A recently released report from the Chamber of Progress showed a massive spike in litigation against employers in the wake of Illinois’ Biometric Information Privacy Act (BIPA), including 1,400% increases in lawsuits and nearly $1 billion in class action settlements. Similar proposed legislation in other states risks further litigation for employers.
Lawsuits skyrocketing: Beginning in 2019, when the Illinois Supreme Court ruled that BIPA plaintiffs do not need to prove actual harm caused by violations, lawsuits filed against employers jumped considerably. This includes a 1,400% increase in one year alone.
Timekeeping, employers main target: 88% of the BIPA litigation examined in the report involved employer-employee disputes over biometric timekeeping. The statute has several notice and consent requirements for employee biometric timekeeping, and prohibits disclosure of any such data collected to third parties.
Plaintiffs’ attorneys profit above all else: BIPA lawsuits have generated nearly $1 billion in class action settlements. The largest beneficiaries, perhaps unsurprisingly, are plaintiffs’ attorneys, who have received an average of $11.5 million per case, while individual plaintiffs themselves receive only $506 on average.
More to come? At least six states are considering similar biometric privacy laws, and the report warns that “similar legislation...will likely lead to similar increases in litigation, increased business costs...and limited benefits for consumers.” The report advocates for more moderate approaches to biometric privacy regulation to avoid results similar to those in Illinois.
Outlook: Illinois’ BIPA has created “tremendous liability risk for companies due to astronomical accruals,” and impacted companies may be faced with the reality of having to phase out operations in the state as a result. Pending legislation in other states could create similar negative consequences for companies, and employers should monitor the changing state legal landscape regarding privacy issues.