Council Urges Withdrawal of IDOL Rule on Joint Employer Status
The Chamber's Employment Law Council organized efforts from business organizations to oppose the Illinois Department of Labor's (IDOL) proposed joint employer rule. The rule seeks to establish a state standard for the factors to determine when there is a joint employer status and joint and several liability for employee benefits and rights.
The Department is attempting to decouple Illinois' joint employer standard from the rule that the US Department of Labor (USDOL) adopted in March of this year. We are concerned that the IDOL rule will send another signal that Illinois is a more difficult state to do business in. It is highly unlikely that any of our neighboring states will take a similar action as IDOL is proposing. Our letter points out:
The Department's proposed rule will eliminate the many positive features of the USDOL rule. The IDOL proposed rule will:
- Eliminate the uniformity that the USDOL rule provides thus creating greater uncertainty for both employers and workers;
- Increase the cost of compliance and likelihood of litigation for businesses because of:
- multiple standards that employers must comply with; and
- the Illinois proposal lacks viable examples to provide guidance to small businesses;
- Discourage the use of franchise models in Illinois which results in lower economic and job opportunities; and
- Place an additional regulation and cost of doing business that other states are unlikely to impose creating another obstacle for Illinois small businesses to operate successfully.
We also expressed disappointment that IDOL did not communicate with business interests their concerns about the federal rule change and seek our input. Nor does it appear that IDOL did any analysis of the impact on small business as required by the Illinois Administrative Procedure Act. As a consequence, the Chamber requested IDOL to withdraw its proposed rule and allow time for determination of the impact of the federal rule. If experience shows that the federal rule has a negative impact, we encouraged the Department to meet with the Illinois Chamber and other stakeholders to address any problems caused by the federal standard.
In comments submitted by the Illinois Construction Industry Committee, they argued IDOL's
joint employer standard is not based upon any established Fair Labor Standards Act or Illinois minimum wage law test. Instead IDOL is proposing a much broader formulation and violates years of established Illinois state and federal court precedent interpreting joint employment standards under the Illinois minimum wage law and related Illinois statutes.
The Department will review the comments from the Chamber and other groups and will provide responses to those comments to each commenting organization/individual before the rule goes to second notice.
IDES Gets New Director...Kristen Richards, Senate Democrat Chief of Staff
Governor JB Pritzker announced his appointment of Kristin Richards, current Chief of Staff to the Senate President, to serve as the Director of the Illinois Department of Employment Security(IDES). She replaces Acting Director Thomas Chan, who was filling the position until a permanent director was named.
Richards has served two governors and two senate presidents during her 18-year tenure in public service, overseeing nearly two dozen state agencies and seven state budgets. Since 2016, Richards has been the Chief of Staff in the Office of the Senate President, where she leads a 120-member office and serves as management adviser for 40 Senate district offices. She's provided guidance through the Covid-19 pandemic on issues ranging from health care to unemployment, established a robust HR infrastructure that protects workers, and partnered with the Senate president and minority leader to develop the bi-partisan plan that ended the two-year budget impasse. Prior, Richards served as the office's Policy and Budget Director from 2009 to 2016. During the seven-year period, she prepared, negotiated and passed the state's annual operating and capital budgets, which surpassed $426 billion in combined state and federal spending, and collaborated with federal and state officials to create the $31 billion Illinois Jobs Now! capital program. From 2007 to 2009, she was the Deputy Chief of Staff in the Office of the Governor, serving as the policy development lead on P-20 education and capital planning. As a Policy Adviser from 2003 to 2006, Richards oversaw eight state agencies, including Departments of Agriculture, Natural Resources, and Corrections; Illinois EPA; and Illinois State Police. She began her career in public service as James H. Dunn Fellow in the Governor's Springfield office. Richards earned her Bachelor of Arts in Political Science, magna cum laude, from Millikin University in Decatur, Illinois.
The Chamber is very familiar with Ms. Richards and she is familiar with the Chamber. We congratulate her on her new adventure at the Department.
Council Hosts Demo for IWCC's New Electronic Settlement Process
The members of the ELC's Workers' Compensation Committee were able to preview the Workers' Compensation Commission's electronic settlement process that will go into effect July 22nd. Matt Bryant of Workers' Compensation Strategies led the presentation. The change will help streamline the Commission's handling of settlement agreements and provide a means for data collection. For employers, the new electronic settlement will dramatically reduce the time for approval of a settlement once the settlement is agreed to by the parties.
IWCC Chairman Michael Brennan has made upgrading the Commission's information technology a priority. Additional phases of bringing online technology to the Commission will be announced later this year and in 2021. Hundreds of new lap tops and work stations for Commission staff are in the process of being purchased.
Financial resources from the Illinois Chamber's lawsuit settlement from over ten years ago are being used per the settlement to help bring the Commission's IT systems to the 21st century. We are very supportive of the Commission's efforts with Workers' Compensation Strategies to bring effective and cost efficient improvements to the Commission
Illinois Chamber Kicks Off Efforts Opposing Progressive Tax
On the November ballot will be the constitutional question whether Illinois should change from a flat tax to a progressive income tax system. To approve the question, 50% plus one of all voters voting on November 3rd must vote "yes" or 60% of those voting on the question must vote "yes".
If approved, the General Assembly has already enacted new tax rates to go into effect on January 1, 2021 (see
). During the May Special Session, the General Assembly also provided for the wording of the arguments that will be sent to all registered Illinois voters in
In general, the arguments for are:
- This Amendment Would Make Illinois' Tax System Fair;
- The Federal Government and Most States Use the Progressive Tax System Proposed in this Amendment, Not the Unfair System Currently Used in Illinois;
- Illinois' Current Income Tax System Relies on Taxes from Middle and Lower Income Earners, While a Progressive System Would Lower that Burden and Fund Critical Programs such as Education and Human Services; and
- After the COVID-19 Pandemic, We Need to Do All We Can to Help the Economy and Middle-Class and Working People.
Arguments against the change:
- The Amendment gives the Legislature power to increase taxes on any group of taxpayers with no limits and no accountability and without any requirement to use the additional revenue to fund essential needs such as healthcare, education, or public safety;
- Taxes and spending are out of control. The Legislature should not be allowed to keep raising taxes until they get their spending under control; and
- In the wake of the COVID-19 pandemic, now is the worst possible time for a massive tax increase.
After reviewing the facts and considering both sides of the issue, the Illinois Chamber is opposing the question because of the negative impact the income tax change would have on Chamber members and the Illinois' economy. In an effort to educate the public, Illinois Chamber members and their employees, the Chamber has joined with the "Vote No on the Progressive Tax Coalition". Members of the Coalition include the Illinois Farm Bureau, National Federation of Independent Business (NFIB), Americans for Prosperity, Technology & Manufacturing Association, the Illinois Chapter of the Associated Builders & Contractors, the Midwest Southeastern Equipment Dealers Association, and the Automotive Parts & Service Association of Illinois. Other organizations are being recruited to join the efforts to defeat the constitutional question. The emphasis of the Coalition will be a grassroots strategy to bring the facts to the debate.
To provide resources for our members to discuss the issue with employees, customers, friends and family, Vote No on the Progressive Tax Coalition has a website for you to obtain additional information about the issue:
Yard signs and brochures also are available for purchase at the website. Also, a speakers bureau is being organized. If you have a group or organization that would benefit from hearing why the tax change is dangerous to Illinois' future, contact us and we will assist in arranging a speaker to be there.