1. Defensive Employment Practices Associated with Reductions In Force
Illinois Municipal League
MUNICIPAL ATTORNEYS SEMINAR
March 19, 2010
Stephen W. Heil
Cray Huber Horstman Heil & VanAusdal LLC
Chicago, Illinois

2. WHAT SHOULD BE CONSIDERED?
Planning and implementing the Reductions in Force (“RIF”)
Selection criteria
Disparate impact
Providing notice
Severance pay issues
Releases
Compliance with employee benefits laws

3. PLANNING AND IMPLEMENTING
Put yourself in the employee’s place
Treat employees as you would like to be treated
Communicate honestly and directly before, during and after RIF
Assistance for employees
Ease transition – immediate and future
Why do these things?

4. RIF PLAN
Municipalities - unlike private sector - generally not free to simply restructure work forces “at will.”
Especially if employees are “protective service” (fire or police) or the employees are union affiliated.
Can’t reduce force due to political reasons, i.e., retaliation for campaigning for opposing party.
Fire or police – can reduce force due to economic reasons but seniority prevails on reinstatement of positions.
Timetable
Assign responsibilities
Implement carefully, but promptly
Review all legal obligations
Contracts
Policies and procedures
Applicable laws, i.e., Civil Service Act of IL, Municipal Code, IL Public Labor Relations Act, Fire & Police Commissioners Act, etc.

5. VOLUNTARY DEPARTURES SELECTION CRITERIA Early retirement incentives
Exit incentives
Key employee incentives
Golden parachute
Stay bonus
SELECTION CRITERIA
Any written obligations or guidelines
Who decides criteria
Independent review by HR of selections

6. DISPARATE IMPACT
Does selection criteria and/or implementation adversely impact protected classifications?
Snapshot: pre-RIF employee makeup vs. RIFd employees vs. post-RIF employee makeup
Disproportionate Impacts on protected classes (racial, gender, handicap, etc.) need to be avoided even if the reason for the reduction was “facially neutral”
Alternatives To RIF? (Transferring and retraining)
Replacements for RIF-Issues to keep in mind:
who will do their work
limits on replacements – state laws re: police/fire

7. UNION ISSUES C.B.A. requirements
Duty to bargain – mandatory if the matter concerns wages, hours, and terms and conditions of employment under the Illinois Public Labor Relations Act.
Bargaining over decision v. effects of the decision to reduce force

8. NOTICE Employers covered
Federal Worker Adjustment and Retraining Notification Act (“WARN”) - Applicable to Municipalities
Employer must provide 60 days advance notice of a mass layoff or plant closing
Employers covered
Employers with 100 or more “full-time” employees
Or 100 or more employees who, in the aggregate, work at least 4,000 hours of straight time a week
IL WARN Law: Inapplicable to federal/state government or any political subdivisions, including any unit of local government or any school district.

9. SEVERENCE PAY Exiting plan Voluntary ERISA? Mandatory v. discretionary
Transfers
Release

10. SEPARATION AGREEMENT Date of termination What will be given and when
Continuation of any existing obligations
Recall/reemployment rights

11. RELEASE Older Workers Benefits Protection Act (“OWBPA”) Group Release
Knowing and voluntary
Easily understood
Consideration
Release of specific rights
ADEA
Present, not future rights
Advise to consult with attorney prior to signing
At least 21 days to consider signing
Seven (7) days to revoke
Group Release
Provide group information and allow at least 45 days to consider signing – employer must provide ages of both terminated and retained employees to those considering a release of their ADA claims

12. Defensive Employment Practices Associated with Reductions In Force
Stephen W. Heil
Ronald L. Wisniewski
Cray Huber Horstman Heil & VanAusdal LLC
303 West Madison, Suite 2200
Chicago, Illinois
(312)