Law Offices of Stanley E. Niew, P.C.

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LABOR & CONSTRUCTION LAW UPDATES

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APRIL 2022

Inside This Issue

1. Captive Audience Speeches Are Now Unlawful Under the National Labor Relations Act (NLRA)

2. Wage Payment and Collection Act Amended

3. Illinois Courts Reject Insurance Business Interruption Coverage Due to Covid-19

4. Illinois Appellate Court Refuses to Block Enforcement of Vaccine Testing Mandates

5. When Does “Doctrine of Impossibility” Excuse Breach of Contract?

Captive Audience Speeches Are Now Unlawful Under the National Labor Relations Act (NLRA)

For the past 75 years the NLRB has maintained a rule that during an organizing campaign by a union in construction, the employer could require a mandatory captive audience speech and could require all affected employees to attend.

Earlier this month the NLRB General Counsel issued a Memorandum that states captive audience speeches were now unlawful since such captive audience speeches interfere with employees’ exercise of Section 7 rights to self-organize to form, join, or assist unions for the purpose of collective bargaining. Employers will need to wait and see what the full NLRB and the courts will do in upholding this radical change.

This is a continued assault by the current NLRB General Counsel on existing rulings that favor employers.

Wage Payment and Collection Act Amended

The Illinois Wage Payment and Collection Act (IWPCA) was amended by adding a new Section 13.5 which provides in part that any construction contract entered into after July 1, 2022, will make the primary contractor contractually liable for any subcontractor’s non-payment of wages and benefits for any tier subcontractor that furnishes goods or services in connection with a contract between the primary contractor and property owner. A primary contractor includes general contractors, construction managers and property owners who act as primary contractors related to construction. This probably includes developers that subcontract construction work. Excluded are contractors who solely provide goods and transport related to a contract.

Subcontractors are exempted from non-payment of wages and benefits when the primary contractor fails to pay the subcontractor monies that are due.

Under the old law prime contractors were not responsible for their subcontractor’s non-payments.

Illinois Courts Reject Insurance Business Interruption Coverage Due to Covid-19

At least two Illinois Appellate Courts have found that insurance coverage is not available under the typical property coverage insurance policy when an owner sustains losses due to shut downs or slow downs as a result of Covid-19 interruptions. In 2001, the Illinois Supreme Court addressed similar language as in the two Appellate Court cases and concluded that “physical injury” did not include damage to property such as economic loss.

Illinois Appellate Court Refuses to Block Enforcement of Vaccine Testing Mandates

Governor Pritzker issued a vaccine mandate in August 2021 for health care workers, school employees, as well as state employees, who work in congregate facilities. These employees could be forced to receive a vaccine or mandatory testing.

In the suit, the plaintiffs challenged vaccine and testing mandates, which an Illinois Appellate Court rejected because the employers in the three cases did not quarantine or isolate anyone, but simply threatened to fire the employees.

There was a dissenting opinion concluding that since the general assembly included many examples which prohibited the discrimination, it was improper to use an amendment to another law as an interpretive aid.

When Does “Doctrine of Impossibility” Excuse Breach of Contract?

In an Illinois First Appellate Court decision issued in March 2022, a restaurant tenant in Cook County was sued by the landlord for non-payment of rent during the Covid epidemic and when there was rioting and property damage to the leased premises as well as surrounding properties. The tenant argued that the circumstances made it “impossible or impracticable” to operate a restaurant during this period of time. The Appellate Court, in reversing the trial court, opined the tenant must show impossibility of performance under an objective standard and not merely difficult to achieve.

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