importance of state law in enforcing arbitration agreements of workers most connected to interstate transportation.  For those workers, the choice of state law will take on renewed emphasis as many states already have adopted uniform arbitration acts that do not contain transportation worker exemptions and others have a clear runway to legislate the enforceability of these agreements.

By Andrew L. Scroggins and Sarah K. Bauman

 Seyfarth Synopsis: As we previously reported here, last October the EEOC put employers on notice of an initiative to ensure that artificial intelligence (“AI”) and other technology used in hiring and employment decisions comply with federal anti-discrimination laws. Consistent with this recent initiative, on May 12, 2022, the EEOC shared guidance to help employers using AI technology to remain compliant with the Americans With Disabilities Act (“ADA”). The DOJ followed suit by posting similar guidance regarding AI-related disability discrimination on the same day.

These guides are an important read for employers who presently use — or are considering using — AI and other technological tools to increase efficiency in hiring and employment decisions.

The EEOC’s Guidance

Entitled the “Americans With Disabilities Act and the Use of Software, Algorithms, and Artificial Intelligence to Assess Job Applicants and Employees,” available here, the EEOC’s guidance discusses how existing ADA requirements may apply to the use of AI, software applications, and algorithms in employment-related decision-making processes and practices. The guidance also offers useful information and tips to employers in an effort to assist them with ADA compliance when using such tools.

Specifically, the EEOC explains how an employer’s use of AI and other technological tools can discriminate against disabled individuals within the meaning of the ADA, group the potential types of discrimination into three broad categories: (1) failing to reasonably accommodate an employee’s disability; (2) screening out qualified individuals with disabilities; or (3) posing “disability-related inquiries” or seeking information that qualifies as “medical examination,” before giving the candidate a conditional offer of employment. The guidance concludes by providing employers with promising practices to be followed when assessing job applicants and employees with AI tools.

The EEOC provides several examples of how the above three ADA violations could be implicated. For example, if an employer administers a test through computer software, it risks violating the ADA if it fails to offer extended time or an alternative version of a test, such as one that is compatible with accessible technology (like a screen reader) as a reasonable accommodation to those who need it on account of their disability. Similarly, employers may run afoul of the law if AI and other tools result in lower scores or assessment results for individuals with disabilities.

The EEOC recommends several promising practices for employers when using AI tools, such as: training staff to recognize and process requests for reasonable accommodations as quickly as possible; informing job applicants and employees that reasonable accommodations are available for individuals with covered disabilities; ensuring that AI tools only measure abilities or qualifications that are truly necessary for the job; and confirming, before purchase, with AI vendors that the AI tool does not ask individuals questions likely to elicit information about a disability.

The DOJ’s Guidance

Entitled “Algorithms, Artificial, and Disability Discrimination in Hiring,” the DOJ’s guidance, available here, similarly explains how algorithms and AI intelligence can lead to disability discrimination in hiring, particularly with respect to reasonable accommodations and screen-outs.

The DOJ’s guidance provides various examples of the types of technological tools that employers are using and the ways in which such tools can discriminate in failing to reasonable accommodate or screening out disabled applicants. The guidance also provides recommendations to employers on ADA-compliant practices, such as providing and implementing clear procedures for requesting reasonable accommodations.

Implications For Employers

From FY 2020 to FY 2021, ADA cases increased fairly significantly, and they now represent 36% of all charges filed with the EEOC. As these types of claims continue to rise, businesses should be aware of the specific ways in which technological advancements like AI tools can lead to disability discrimination charges and lawsuits. This is especially important for businesses that continue to grow — thereby requiring increased efficiency in the hiring process — in the midst of a global pandemic where remote work (and use of digital platforms) have become the norm.

By Gerald L. Maatman, Jr. and Sarah K. Bauman

Seyfarth Synopsis: In EEOC v. BNSF Railway Co., Case No. 8:21-CV-369 (D. Neb. April 28, 2022), Judge Brian C. Buescher of the U.S. District Court for the District of Nebraska denied the EEOC’s request for a temporary restraining order (“TRO”) to prevent alleged discriminatory conduct.  The EEOC sought an order reinstating an employee, Rena Merker, to work and prohibiting BNSF from engaging in retaliatory action against employees who seek to cooperate with the EEOC in its pending lawsuit against BNSF.  Though the District Court ultimately found that the EEOC failed to demonstrate the requisite factors for obtaining a TRO, this decision is important because of the focal basis for the District Court’s denial of the EEOC’s motion.  The District Court ruled that because the claim in the pending lawsuit was that Merker was subjected to a sexually hostile work environment, but the TRO request was based on alleged retaliation, it was impossible for the EEOC to demonstrate the likelihood of success factor necessary for relief.  Given this inconsistency, the EEOC’s motion failed on its face.  This case is a must-read for employers faced with EEOC-related litigation, as such an arguably basic flaw could serve as a critical defense to these types of motions.

Case Background

In BNSF, Merker, a train conductor, filed a charge of discrimination with the EEOC on January 18, 2018, alleging on behalf of herself and other aggrieved individuals in non-management positions that they had been subjected to a pattern and practice of gender discrimination, sexual harassment, sex discrimination, and retaliation for opposing such alleged discrimination and harassment.  Id. at *1-2.  On November 24, 2020, the EEOC issued a letter of determination stating that the EEOC had reasonable cause to believe that BNSF violated Title VII because Merker and other female employees were subjected to harassment and Merker was disciplined for complaining about the alleged harassment.  Id. at *2.  The EEOC was unable to reach a conciliation agreement with BNSF.  Id.

