The Illinois Workplace Transparency Act (WTA) (Public Act 101-0221) is designed to protect employees, consultants, and contractors who truthfully report alleged unlawful discrimination and harassment or criminal conduct in the workplace by prohibiting nonnegotiable confidentiality obligations, waivers, and mandatory arbitration of allegations of discrimination, harassment, or retaliation. The WTA became effective January 1, 2020, and makes these provisions void unless the agreement demonstrates that the employer and employee mutually agreed to the provisions. The WTA carries important implications for all sorts of employment or consulting/independent contractor agreements, as well as settlement agreements and termination agreements.
The WTA applies to “employer[s],” as the term is defined in the Illinois Human Rights Act (IHRA). Until July 1, 2020, that means that employers that have 15 or more employees within Illinois during 20 or more calendar weeks in a calendar year are subject to the WTA’s provisions.
On July 1, 2020, amendments to the IHRA will go into effect that will apply the WTA to any employer with one or more employees within Illinois during 20 or more calendar weeks in a calendar year.
The WTA’s protections apply to employees including full-time and part-time employees, apprentices, unpaid interns, and to consultants and contractors who perform work for the employer pursuant to a contract.
The WTA does not apply to collective bargaining agreements.
Under the WTA, employment agreements cannot impose nonnegotiable, unilateral conditions (i.e., conditions that prospective or current employees must accept to obtain or keep their jobs) that:
These conditions may be allowed if they are part of a mutual agreement between the employer and the employee that is:
If the employer does not comply with these requirements for mutual agreements, there is a rebuttable presumption that the condition is unilateral. Unilateral conditions are void as against public policy, and severable from an otherwise valid and enforceable agreement.
Under the WTA, a settlement and termination agreement can require confidentiality relating to alleged unlawful discrimination, harassment, or retaliation, only if the following requirements are met:
Employers cannot unilaterally include any clause that prohibits the employee from making truthful statements or disclosures regarding unlawful discrimination, harassment, or retaliation.
Even in a mutual agreement that meets the WTA requirements above, employees cannot waive their right to testify in an administrative, legislative, or judicial proceeding concerning alleged criminal conduct or alleged unlawful employment practices by the employer when required or requested to attend pursuant to a court order, subpoena, or written request from an administrative agency or the legislature. This type of waiver is void and unenforceable as against public policy.
The WTA allows employers to require confidentiality from employees or third parties who:
Employers may want to consider whether employment agreements, nondisclosure or confidentiality agreements, independent contractor or consulting agreements, settlement agreements, or termination agreements contain unilateral requirements or waivers that may be void under the WTA and require revision. Employers may also want to consider revising existing agreements to comply with the requirements to demonstrate that an agreement is mutual, and to provide the employee protections required by the statute.
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