Illinois Court Says Action for Statutory Damages Under Biometric Act Not Barred by Exclusivity

Falling in line with several federal decisions that had earlier ruled on the issue, an Illinois appellate court held the exclusive remedy provisions of the state’s Workers’ Compensation Act do not bar an employee’s claim for recovery for statutory damages under the Biometric Information Privacy Act [McDonald v. Symphony Bronzeville Park Lic., 2020 IL App (1st) 192398, 2020 Ill. App. LEXIS 627 (Sept. 18, 2020); see 740 ILCS 14/1 et seq.]. The court stressed that it was only considering the claim for statutory damages. It was not called upon to decide—and did not decide—whether a claim against an employer for “actual” damages resulting from a violation of the Biometic Act might be barred.

Background

McDonald filed this class action lawsuit against her employer, alleging that she and others were entitled to statutory damages based on the employer’s violation, along with the other defendants, of the state’s Biometric Information Privacy Act (Privacy Act), 740 ILCS 14/1 et seq. In a separate count within her initial complaint, McDonald sought actual damages also for “mental anguish and mental injury” caused by the alleged violations.

When the employer (and other defendants) moved to dismiss on grounds that the action was barred by the exclusive remedy provisions of the Illinois Workers’ Compensation Act, McDonald was granted leave to file an amended complaint that removed the common law negligence claim that sought actual damages. In that manner, the operative complaint sought recovery of liquidated damages under the Privacy Act, not any other actual damages.

The trial court denied the motions to dismiss and, as relevant here, rejected the assertion that the Compensation Act preempted claims by an employee against an employer under the Privacy Act. The employer was granted an interlocutory appeal.

Appellate Court Decision

The appellate court noted that the certified question specifically asked it to consider the applicability of the Compensation Act's exclusivity provisions to a claim against an employer by its employee for "statutory damages," not to a claim for any greater amount of "actual damages." The court acknowledged the broad exclusive remedy provisions of the state’s Compensation Act, but, citing Folta v. Ferro Engineering, 2015 IL 118070, ¶ 14, 397 Ill. Dec. 781, 43 N.E.3d 108, noted four exceptions if the employee established that the injury:

1. Was not accidental;
2. Did not arise from the employment;
3. Was not received during the course of employment; or
4. Was not compensable under the Compensation Act.

Whether Injury “Categorically Fits” Within the Compensation Act

Analyzing three Illinois Supreme Court decisions, the appellate court indicated an injury is compensable under the Compensation Act if the the type of injury “categorically fits” within the purview of the Act. The case law did not stand for the proposition that whether an injury was compensable was defined by whether there was an ability to recover benefits for a particular injury sustained by an employee [Opinion, p. 16, again citing Folta]. Citing an earlier decision on the issue by a federal court, Treadwell v. Power Solutions, International, Inc., 427 F. Supp. 3d 984, 992 (N.D. Ill. 2019) (for a more elaborate discussion of Treadwell click here and here), the appellate court added that “the Folta court made clear that this inquiry is broader than just whether an injury arises out of and in the course of employment and does, to some extent, consider the character of the injury.”

The appellate court continued:

In light of the above discussion, we fail to see how a claim by an employee against an employer for liquidated damages under the Privacy Act—available without any further compensable actual damages being alleged or sustained and designed in part to have a preventative and deterrent effect—represents the type of injury that categorically fits within the purview of the Compensation Act, which is a remedial statute designed to provide financial protection for workers that have sustained an actual injury [Opinion, p. 21].

The court concluded, therefore, that the exclusivity provisions of the Compensation Act did not bar a claim for statutory, liquidated damages, where an employer was alleged to have violated an employee's statutory privacy rights under the Privacy Act, as such a claim was simply not compensable under the Compensation Act. The court noted several prior decisions from federal courts, including Treadwell, cited above, that were consistent with its decision.