On September 23, 2021, the EEOC sued BNSF under Title VII on behalf of Merker and other aggrieved individuals adversely affected by similar conduct, but amended its complaint on December 20, 2021, alleging that Merker has been harassed by coworkers’ sexual and demeaning comments and other conduct.  Id.  The amended complaint further alleges that BNSF’s supervisors and human resources personnel turn “blind eye” to harassment, but does not assert  a claim of retaliation on behalf of Merker or other aggrieved individuals.  Id.  On April 15, 2022, the District Court granted in part and denied in part BNSF’s motion to dismiss, finding that the EEOC stated a plausible claim for sexual work environment on behalf of Merker, but failed to do so on behalf of the other aggrieved individuals.  Id. 

While the motion to dismiss was pending, BNSF terminated Merker for alleged attendance issues.  Id.  Before the District Court entered the above-mentioned decision on the motion to dismiss, the EEOC filed a TRO request with the District Court to immediately reinstate Merker’s position and from retaliating against female employees from cooperating with the EEOC in the pending lawsuit.  Id. 

The District Court’s Decision

The District Court denied the EEOC’s motion.  At the outset of its analysis, the District Court held that the EEOC could not prevail on its motion because the amended complaint in the pending lawsuit did not state a claim for retaliation — the very basis for its request for a TRO.  Citing Carson v. Simon, 978 F.3d 1051, 1059 (8th Cir. 2020), the District court explained that while no single factor of the TRO analysis is determinative, the “probability of success factor is the most significant.”  Id. at *15-16.  “This factor requires the movant to demonstrate at least a fair chance of prevailing,” or an “adequate showing of a nexus between the unlawful conduct and the responsible individuals.”  Id. at *16 (citations and quotations omitted).  Critically, the District Court observed that the likelihood of success “is considered in light of the elements of the movant’s claim.”  Id.  In BNSF, the EEOC argued in support of its request for a TRO only that it is likely to succeed in proving BNSF terminated Merker in retaliation for the EEOC’s lawsuit based on her charge of discrimination.  That claim, however, is missing from the amended complaint — which only alleges hostile work environment — and therefore could not substantiate the crucial factor (likelihood of success) of its TRO request.

The District Court nevertheless evaluated the merits of the EEOC’s TRO motion and found that it failed to show irreparable harm because the EEOC failed to demonstrate an emergency, a TRO would be unlikely to preserve the status quo, and the EEOC failed to demonstrate irreparable harm from Merker’s termination.  Specifically, the District Court found the EEOC’s attempted bureaucratic excuse for failing to file the TRO for more than two weeks unavailing: “If the EEOC wishes to file TRO actions, it must comply with the law to do so.  This means it must find a way to timely file a TRO, just as any other party must do . . . .”  Id. at *20.  Further, the District Court held that the EEOC’s request for relief was not proper preliminary injunctive relief, but rather affirmative relief — reinstatement of Merker’s position.  Id. at *21.  Lastly, the District Court found a lack of irreparable harm from Merker’s termination because the EEOC failed to offer sufficient evidence supporting a “but for” connection between the EEOC lawsuit and her termination.  Id. at *22.  Rather, the evidence offered by BNSF demonstrated a rich disciplinary record relative to Merker which BNSF argued was the cause of her termination, and the EEOC failed to offer sufficient evidence to suggest otherwise.

Implications For Employers

Employers faced with TROs should be mindful of BNSF because it highlights a rather basic defense that could be overlooked when scrambling to defend these motions under strict time-constraints.  In BNSF, the District Court rejected the EEOC’s attempt at obtaining immediate relief for something that, though related to the underlying lawsuit, was not specifically alleged in the pending complaint.  When the EEOC or other plaintiff files a TRO, employers and their attorneys should first look to whether the operative complaint specifically alleges the claim that provides the underlying basis for the TRO.  If there is an inconsistency in such respect, employers should rely on BNSF in arguing that the motion should be denied.

By Jennifer A. Riley, Alex W. Karasik and Tyler Z. Zmick

Seyfarth Synopsis:  In Sosa v. Onfido, Inc., No. 20-CV-4247, 2022 U.S. Dist. LEXIS 74672 (N.D. Ill. Apr. 25, 2022), the Court issued the latest plaintiff-friendly decision under the Illinois Biometric Information Privacy Act (“BIPA”), putting businesses and employers on notice that the statute can apply to photographs in addition to the typically-alleged facial and hand scans.  The Court denied the Defendant’s motion to dismiss on the basis that: (1) photographs and information derived from photographs are protected by BIPA; (2) Plaintiff sufficiently plead a claim for liquidated damages; and (3) the BIPA does not violate the First Amendment. 

Case Background

Plaintiff filed suit alleging that the Defendant markets and sells proprietary facial recognition software that is used by online businesses to verify consumers’ identities.  Id. at *2.  To verify a consumer’s identity, the consumer first uploads a copy of his or her identification and a facial photograph.  Id.  The software then scans the identification and photograph to locate the facial images on each document; extracts a unique numerical representation of the shape or geometry of each facial image, which is often called a ‘faceprint,” compares the faceprints from the consumer’s identification and photograph; and generates a score based on the similarity of the faceprints.  Id.  The software also can compare the faceprints obtained from a consumer’s identification or photograph with other biometric data in Defendant’s database, such as the biometric data of known masks or other consumers’ photographs.  Id. at *2-3.  Online businesses can integrate the software into their products and mobile apps in such a way that consumers seeking to verify their identities likely do not know that they are interacting with and providing their sensitive information to Defendant, a third party.  Id. at *3.

Plaintiff was a member of an online marketplace that partnered with Defendant to verify its users’ identities using Defendant’s software.  Id.  Plaintiff claimed that, in April 2020, Plaintiff verified his identity in the online marketplace and that Defendant allegedly used its software to scan Plaintiff’s face, extract his faceprints, compare the two photographs, and then Defendant kept his unique faceprint in a database and accessed it every time another person used Defendant’s verification process.  Defendant purportedly did not inform Plaintiff that it would collect, store, or use his biometric identifiers derived from his face,” and Plaintiff never signed a written release allowing Defendant to do so.  Id. at *3-4.

