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Springfield Highlights

Springfield Highlights – May 25, 2018

Final Days of Spring Legislative Session

Lawmakers in both the House of Representatives and Senate cancelled session for the weekend and are heading home for the Memorial Day holiday with less than one week remaining in the scheduled spring session. There is a renewed sense of optimism in the air that Governor Bruce Rauner and lawmakers will be able to reach a budget agreement by the end of May.

The Governor’s Office of Management and Budget, along with a bipartisan budget working group, have been negotiating for weeks on a nearly $37 billion spending plan. According to negotiators, they are working to close a nearly $500 million gap that still exists between both sides that would need to be achieved through spending cuts or additional revenue. The IMA has been meeting on a regular basis with lawmakers in both chambers to make sure that critical job training programs and tax incentives like the Manufacturers Machinery & Equipment exemption are not negatively impacted.

If Governor Rauner and lawmakers agree on a budget, it will be the first time in four years that Illinois has a budget before the scheduled end of session.


Workers Compensation Discussions Continue

Multilateral negotiations regarding workers’ compensation are ongoing as Democrats try to drive changes in the system that could negatively impact the employer community.  Illinois businesses already pay the eighth highest cost of workers’ compensation in the nation and the proposals on the table could potentially increase those costs.

The IMA is directly engaged in discussions with the medical community that is seeking a change in law doubling interest payments from one percent to two percent monthly on medical bills. Doctors would like to be able to sue in court to get paid interest on these medical bills costing time and money. Additionally, the legislation would impose severe penalties on employers that don’t utilize electronic billing. A recent court case found that medical providers had no remedy to receive interest payments but the legislation (SB 904, amendment #1) that was introduced went far beyond that decision. The business community is working to negotiate a reasonable proposal that will ensure providers are paid on time for undisputed medical bills.

House Labor Committee Chairman Jay Hoffman (D-Collinsville) is also pressing for changes that would require insurance rate regulation or review in the workers’ compensation domain. Illinois has a competitive market with file and use rates but Democrat lawmakers would like to require pre-approval of rates at the Department of Insurance. Democrats have previously sought creation of a State Workers’ Compensation Fund (HB 4595) to compete against the private sector.

The Illinois Manufacturers’ Association will continue advocating against any proposals that will add costs to an already expensive system.


Omnibus Sexual Harassment Amendment Filed

Senator Melinda Bush (D-Grayslake) filed a comprehensive amendment to SB 577 in the past week seeking to address the looming issue of sexual harassment in the workplace. The amendment contains numerous provisions that are under review because of their potential impact on the business community.

Among the provisions is language that would increase the length of time that employees have to file complaints with the Department of Human Rights from 180 days to two years. Public contractors and all employers with more than one hundred employees would be required to file annual reports to DHR that include all settlements related to sexual harassment or discrimination. The Department would be required to open an investigation into employers with repeated settlements; these could not be sealed or have non-disclosure agreements unless it is the victim’s choice.

Senator Bush is hoping to advance legislation in the Senate next week after hearing from stakeholders.


New E-Waste Agreement Advances

Stakeholders in the E-waste discussion that negotiated both the Illinois Consumer Electronics Recycling Act (CERA) and trailer legislation to CERA earlier this spring are again working together to finalize amendatory language for SB 3550. The proposal now allows for residential collection of CEDs at drop-off locations in Illinois while preserving the integrity of the Manufacturer’s Clearinghouse that goes into operation in 2019 for the collection of electronic waste.

Stakeholders in the years-long process include the IMA, individual manufacturers, recyclers, waste haulers, and units of local government.

The idea of drop-off locations for E-waste has been a topic of contention the past few years as concerns were raised about the lack of oversight and the ability to track the electronic waste at these locations. Through negotiations, SB 3550 now provides assurances that the sites will not become a dumping ground for out-of-state haulers. The new language provides for site certification, audits, and checks and balances between the sites, recyclers, local government and waste haulers.

The bill, being sponsored by Representative Nick Sauer (R-Libertyville), is expected to move quickly next week when the General Assembly returns to Springfield.

It is important to note that the universally agreed upon trailer bill to the Illinois Consumer Electronics Recycling Act still sits in the House on concurrence. HB 3248 is essential in allowing the Manufacturers Clearinghouse to operate next year as it contains needed anti-trust language and the formula for E-waste collection. HB 3248 must be signed well before July 1st.


Call Center Penalties Stalls

Senator Scott Bennett (D-Champaign) announced that he will not proceed further this session with HB 4081, a bill that would penalize any employer that moves all or a portion of its call center out of Illinois. This announcement comes a week after the bill failed to advance out of the Senate Telecommunication & Information Technology Committee when it fell two votes short of passage. This is a win for businesses and manufacturers who would not only be subject to hefty fines under the bill, but would also lose important tax incentives.


Equal Pay Bills Split Committee

The Senate Labor Committee heard two bills this week that attempt to shrink the gender wage gap by tackling the issue of wage and salary history. The first bill, HB 4163 (Moeller/Castro) prohibits an employer from using wage or salary history when making hiring or promotional decisions. The IMA opposed the legislation because it allowed an employee to double dip by suing an employer in both state and federal court and it removed the ability of a company to offer an affirmative defense. Identical legislation passed the legislature last year but was vetoed by Governor Rauner.

This year, Senator Jennifer Bertino-Tarrant (D-Plainfield) sponsored SB 3100 that bans employers from asking a job candidate about their salary history. Her legislation is an attempt to remedy the issue and take politics out of the equation. The IMA and business community are supportive of SB 3100.

HB 4163 passed the committee while SB 3100 narrowly failed to pass but is expected to receive another vote next week.


Wage Lien Legislation

Senator Kimberly Lightford (D-Westchester) advanced HB 4324 out of the Senate this week over employer opposition after amending the bill to negate a compromise that had been reached in the House of Representatives.

The bill originally allowed employees or former employees to file a wage lien on a company and their property for up to six months without judicial or administrative review. In the House of Representatives, a coalition of employers led by the Illinois Retail Merchants Association worked with House Labor Chairman Jay Hoffman and Representative Chris Welch to reach an agreement to reduce the time spent on wage lien claims to 30 days at the Department of Labor. The agreement also required employers to post a 10 percent bond that would have to be released within 45 days.

However, Senator Lightford amended the agreed upon bill and removed language that the bond be returned to the employer within 45 days. This amendment goes directly against the agreement that had been previously made and has forced the IMA and business groups to once again oppose the bill.

HB 4324 now heads back to the House on concurrence where Representative Hoffman and Welch have vowed to hold the bill because it violates the agreement.