On January 1, 2008, the landscape in Illinois will change for employers facing accusations of discriminatory or retaliatory conduct arising under the Illinois Human Rights Act (the Act). On August 17, 2007, Governor Blagojevich signed Public Act 95-0243 into law, which significantly alters the procedures available to employees claiming discrimination, harassment or retaliation under the Act. Those employees will now have the right to a jury trial in a state court, regardless of how the Illinois Department of Human Rights (IDHR) resolves the initial charge of discrimination.

The exposure to jury verdicts constitutes a substantial risk for employers. In a recent Massachusetts case, a jury awarded $2.2 million to a plaintiff who proved her claim of sexual harassment. A Texas jury awarded the victim of age discrimination $1.6 million. In November 2006, an Illinois jury awarded three women $2.355 million in a sexual harassment case. The threat of significant monetary awards arguably increases under the Act, because unlike Title VII of the Civil Rights Act of 1964, the Act does not cap damage awards.

Currently, under the Act, an employee who brings a discrimination or retaliation suit files a charge of discrimination with the IDHR. The IDHR then has 365 days to investigate before making a decision about the merits of the charge. If the IDHR fails to act within 365 days, or within such extensions agreed upon by the parties, it must dismiss the case. The aggrieved employee then has ninety days to file a complaint before the Illinois Human Rights Commission or forfeit any claims raised in the charge. A case before the Human Rights Commission is tried before an administrative law judge, not a jury.

Under the existing Act, if within 365 days or the extensions granted by the parties, the IDHR finds no merit to the charge, it will dismiss the claim for a lack of substantial evidence. The vast majority of cases fully investigated are dismissed in this fashion. For example, in 2006, only seven percent of the IDHR’s completed investigations resulted in a finding of substantial evidence. Once the IDHR makes a “lack of substantial evidence” finding, the employee can proceed only if he or she successfully challenges the finding by appealing to the IDHR’s chief legal counsel within thirty days after receiving notice of the dismissal. If the appeal is unsuccessful, the case is over and the employee cannot proceed further. If, on the other hand, the IDHR finds substantial evidence, a complaint is filed on behalf of the employee with the Human Rights Commission, after conciliation has been completed.

Under the amendments, employees are given the right to sue in Circuit Court:

• within 90 days after the IDHR dismisses the case for its failure to act within the 365-day period, or within such extended period as the parties agree upon;
• within 90 days after the IDHR makes a finding of no substantial evidence; or
• within 90 days after the IDHR makes a finding of substantial evidence.

The right to proceed in circuit court will include the right to pursue an individual defendant who is an alleged perpetrator in a sexual harassment case. The changes to the Act will apply only to charges filed on or after January 1, 2008.

There are, however, some minor limitations on an employee’s ability to file a complaint in circuit court under the amendment. For example, if the IDHR dismisses a charge for lack of substantial evidence, or because it failed to act within 365 days, and the employee elects to have the matter reviewed by the Human Rights Commission, the employee may not later commence an action in circuit court.

The implications of the amendments are far-reaching. Access to the state court system will likely increase the number of marginal claims litigated because a finding of no substantial evidence does not end the inquiry—employees who fail to demonstrate the necessary factual support for their charge may still sue the employer in circuit court. Further, jury trials increase the risk and expense of litigating a discrimination or retaliation claim. One aspect of the increased expense is that many state court judges are not particularly familiar with the Act, and are not generally disposed to grant summary judgment.

Additionally, the scope of discovery available in circuit court will likely increase the cost of litigation. Under the Act, discovery is currently limited. The parties are not entitled to take depositions unless good cause is shown or unless the parties agree. Conversely, the discovery rules in state court allow the complaining employee to take the deposition of any person who is believed to have relevant information about the claim. For example, in a sexual harassment case, the employee could depose all persons he or she claims to have witnessed the offensive conduct. This not only increases the costs of defense, but also adds to the disruption of the employer’s workplace.

Another aspect of the amended Act is that employees who fail to invoke their remedies before the Human Rights Commission in a timely manner are afforded at least two months to file a complaint in circuit court. This may result in dilatory employees seeking refuge in circuit court after missing the filing deadlines before the Commission.

Human resource professionals, senior management and business owners should take this opportunity to conduct an audit of their HR practices. Specifically, if anti-discrimination and/or anti-retaliation provisions have not been recently updated, now is the time. Additionally, general disciplinary practices should be reviewed to assure internal consistency in the application of rules of conduct. Finally, employers should have an effective internal mechanism for receiving and investigating complaints. The best defense against liability in the discrimination and retaliation arenas is a good offense—beginning with an honest assessment of existing employment policies and practices. IBI