Plaintiff filed suit against Defendant in the Circuit Court of Cook County, Illinois, alleging that it violated the BIPA, 740 Ill. Comp. Stat. 14/1 et seq., seeking to represent himself and a putative class of Illinois residents “who had their biometric identifiers or biometric information, including faceprints, collected, captured, received, otherwise obtained, or disclosed by Defendant while residing in Illinois.”  Id. at *4.  Defendant removed the lawsuit based on diversity jurisdiction and the Class Action Fairness Act (“CAFA”).  Id. at *5.  After the Court denied Defendant’s motion to compel arbitration (and the Seventh Circuit affirmed), Defendant moved to dismiss on the grounds that: (1) Plaintiff did not state a viable claim under the BIPA because the information Defendant allegedly collected — photographs and information derived from photographs — is not protected by the BIPA; (2) Plaintiff failed to adequately state a claim for liquidated damages; and (3) the BIPA violates the First Amendment.

The Court’s Decision

The Court denied Defendant’s motion to dismiss on all three grounds.

The BIPA’s Application To Data Derived from Photographs

The Court first addressed the argument that Plaintiff failed to state a claim under the BIPA because Defendant’s software captured information from user-submitted photographs, and neither photographs nor information derived from photographs are covered by the BIPA.  The Court’s analysis turned on Section 10 of the BIPA, which defines “biometric information” and “biometric identifier” and also lists items that do not fall under those definitions — specifically, “biometric identifiers do not include photographs, and biometric information ‘does not include information derived from items or procedures excluded under the definition of biometric identifiers.’”  Mem. Op. & Order at 11 (quoting 740 ILCS 14/10).  The Court acknowledged that data derived from photographs is not “biometric information,” but it held that data derived from photographs in the form of “scans of face geometry” can constitute biometric identifiersId. at 11-12 (“As alleged . . ., [defendant’s] software scans identification cards and photographs to locate facial images and extracts a unique numerical representation of the shape or geometry of each facial image, which [plaintiff] refers to as a ‘faceprint.’  The faceprints extracted by [defendant] plausibly constitute scans of face geometry and, therefore, ‘biometric identifiers’ under BIPA.”) (internal citations omitted).

The Court rejected the argument that the data cannot be a “scan of face geometry” because it did not involve the scan of plaintiff’s “actual face, but rather, a scan of a photograph of his face,” holding that “[n]othing in the BIPA’s text . . . supports [defendant’s] contention that a scan of face geometry must be an ‘in person’ scan.”  Id. at 14 (citation omitted).

Request For Liquidated Damages

The Court next turned to Defendant’s argument that Plaintiff’s request for liquidated damages should be dismissed because he failed to allege facts from which it reasonably could be inferred that Defendant negligently, recklessly, or intentionally violated BIPA.  The court held that Plaintiff need not plead Defendant’s state of mind to allege a BIPA claim and that dismissing Plaintiff’s request for liquidated damages was unwarranted because the request sought a particular remedy (which is “distinct from [plaintiff’s] underlying claim for relief based on BIPA”).  Id. at 18.

BIPA authorizes a prevailing party to recover, inter alia, the greater of actual damages or $1,000 in liquidated damages for each negligent BIPA violation and the greater of actual damages or $5,000 in liquidated damages for each intentional or reckless BIPA violation.  740 ILCS 14/20(1), (2).  Importantly, Plaintiff sought not only liquidated damages but also injunctive relief and relief in the form of reasonable attorneys’ fees, costs, and expenses — the latter forms of relief having no associated mental state requirement.  See Mem. Op. & Order at 19-20 (“Nor does [plaintiff] need to allege facts suggesting any level of culpability to plausibly state a BIPA claim in the first place,” as “[Plaintiff] may obtain injunctive relief or attorneys’ fees — as he has requested — regardless of whether [Defendant’s] actions are proven to be negligent, reckless, or intentional.”).

First Amendment

Finally, the Court addressed the argument that BIPA Section 15(b) — which requires a private entity to obtain informed consent before collecting an individual’s biometric data — violates the First Amendment as applied by restricting Defendant’s speech and its collection of “ information voluntarily provided by consumers to identify themselves as marketplace users.”  Id. at 24.  The court held that (1) Section 15(b) does not restrict defendant’s speech (meaning the First Amendment does not apply), and (2) even if Section 15(b) restricted defendant’s speech, it is a content-neutral restriction that survives the applicable level of First Amendment scrutiny (i.e., intermediate scrutiny).

In holding that Section 15(b) does not regulate Defendant’s speech, the Court reasoned that Section 15(b) “does not prohibit or otherwise restrict what a private entity may do with an individual’s biometric data once the data is obtained”; instead, Section 15(b) “regulates [D]efendant’s ability to obtain an individual’s biometric data by requiring [Defendant] to acquire the individual’s informed consent before doing so.”  Mem. Op. & Order at 24.  The Court relied on Dahlstrom v. Sun-Times Media, LLC, 777 F.3d 937 (7th Cir. 2015), where the Seventh Circuit held that the Driver’s Privacy Protection Act’s (the “DPPA”) “prohibition on obtaining information from driving records” did not restrict speech because it limited only “access to information.”  Mem. Op. & Order at 24 (citation omitted).  Sosa reasoned that “[l]ike the DPPA provision at issue in Dahlstrom, Section 15(b) burdens a party’s ability to access certain information.”  Id. at 25.

