BIPA litigation offers no legislative reprieve to employers – yet

As we previously reported, the Illinois Supreme Court held in Rosenbach v. Six Flags Enter. Corp. that Illinois employees do not have to allege actual harm to state a cause of action under the Illinois Biometric Information Privacy Act. Since this monumental decision, class action lawsuits under BIPA (mostly based purely on procedural violations), are being filed against Illinois employers at an alarming rate. In response, the Illinois Senate introduced SB2134, which would have amended BIPA by removing employees’ private right of action and instead provide for enforcement by the Department of Labor (for violations concerning employment-related biometric data collection) or by the state Attorney General under the state’s consumer protection statute.

However, the committee did not report the bill by the March 28, 2019 deadline, which likely signals the end of SB 2134 and its reprieve to Illinois employers from the wave of BIPA litigation. Prior legislative amendments to BIPA, House Bill 6074 and SB3053, also have failed. House Bill 6074 attempted to limit the definition of “biometric identifier” and “scan” while SB3053 would have made BIPA inapplicable to private entity collecting, storing, or transmitting biometric information if the biometric information is used exclusively for employment, human resources, fraud prevention, or security purposes.

With no imminent legislative action that would curtail the blitz of BIPA litigation since Rosenbach, it is critical that employers have the appropriate policies and procedures in place to comply with BIPA. This article provides an overview of BIPA, including compliance requirements for employers and statutory penalties for noncompliance, as well as best practices to avoid a BIPA lawsuit.

BIPA overview and compliance requirements

BIPA prohibits private entities from collecting, storing, or using biometric identifiers (such as fingerprints, retina or iris scans, voiceprints, and scans of hand or face geometry) or biometric information (any information derived from a biometric identifier used to identify an individual) for security scanning, time entry, paying wages or salaries, or any other reason, unless they first:

• Inform the employee in writing that you are collecting or storing their biometric information or biometric identifiers;
• Inform the employee of the applicable time span and specific purpose for collecting, storing, and using the employee's biometric information or biometric identifiers; and,
• Receive a written release from the employee (BIPA defines a "written release" as meaning "informed consent, or, in the context of employment, a release executed by an employee as a condition of employment").

Employers collecting, storing, or using biometric information or biometric identifiers also must:

• Develop a publicly available written policy that establishes a schedule for retaining biometric information and biometric identifiers, and guidelines for destroying such data when the purposes for collecting such data have been satisfied or within 3 years of the employee's last interaction with the employer, whichever happens first.
  
  • An employer is excused from compliance with its retention policy and destruction guidelines only by the issuance of a valid warrant or subpoena.
• Not sell, lease, trade or profit from an employee's biometric information or biometric identifiers.
• Not disclose or distribute the employee's biometric information or biometric identifiers unless the employee consents or production of such data is required under state or federal law or a valid warrant or subpoena.
• Store, transmit, and protect from disclosure an employee's biometric information or biometric identifiers in a manner that:
  
  • Meets the reasonable standard of care within the employer's industry, and
  • Is the same as or more protective than the manner in which the employer stores, transmits, and protects other confidential and sensitive information.

Significant penalties for noncompliance

BIPA gives every Illinois employee a right to sue a private employer who breaches its requirements. If the employer negligently violated BIPA, the employee can recover liquidated damages of $1,000 for each violation or actual damages, whichever is greater. For proven reckless or intentional violations, an employee can obtain liquidated damages of $5,000 for each violation or actual damages, whichever sum is more. In addition, a successful employee can recover attorneys' fees, costs, expert witness fees and other litigation expenses from an Illinois employer. Finally, an employee may obtain an injunction against the employer or other relief that a court finds appropriate.

What constitutes “each violation” is still an unresolved question. Does the violation occur only once at the initial collection of biometric information? Or are violations accruing each time the employee “clocks in” or “clocks out?” Regardless, the potential liability in the class action context is significant even if the most narrow interpretation of “each violation” is taken. For example, an employer with as few as 100 employees could face a judgment in excess of $500,000.00 in a class action suit if “each violation” means “each employee/class member.”

What employers should consider doing now

If your company is collecting, storing, or using biometric information or biometric identifiers for any purpose, you should consider the following proactive steps to limit and avoid liability from a BIPA claim:

1. Provide all employees with BIPA-compliant notice;
2. Obtain signed releases/consents from all affected employees;
3. Have in place a publicly available written policy regarding the collection, storage, use and destruction of biometric information and biometric identifiers;
4. Confirm that no biometric information or biometric identifiers are being sold or disclosed to third parties for any reason other than the limited exceptions permitted by BIPA;
5. Ensure that you, and any vendor that has access to your employees’ biometric information or biometric identifiers, have sufficient data privacy protocols and processes in place;
6. Ensure that your security incident response plan recognizes individual biometric information as personal information under Illinois laws concerning data breach notification requirements;
7. Train your employees on the above referenced policies and procedures;
8. Consider mandatory arbitration agreements with class action waivers; and,
9. If sued, consider removing to federal court where the law is more favorable to employers. For example, the Article III “injury-in-fact” standing requirement may bar BIPA claims when the plaintiff has not alleged to have suffered actual damages.

For more information or questions regarding BIPA specific issues, please contact Susan Lorenc, Jim Shreve, Ryan Gehbauer, or your Thompson Coburn attorney.