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Employers Win One, Lose One

By Michael Kraft

The Loss: Employer’s Strict Liability for Sexual Harassment by Its Supervisors Greatly Expanded

In the recent decision of Sangamon County Sheriff’s Department v. Illinois Human Rights Commission, the Illinois Supreme Court greatly expanded Illinois employers’ potential liability under the Illinois Human Rights Act (“IHRA”) for sexual harassment of an employee by a supervisor.

Previously, an Illinois employer’s liability under the IHRA for a supervisor’s sexual harassment mirrored that of an employer’s liability under federal law. Federal law imposes strict liability upon employers only for conduct by a supervisor with immediate or successively higher authority over the harassed employee.1 In this opinion, though, the Court held that an Illinois employer is strictly liable for sexual harassment of an employee by a supervisory employee, even if the supervisor has no authority to affect the terms and conditions of the complaining employee’s employment. In other words, an Illinois employer, under this decision, will now be held strictly liable for sexual harassment by any supervisor within the employer’s organization, even if the complaining employee is in an entirely different department or physical location and not in any way under the direction or supervision of the harasser.

The Court did not directly address the definition of a “supervisor,” which is now of utmost importance after this decision. Accordingly, an employee who has any authority or control over any other employee should be considered a “supervisor” under the IHRA for purposes of this issue.

As a result of this decision, Illinois employers are now in a more difficult position to assess the scope of potential liability for sexual harassment by one of their employees. This decision certainly expands each Illinois employer’s potential liability.

Illinois employers are now strongly encouraged to be (or remain) proactive in training all supervisory employees regarding sexual harassment and hostile work environments. It is now even more important for employers to train and educate all of their employees regarding the boundaries between acceptable conduct and that which harasses or creates a hostile work environment.

The Win: Covenants Not to Compete are made Easier for Employers to Enforce

In Sunbelt Rentals, Inc. v. Ehlers, an employer sought to enforce a covenant not to compete against a former sales employee. The covenant not to compete included a one-year time period and a prohibited geographic area within 50 miles of each of the employer’s store sites.

Prior to the Sunbelt decision, employers had the burden to prove a “legitimate business interest” in order to enforce a covenant not to compete, in addition to proving the reasonableness of the time and geographic scope of the covenant not to compete. However, the Illinois Appellate Court, Fourth District, held in Sunbelt that Illinois law does not require an employer to prove that a legitimate business interest is being advanced through the enforcement of the covenant not to compete. Instead, the court merely analyzed the reasonableness of the scope of the covenant not to compete.

It must be noted that this decision was issued by the Illinois Appellate Court, Fourth District, which includes Springfield, Champaign, Quincy and Charleston-Mattoon. Most of the other Illinois Appellate Court districts still require an employer to prove a legitimate business interest in enforcing a covenant not to compete. Because of this conflict between the various Appellate Court Districts, it is somewhat likely that this legal issue will be addressed and decided for the whole State of Illinois on appeal to the Illinois Supreme Court. Until that time, this decision will only apply to employers within the Fourth Appellate District.

1. Note that an Illinois employer will also be liable for sexual harassment under the IHRA if the employer becomes aware of the conduct and fails to take reasonable corrective measures, regardless of whether a supervisor is the harasser.

 

Originally published in the Winter 2009 edition of Quinn Quarterly.