The Court further held that, even if Section 15(b) restricted Defendant’s speech, it would nonetheless survive intermediate scrutiny under the First Amendment.  The Court applied the four-prong intermediate scrutiny test set forth in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980): [1] First, courts ask whether the commercial speech concerns unlawful activity or is misleading (if so, the speech is not protected by the First Amendment); [2] if the speech concerns lawful activity and is not misleading, courts next ask whether the asserted governmental interest is substantial; [3] if it is, then courts determine whether the regulation directly advances the governmental interest asserted; and [4] finally, courts ask whether the regulation is more extensive than necessary to serve that interest.

Regarding the first step, the Court held that the at-issue commercial speech does not concern unlawful activity and is not misleading because Section 15(b) “regulates both the misleading and non-misleading collection of biometric data.”  Mem. Op. & Order at 31.  But the Court held that Section 15(b) passes muster under steps (2) through (4).  At the second step, the Court determined that Section 15(b) is supported by a substantial governmental interest — namely, the interest in protecting consumers’ rights to privacy in and control over their biometric data.  At the third step, the Court held that Section 15(b) directly advances the government’s interest because the harms identified by the Illinois legislature are real and Section 15(b) alleviates those harms “to a material degree.”  Id. at 33.  Finally, the court held that Section 15(b) is not more extensive than necessary to serve the government’s interest, as: (1) Section 15(b) “does not outright prohibit companies . . . from obtaining biometric data; it merely requires them to obtain informed consent before doing so”; and (2) “it is not too onerous to require a company that wants to collect a consumer’s sensitive and immutable biometric data to obtain the consumer’s consent before doing so.”  Id. at 35.


Sosa is one of several recent plaintiff-friendly BIPA decisions, and it reinforces the unanimous interpretation among courts to date that the BIPA can apply to data derived from photographs.  The Sosa decision also seemingly tends to undermine the defense argument that a BIPA plaintiff must allege facts demonstrating negligence, recklessness, or intent to state a claim and request liquidated damages under the statute.

Significant questions remain, however, regarding the BIPA’s application to companies that collect biometric information.  For one, the Court’s First Amendment analysis regarding Section 15(b) suggested that the same analysis might lead to the conclusion that claims brought under Sections 15(c) and/or 15(d) (which prohibit (i) profiting from biometric data and (ii) disclosing biometric data without consent, respectively) do violate the First Amendment.  See Mem. Op. & Order at 27 (noting that statutory provisions restricting the sale, disclosure, and use of information “undoubtedly restrict[] speech”).  Other important questions will be decided in appeals pending before the Illinois Supreme Court, including the question whether claims asserted under Sections 15(b) and 15(d) accrue only once upon the initial collection or disclosure of biometric information, or each time a private entity collects or discloses biometric information (see here), and the limitations period applicable to BIPA claims.

By Gerald L. Maatman, Jr., Christopher J. DeGroff, Alex W. Karasik, and Sarah K. Bauman

Seyfarth Synopsis:  On March 28, 2022, the EEOC released its fiscal year 2023 budget justification (see here) and fiscal year 2021 performance report (“APR”) (see here).  The APR is a “report card” analysis of the EEOC’s litigation goals and performance results from FY 2021, while the FY 2023 budget outlines how the Commission intends to allocate funds in order to effectuate those goals, in the context of its proposed FY 2023 budget of $464,650,000.

These publications are exceedingly important to employers, as they contain must-read data points for employers in regards to the EEOC’s future strategic objectives and potential targets of heightened enforcement activity.

FY 2021 APR

 In the APR, the EEOC declared that FY 2021 was a successful year for the Commission in terms of advancing its strategic objectives.  In touting its achievements, the EEOC secured more than $485 million in monetary relief for over 15,000 alleged victims of employment discrimination, resolved 138 merit lawsuits, achieved a “favorable result” in 95.7% of all district court resolutions, and secured a reduction of 9.1% in the aged inventory in federal sector appellate cases.

The EEOC often uses this report to undergird its requests for budget increases and to document its achievement. By comparison, the EEOC recovered $535.5 million in FY 2020, $486 million in FY 2019, and $505 million in FY 2018.

The EEOC also continued its goals in community outreach, education, and technical assistance by – despite the challenges of the pandemic – conducting 460 outreach events and reaching 27,495 small business representatives.  Commissioner Burrows, the Chair of the EEOC, remarked that the success of 2021 was made possible “through efforts to rebuild and strengthen the agency,” as it was “fortunate to hire more than 450 predominately front-line positions to begin replacing staff departures in recent years, thereby strengthening our ability to fulfill the agency’s vital role in preventing and remedying employment discrimination.”

FY 2023 Budget Justification

Moving into 2023, the EEOC justifies its $464,650,000 budget request — a whopping $60.160 million increase from last year — based on advancing the strategic priorities for the fiscal year.  Commissioner Burrows indicated that such priorities correlate with the Biden Administration’s call for a “whole-of-government approach to addressing systemic discrimination and advancing equal opportunity.”  Having a “critical role in achieving that agenda,” the EEOC plans to focus on “three broad areas,” including racial justice and systemic discrimination of all protected bases, pay equity, and the civil rights impact of the COVID-19 pandemic.  Of that $464,650,000, the EEOC requested $31.5 million for state, local, and tribal programs.

Commissioner Burrows further indicated that the proposed budget also will help advance three initiatives launched in 2021, including the Hiring Initiative to Reimagine Equity (HIRE), which aims to expand employment opportunities as the nation recovers from the pandemic; a joint anti-retaliation initiative with the U.S. Department of Labor and the National Labor Relations Board; and an initiative to ensure that employment-related artificial intelligence and algorithmic decision-making tools comply with federal civil rights laws.

