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

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JULY 2021

Inside This Issue

1.   Pretrial Interest Is Now Law in Illinois

2.   Wholly Owned Subsidiary Is Protected Under Exclusive Remedy of Worker’s Compensation Act

3.   Transgender Health Protections Restored

4.   Considering A Divorce – Consider Corporate Retained Earnings

5.   Illinois Now Has Comprehensive Non-Compete Law

6.   NLRB Rules Solicitation of Mail-In Ballots Is Objectionable Conduct

7. Supreme Court Rules In Favor Of Farmers Against Unions

Pretrial Interest Is Now Law in Illinois

Last month Governor Pritzker signed Senate Bill 72 which grants 6% pretrial interest in personal injury or wrongful death suits in state civil courts. The interest on money awards is retroactively applied from the time the lawsuit is filed to the time of a judgment or a settlement.

The new law does not impact worker’s compensation claims, exempts punitive damages, sanctions, statutory attorney’s fees and costs. The new law also does not apply to governmental agencies, as well as the state. It is not certain whether the law will apply to discrimination claims which will likely be decided by the courts.

Illinois now joins 37 other states with similar measures.

Wholly Owned Subsidiary Is Protected Under Exclusive Remedy of Worker’s Compensation Act

In the case of Munoz v. Bulley & Andrews both the trial and appellate court found that the defendant was immune from liability in a separate lawsuit based on the exclusive remedy provisions of the Illinois Worker’s Compensation Act.

The plaintiff filed a personal injury claim against a construction company which performed services on a construction project. The plaintiff injured his back while working on the project. The plaintiff was an employee of a separate wholly owned subsidiary of the defendant construction company. The defendant had purchased worker’s compensation insurance which covered both the defendant and the wholly owned subsidiary and the defendant paid substantial worker’s compensation benefits to plaintiff prior to filing the lawsuit.

Transgender Health Protections Restored

The Trump Administration took the view that sex means the gender assigned at birth. The Biden Administration reversed the Trump policy taken by the Department of Health and Human Services (“HHS”). The HHS Secretary concluded that anyone, including LGBTQ people, would be able to access free health care.

It would appear that persons seeking gender transition treatment and transgenders who need care for illnesses are now protected. This new policy is in line with last year’s Supreme Court decision which established that federal laws against sex discrimination on the job protect gay and transgender persons.

Considering A Divorce – Consider Corporate Retained Earnings

Courts in divorce actions are increasingly considering whether corporate retained earnings are marital or non-marital property. The answer depends upon a number of factors such as when the corporation was formed (before or after the marriage), who actually owns the retained earnings, the shareholder or the company. While the list here is not all inclusive, one who is contemplating a divorce should consider whether retained earnings could be a marital asset.

Illinois Now Has Comprehensive Non-Compete Law

The Illinois Legislature passed amendments to the Illinois Freedom to Work Act which imposes limits and restrictive covenants. The amendments become effective January 1, 2022 and the Governor is expected to sign the legislation.

The new law establishes income thresholds for non-compete and non-solicitation agreements. For example, the law only applies to persons making $75,000 a year this coming January 1, 2022, and raises periodically to $90,000 on January 1, 2037. A non-solicitation agreement includes any agreement that bans solicitation of customers, prospective customers, employees, and vendors. The law does not apply to construction employees formerly performing management, engineering and architectural services as well as sales for a construction employer. The law also does not apply to shareholders, partners or owners.

Employers can make otherwise illegal non-compete or non-solicitation clauses lawful if an employer advises an applicant in writing to consult with an attorney before entering the covenant and provides the applicant a copy of the covenant at least 14 days before starting employment or if an employer provides an employee with at least 14 days to review the covenant.

NLRB Rules Solicitation of Mail-In Ballots Is Objectionable Conduct

On June 9, 2021, the National Labor Relations Board ruled that solicitation of mail-in ballots constitutes objectionable conduct in NLRB elections. NLRB conducts elections as a result of petitions by a union, by an employer or by an employee. The NLRB refused to set aside the election even though the employer could establish that a union solicited mail-in ballots. The NLRB reasoned that the solicitation while unlawful did not affect the outcome of the election since the union won by 10 votes, but there were only two votes which were solicited.

Supreme Court Rules In Favor Of Farmers Against Unions

In a 6-3 decision the U.S. Supreme Court ruled that unions may not enter on a farmer’s private property without paying for the visit. The Court reviewed a California law which allowed unions to visit agricultural workers on farms. The Supreme Court stated that the California law violated the U.S. Constitution Fifth Amendment’s prohibition from taking private property without payment to the growers.

It appears this ruling is a major set back to organized labor.

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