Implications For Employers

FY 2021 was a year of change and recovery at the EEOC as a result of the pandemic and new leadership.  Now that the new leadership regime and their structural changes settled in and adapted to a country that remains impacted by the lingering global pandemic, companies find themselves facing continued uncertainty in the employment landscape.  Given that the EEOC will be equipped with a vastly increased proposed budget, it is more crucial than ever for employers to take heed in regards to the EEOC’s strategic priorities and enforcement agendas.

We will continue to monitor these changes closely and keep readers informed of any further developments as we continue into this new year.

By Gerald L. Maatman, Jr., Jennifer A. Riley, and Sarah K. Bauman

Seyfarth Synopsis: In Allen et al. v. AT&T Mobility Services, LLC, Case No. 1:18-CV-03730 (N. D. Ga. March 21, 2022), Plaintiffs alleged that AT&T, their former employer, discriminated against them and other pregnant sales associates with how it designed and implemented its attendance policies and related discipline system.  Plaintiffs filed suit seeking damages and an injunction against these practices pursuant to Title VII of the Civil Rights Act of 1964 (“Title VII”), as amended by the Pregnancy Discrimination Act (“PDA”), 42 U.S.C. 2000e et seq.  Plaintiffs brought a motion for class certification, which the Court denied on the basis that individualized inquiries were necessary to determine whether AT&T’s policies caused harm and/or damaged any potential Plaintiff, such that resolution of their claims on a class-basis would be impractical.  This case is a must-read for employers facing class action discrimination claims and another addition to the emerging and developing law of pregnancy discrimination. 

Case Background

In Allen, the named Plaintiffs filed a putative class action alleging that AT&T discriminates against its non-managerial pregnant employees by implementing an absence policy (“SAG”) that disparately impacted such employees.  Id. at 3.  Under the SAG, unexcused absences garnered points, and discipline would follow from the imposition of those points.  After accruing three to four points, retail workers become subject to progressive disciplinary action.  The SAG and associated discipline policies operated without discretion to ensure consistency in attendance and discipline practices in all AT&T retail stores nationwide.  Id.

Not all absences accrue points.  The SAG policy delineates 13 categories of “excused” absences, such as leave under the Family and Medical Leave Act (“FMLA”), military leave, approved short term disability, and approved job accommodations.  Id. at 5.  Employees must request time off through an app at least one hour prior to their scheduled shift.  The app requires employees to select a reason for the absence from various options, none of which include pregnancy.  Id. at 6.

Employees may request excused absences due to their pregnancy or pregnancy-related conditions under the FMLA, and short term disability or approved job accommodations.  While the FMLA includes incapacity due to pregnancy and prenatal care, it also requires employees to have worked at least 1,250 hours of service.  Further, under AT&T’s short term disability policy, employees are required to submit their claims, including medical evidence, to a third-party for consideration and the policy does not cover medical conditions that do not rise to the level of a disability.  The same limitations apply to approved job accommodations leave, which is available only to those with disabling conditions.  Id.  Thus, the essence of Plaintiffs’ claims was that AT&T disproportionately burdens pregnant employees compared to other employees to establish a basis for an excused absence.  Id. at 7.

The Court’s Decision

The Court denied Plaintiffs’ motion for class certification.  In addressing the four requirements of Rule 23(a) — numerosity, commonality, typicality, and adequacy — the Court concluded that each were satisfied.  Id. at 12-19.  The Court held that Plaintiffs established a common policy at issue, reduced to writing and centrally administered — the SAG — and identified common questions that were central to the case, such as whether the SAG has a disparate impact on pregnant workers, in that it disproportionately imposes discipline.  The Court also held that the typicality requirement was satisfied, since Plaintiffs’ claims arose from the same course of conduct underlying the class claims — the SAG — pursuant to which pregnant workers were treated differently.

The Court rejected AT&T’s arguments to the contrary, including that Plaintiffs were not typical because they “knew how to obtain excuses for a pregnancy-related absence under the SAG, but merely ‘failed to act on that knowledge.’”  Id. at 20.  The Court explained “[b]ut Plaintiffs’ claims are that they were unable to successfully obtain excused absences and received discipline,” and “[t]hese asserted experiences with the SAG policy are allegedly typical of the experiences of the pregnant employees they seek to represent.”  Id.  The Court further held that the adequacy requirement was similarly satisfied — Plaintiffs “submitted evidence that support their contention that their unexcused absences were pregnancy-related, and that it is sufficient to meet their burden at the class certification stage.”  Id. at 22.

The Court further analyzed whether the case could be certified under Rule 23(b)(3) or alternatively, Rule 23(c)(4).  The Court held that Plaintiffs failed to demonstrate under the “far more demanding” predominance inquiry that the questions of law or fact common to class members predominated over any questions affecting only individual members.  Id. at 23-24.  The Court found that individualized issues — including whether a class member was absent from work; whether the absence was caused by an inability to come to work; whether that inability was pregnancy-related; and whether the employee informed or attempted to inform AT&T of that inability; and whether the employee sought an excuse for the absence —  predominated in this case.  Further, resolving the issue that the assessment of points even without a termination is an adverse employment action because points may limit the availability of transfers or promotions for a class member would “necessarily require the Court to assess facts and circumstances unique to each individual in the class.”  Id. at 25.

Regarding Rule 23(c)(4), which states that “[w]hen appropriate, an action may be brought or maintained as a class action with respect to particular issues,” the Court agreed with AT&T’s position.  Id. at 28.  Specifically, the Court opined that the certification of a class on the issue of liability for any damages (compensatory or punitive) would not be appropriate due to the individual issues which would predominate whether and to what extent AT&T would be liable to any particular putative class member.  Accordingly, the Court held that Rule 23(a)(4) should not be employed under the circumstances of this particular case.  Id. at 29.

Implications For Employers

The ruling in Allen is noteworthy for employers as the latest in PDA class action litigation — a significant issue of concern for all employers.  Indeed, pregnancy discrimination has been highlighted by the EEOC as an issue of focus in recent years.  When plaintiffs attempt to certify classes with putative class members who were allegedly harmed by a common employment policy or practice, employers can point to Allen to illustrate why class treatment is still not appropriate.  Though Plaintiffs were able to establish all four of the Rule 23(a) prerequisites, the lack of glue amongst all pregnant employees’ experiences relative to the SAG precluded them from certifying a class under the requirements of Rule 23(b).

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis:  In EEOC v. Sherwood Food Distributors, Inc., No. 16-CV-2386, 2022 U.S. Dist. LEXIS 32921 (N.D. Ohio Feb. 24, 2022), a federal court in Ohio held an employer in contempt for failing to pay its payroll tax liabilities, as required by an EEOC consent decree that resolved a systemic discrimination lawsuit. In addition to paying the outstanding payroll tax, the Court ordered the employer to pay an additional $46,858.55 resulting from the 3.8% tax rate increase during the time of the contempt dispute, as well as potential settlement administrator fees.

This ruling should serve as a cautionary tale for employers in regards to negotiating and timely satisfying financial obligations in EEOC consent decrees.

Case Background

On September 27, 2016, the EEOC filed a lawsuit against Sherwood, alleging that it engaged in discriminatory hiring practices that adversely impacted female applicants, in violation of Title VII of the Civil Rights Act of 1964 (“Title VII”). The parties subsequently settled the litigation and entered into a Consent Decree, whereby Sherwood agreed to place $3.6 million into a Qualified Settlement Fund (“QSF”) account administered by a third-party (the “Administrator”) within 30 days of entry of the Consent Decree.  d. at *2.  These funds were to provide monetary relief to individuals that the EEOC determined were subjected to the alleged discrimination. Id. The monetary relief constituted both back pay and other monetary damages available under Title VII. Id. The EEOC was given the authority to determine what type of monetary relief would be paid to the eligible claimants (“Claimants”).

The EEOC alleged that Sherwood subsequently violated the Consent Decree by refusing to pay its payroll tax liability and therefore preventing the distribution of the $3.6 million to the Claimants by December 14, 2021.  In relevant part, the Consent Decree stated that Sherwood was responsible for paying its share of all applicable pay roll taxes and that the Administrator would inform Sherwood, “of the amounts of back pay distributed to each person from the QSF and all other information necessary for [Sherwood] to satisfy its payroll tax liabilities.” Id. The Administrator notified Sherwood’s counsel on December 1, 2021, of the amount that it owed in payroll taxes and provided notice that payment of the payroll taxes must be received on December 10, 2021, for the award checks to be timely distributed. The EEOC’s counsel communicated with Sherwood’s counsel in an attempt to compel the payment of the payroll taxes, but Sherwood indicated it would not make the payroll tax payment.

On January 27, 2022, the Court held a hearing regarding the EEOC’s motion for civil contempt.  Upon Sherwood’s request for a breakdown of the individual payments to be made to the Claimants, the Court continued the hearing until January 31, 2022.  Prior to the start of the hearing on January 31, 2022, the Administrator notified Sherwood that its total payroll taxes owed had increased from $361,890.68 to $408,749.23 due to the Ohio Department of Jobs and Family Services’ increase in QSF state unemployment tax rate from 2.7% in 2021 to 6.5% in 2022.  At the hearing, the parties were ordered to submit proposed findings of fact and conclusion of law, which were subsequently submitted on February 10, 2022.  Id. at 2-3.

The Court’s Decision

The Court held Sherwood in civil contempt for violating the Consent Decree. First, the Court explained that in order to establish a finding of civil contempt, the EEOC must show that the other party violated a definite and specific order of the Court, through “clear and convincing evidence.” Id. at *4 (citations omitted). The Court noted that the Consent Decree explicitly stated numerous times that Sherwood was responsible for payroll tax liability, and that distribution of the settlement funds must be completed by December 14, 2021.  Further, the EEOC produced email communications that Sherwood was informed of its payroll tax duties by the Administrator in accordance with the Consent Decree.  Accordingly, the Court held there was, “clear and convincing evidence,” that Sherwood violated the Consent Decree. Id.

Second, the Court held that Sherwood did not meet its burden to demonstrate that it took all reasonable steps to comply. Sherwood claimed that it attempted to negotiate an extension of the deadline, but the Court rejected this approach, noting that its extension request ten days before the deadline was untimely. Id. The Court thus held that, “Upon [the EEOC’s] unwillingness to negotiate, [Sherwood] should have complied with the Decree and the Administrator’s request for payment.” Id.

Third, the Court held that Sherwood failed to satisfy its burden of giving a detailed explanation as to why it could not presently comply with the Consent Decree and pay the $408,749.23 in payroll taxes. Id. at *5. The Court reasoned that Sherwood made no claim that it did not have the funds, nor did it offer any evidence of its financial situation.  In lieu of offering such evidence, Sherwood proposed paying in installments. The Court rejected this proposal as untimely. It opined that Sherwood should have made the proposal during settlement negotiations. In addition, the Court dismissed Sherwood’s argument that the EEOC conducted its investigation too slowly.

Accordingly, the Court held Sherwood in civil contempt for violating the Consent Decree. Sherwood argued it should only be responsible for paying the initial $361,890.68 and should not be required to pay the additional $46,858.55 resulting from the 3.8% tax increase. The Court rejected this argument on the grounds that the crease in taxes owed was a result of Sherwood’s delay. As such, the Court ordered Sherwood to pay the full amount of $408,749.23 within 30 days of its order, and to pay any additional costs incurred by the Administrator’s fulfillment of his duties that exceed the $35,000 amount set forth in the Consent Decree.

Impact For Employers

This ruling is an eye-opener for employers in terms of the potential implications for not satisfying obligations in any Consent Decree. Here, the employer’s delay was costly, as a change in the calendar year during the dispute led to an increased payroll tax debt. Accordingly, employers must be pragmatic when negotiating consent decree deadlines in EEOC-initiated litigation, and equally diligent in meeting those deadlines.

Readers can also find this post on our EEOC Countdown blog here.

Seyfarth Synopsis: Please join us tomorrow, Tuesday, February 15th for the 18th Annual Workplace Class Action Litigation Report webinar! Register now to secure your spot and review the workplace class action developments of 2021 and what employers should expect for 2022.

About the Program: In our 18th Annual Workplace Class Action Litigation Report Webinar, speakers will provide an in-depth interactive analysis of the class action decisions that shaped labor & employment litigation in 2021 and highlight the key trends emerging for 2022.

As developments in workplace class action litigation continue to evolve under pressure from pro-labor lawmakers and adjust to the modern realities of the American workplace shaped by the ongoing pandemic, corporate counsel and business leaders face unprecedented new challenges and must adapt by recalibrating their compliance strategies to stay ahead of these risks and exposures throughout the year.

Click here to register and attend!

Webinar Date/Time:

Tuesday, February 15, 2022

1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific


Gerald L. Maatman, Jr., Partner, Seyfarth Shaw LLP
Kerry M. Friedrichs, Partner, Seyfarth Shaw LLP
Ian H. Morrison, Partner, Seyfarth Shaw LLP
Jennifer A. Riley, Partner, Seyfarth Shaw LLP

Seyfarth Synopsis: In its recent review of Seyfarth’s 2022 Annual Workplace Class Action Litigation Report, EPLiC Magazine called the Report a “must-have resource,” the “only publication of its kind,” and that no corporate counsel “should be without it.”

We are humbled and honored by the recent review of our 2021 Annual Workplace Class Action Litigation Report by Employment Practices Liability Consultant Magazine (“EPLiC”) – the review is here.

EPLiC said: “The Report is a must-have resource for legal research and in-depth analysis of employment-related class action litigation. The Report is the only publication of its kind in the United States. It has been cited in briefs to the US Supreme Court and is considered ‘the Bible’ on class action issues that arise in the workplace.

EPLic stated: “The encyclopedic, 825-page 2022 Seyfarth Shaw Annual Workplace Class Action Litigation Report insightfully examines and analyzes a massive array of class action case decisions. In addition, the federal cases examined in the Report are indexed by federal circuit—an invaluable feature that further enhances the Report’s utility. The Report is also available in e-Book format and is fully searchable.

We are often asked – “How does it happen – how do you produce your Annual Workplace Class Action Litigation Report?”

The answer is pretty simple – we live, eat, and breathe workplace class action law 24/7.

Each and every morning we check the previous day’s filings of EEOC lawsuits and workplace class actions relative to employment discrimination, ERISA, and wage & hour claims. We do so on a national basis, both in federal courts and all 50 states. Then we check, log, and analyze every ruling on Rule 23 certification motions and subsidiary issues throughout federal and state trial and appellate courts. This is also done on a national basis.  We put this information in our customized database; we analyze and compare the rulings on class action issues and Rule 23 topics, and then we prepare an analysis of each and every decision.

Our class action practitioners contribute to the process of building the database and analyzing decisional law on a daily basis.

We have being doing this on a 24/7 basis for over 18 years, and publishing the Annual Workplace Class Action Litigation Report in the first week of January of each calendar year.

The result is a compendium of workplace class action law that is unique in its analysis, scope, and comprehensiveness. Thanks for the kudos EPLiC – we sincerely appreciate it!

We look forward to making the 2023 Report more comprehensive than ever!

By Jennifer Riley, Gerald L. Maatman, Jr., Tyler Zmick, Alex Karasik, Sarah Bauman, and Greg Tsonis

Seyfarth Synopsis:  The Illinois Supreme Court issued its long-awaited decision in McDonald v. Symphony Bronzeville Park, LLC, et al., 2022 IL 126511 (Feb. 3, 2022), holding that claims for statutory damages against an employer under the Illinois Biometric Information Privacy Act (“BIPA”) are not preempted by the exclusivity provisions of the Illinois Workers’ Compensation Act (the “IWCA”).  This ruling is a major development in the BIPA class action landscape, as it resolves a frequently-contested issue and effectively precludes employers from asserting IWCA preemption as a defense to BIPA claims. 

Case Background

The plaintiff in McDonald claimed her former employer, Symphony Bronzeville Park, LLC, violated the BIPA by requiring her and other employees to use a time-clock system that scans their fingerprints without properly providing notice, providing a publicly-available retention policy, or obtaining written consents required by the statute.  Defendant moved to dismiss on the basis that plaintiff’s claims were barred by the exclusivity provisions of the IWCA, under which the sole remedies for employees who have suffered work-related injuries are the remedies set forth in the IWCA.

The trial court denied defendant’s motion to dismiss but certified for appeal the question whether the IWCA’s exclusivity provisions bar a claim for statutory damages under BIPA.  The Illinois Appellate Court affirmed on the grounds that a BIPA claim for statutory damages is not an injury compensable under the IWCA.  See McDonald v. Symphony Bronzeville Park LLC, 2020 IL App (1st) 192398, ¶ 27.

The Illinois Supreme Court’s Decision

On appeal to the Illinois Supreme Court, defendant argued that the IWCA precluded plaintiff’s action because plaintiff’s alleged injury occurred in the course of her employment — meaning her available remedies were limited to those set forth in the IWCA.  In opposition, plaintiff argued that the IWCA’s exclusivity provisions applied only to physical or psychological injuries that are compensable under the IWCA and that a privacy injury under the BIPA constitutes a different type of injury.

The Supreme Court agreed with plaintiff. It held unanimously that her BIPA claims could proceed because her alleged privacy injury “is not categorically within the purview of the [IWCA].”  McDonald v. Symphony Bronzeville Park, LLC, 2022 IL 126511, ¶ 44.

The Supreme Court analyzed the BIPA’s purpose, as articulated in the 2019 decision in Rosenbach v. Six Flags Entertainment Corp., 2019 IL 123186.  The Supreme Court reiterated that through the BIPA, the Illinois General Assembly “codified that individuals possess a right to privacy in and control over their biometric identifiers and biometric information,” and that “when a private entity fails to comply with one of section 15’s requirements, that violation constitutes an invasion, impairment, or denial of the statutory rights of any person or customer whose biometric identifier or biometric information is subject to the breach.”  McDonald, 2022 IL 126511, ¶ 24 (quoting Rosenbach, 2019 IL 123186, ¶ 33).

The Supreme Court explained that the IWCA generally provides the exclusive remedy for work-related injuries, unless a plaintiff can establish one of the four recognized exceptions to the IWCA’s exclusivity provisions, including: (1) if the injury was not accidental; (2) if the injury did not arise from employment; (3) if the injury did not occur during the course of employment; or (4) if the injury is not compensable under the IWCA.  McDonald presented a question regarding the fourth exception, i.e., whether the injury resulting from a BIPA violation is compensable under the IWCA.

In answering in the negative, the Supreme Court relied primarily on its decision in Folta v. Ferro Engineering, where a plaintiff diagnosed with mesothelioma sued his former employer after allegedly being exposed to asbestos on the job.  2015 IL 118070, ¶ 3.  The trial court granted plaintiff’s employer’s motion to dismiss based on the exclusivity provisions of the Workers’ Occupational Diseases Act (the “WODA”), which were interpreted in accordance with the IWCA’s exclusivity provisions.  The plaintiff argued the exclusivity provisions did not apply pursuant to the “compensability” exception because he could not recover under the WODA in that he filed his claim beyond the 25-year repose period.  The Illinois Appellate Court reversed. It opined that the plaintiff’s inability to recover damages under the WODA placed his case within the exception for “non-compensable injuries.”

The Supreme Court reversed the appellate ruling, concluding that the exclusivity provisions barred the plaintiff’s cause of action even though compensation was unavailable due to the statutory time limits.  Folta framed the question of whether an injury is compensable as “not whether an injury was literally compensable, i.e., whether the employee could literally receive compensation for injuries under the acts,” but “whether the type of injury categorically fits within the purview of the” workers’ compensation acts.”  McDonald, 2022 IL 126511, ¶ 24 (quoting Folta, 2015 IL 118070, ¶ 23).  Because the WODA addressed diseases caused by asbestos exposure, Folta held that the plaintiff’s injury was “the type of injury contemplated to be within the scope of” the WODA.  Id. ¶ 39 (quoting Folta, 2015 IL 118070, ¶ 25).

Using Folta’s framework, the Supreme Court in McDonald held that injuries caused by BIPA violations “are different in nature and scope from the physical and psychological work injuries that are compensable under the [IWCA].”  Id. ¶ 43.  The Supreme Court contrasted “injuries that affect an employee’s capacity to perform employment-related duties, which is the type of injury for which the workers’ compensation scheme was created,” with the privacy injuries “caused by violating [BIPA’s] prophylactic requirements.”  Id.

The Supreme Court further noted that the BIPA’s text supported its conclusion because the BIPA “defines the precollection ‘written release’ required by” Section 15(b) of the BIPA “to include ‘a release executed by an employee as a condition of employment.’”  Id. ¶ 45 (quoting 740 ILCS 14/10).  The Supreme Court reasoned that the legislature knew BIPA claims could arise in the employment context, “yet it treated them identically to nonemployee claims except as to permissible methods of obtaining consent.  Therefore, the text of [the BIPA] itself . . . is further evidence that the legislature did not intend for [BIPA] claims to be presented to the Workers’ Compensation Commission.”  Id. ¶ 45.

Implications For Employers

McDonald has major implications for employers facing BIPA claims.  The decision effectively makes the IWCA preemption defense unavailable in BIPA cases.  Moreover, many BIPA cases pending in state and federal courts have been stayed pending the Illinois Supreme Court’s McDonald decision, and those stays may soon be lifted in light of the opinion being released.

Significant questions remain, however, regarding BIPA’s application to companies that collect biometric information.  Some questions will be decided in other appeals pending before the Illinois Supreme Court, which may lead courts to maintain previously-entered stays despite the issuance of McDonald.  For example, the U.S. Court of Appeals for the Seventh Circuit recently issued a decision in Cothron v. White Castle Systems, 20 F.4th 1156 (7th Cir. 2021), certifying to the Illinois Supreme Court the question whether claims asserted under Sections 15(b) and 15(d) of the BIPA accrue only once upon the initial collection or disclosure of biometric information, or each time a private entity collects or discloses biometric information.  (See here).  Similarly, the limitations period applicable to BIPA claims remains unresolved.  As previously noted (here), the Illinois Appellate Court in Tims v. Black Horse Carriers, Inc., 2021 IL App (1st) 200563 (1st Dist. Sept. 17, 2021), held that a one-year limitations period governs actions brought under BIPA Sections 15(c) and (d), while claims under BIPA Sections 15(a), (b), and (e) are subject to the catch-all five-year limitations period.  The Illinois Supreme Court allowed the Tims defendant’s petition for leave to appeal on January 26, 2022 — meaning it is poised to issue two more critical BIPA rulings in the coming months.