By: Matthew J. Hammer

Two recent decisions from the Northern District of Illinois offer a glimpse into how courts could limit employee class actions under the Illinois Biometric Information Privacy Act (“BIPA”). In those cases, the courts dismissed claims against airlines on the ground they were subject to mandatory arbitration under the federal Railway Labor Act (“RLA”). The recent decisions suggest that collective bargaining agreements (“CBAs”) may provide fertile defensive grounds against employee statutory actions, even for industries where the collective bargaining process is not governed by the RLA.

Congress passed the RLA to promote stability in labor-management relations by providing a comprehensive framework for resolving labor disputes involving airlines and railroads. The RLA framework includes “major” and “minor” disputes. Major disputes are those that create contractual rights, such as rates of pay, rules or working conditions. Major disputes, ultimately, may be considered by the courts. Minor disputes, on the other hand, grow out of the interpretation or application of existing CBAs and when resolution of a claim requires interpretation of a CBA, the claim is subject to mandatory and exclusive arbitration under the RLA. Embedded in the RLA is a strong preference for arbitration, as opposed to judicial resolution of disputes.

In Johnson v. United Air Lines, a union baggage handler at O’Hare International Airport filed a BIPA lawsuit seeking statutory damages on behalf of himself and those similarly situated arising out of United’s timekeeping practices. United, like many employers, utilized plaintiff’s fingerprints to track when he signed in and out of work. In collecting the fingerprint data of its employees, United allegedly did not obtain employee consent before using and transmitting the biometric information, as required by BIPA. United moved to dismiss the claim pursuant to the RLA, arguing that the BIPA claim was a “minor dispute” under the plaintiff’s CBA.

The court agreed. Citing rather boilerplate language in the CBA, the court ruled that “there is no way for the Plaintiff to pursue a BIPA claim without interpreting the existing CBA between United and [plaintiff’s union].” Indeed, the applicable CBA provided United with the “sole and exclusive right to manage, operate, and maintain the efficiency of the business and working forces,” including the ability to “maintain discipline and efficiency in the Company’s facilities.” In exercising these rights, United opted for a timekeeping system utilizing fingerprint technology. Thus, any challenge to the use of fingerprints as a means of managing the efficiency of its business and work forces would require interpretation of the CBA in arbitration proceedings as mandated by the RLA.

In a puzzling subsequent order, the court remanded the case to the Circuit Court of Cook County, Illinois because the baggage handler did not allege a “concrete injury” but sought only statutory damages. The court’s conclusion appears to be at odds with the Illinois Supreme Court’s decision in Rosenbach v. Six Flags, in which it held that a plaintiff suffers a “real and significant” injury when “a private entity fails to adhere to the statutory procedures” in BIPA. This may be the federal court’s message to the Illinois court that, if no actual damages exist, the state court can handle the cases, but should not preclude the preemption defense in the state court.

In Miller v. Southwest Airlines, ramp and operations agents represented by a labor union filed a BIPA lawsuit based on Southwest’s biometric timekeeping and payroll system that required employees to scan their fingerprints to sign in and out of work. The employees also filed common law claims for intrusion upon seclusion, conversion, negligence, fraud, and breach of contract. In the face of allegations similar to those in Johnson, Southwest moved to dismiss, arguing that the claims were subject to mandatory arbitration under the relevant CBAs and the RLA. Notably, and contrary to the Johnson order, the court determined that the employees alleged a concrete injury, such that the court had jurisdiction over the claims.

Relying on case law including Johnson and broad, commonplace CBA language, the court determined that the employees’ claims constituted minor disputes preempted by the RLA because they required interpretation of and reference to the CBAs that governed the employees’ rates of pay, rules, and working conditions. To resolve the claims, the court would have to:

  • interpret the scope of the union’s authority as the “sole and exclusive bargaining agent” to consent to the use of the timekeeping system on behalf of the employees;
  • determine whether Southwest acted within its authority under the CBAs, including within its broad grants of authority to “manage and direct the work force” and to govern covered employees “by all reasonable Company rules and regulations”;
  • consider the parties’ bargaining history with respect to wages and working conditions;
  • interpret the CBAs’ wage provisions; and
  • interpret the CBAs’ grievance system and arbitration procedure.

Accordingly, the court dismissed the BIPA and common law claims and ordered that the claims be submitted to arbitration. The court also denied the employees leave to file a second amended complaint asserting only a BIPA claim, reiterating that the claim remains preempted by the RLA.

The plaintiffs in Miller v. Southwest appealed the district court’s decision and the case is currently pending before the Seventh Circuit Court of Appeals.

Significantly, BIPA preemption may not be limited to cases governed by the RLA. Implicit in the Miller and Johnson rulings is the principle that unions may bargain away their members’ statutory rights under BIPA. This is in accord with other Illinois decisions. E.g., Matthews v. Chicago Transit Authority, 2016 IL 117638 (2016), ¶68 (recognizing that “a union can waive statutory and economic rights on behalf of its members”). Whether unions can waive their members’ BIPA rights is one of the issues that is likely to be addressed by the Seventh Circuit in Miller.

These decisions concerning the RLA and BIPA are encouraging for railroads, airlines, and other industries where labor issues are governed by CBAs, but this is obviously a developing area of Illinois privacy law. DMG continues to follow developments in this area, including the Seventh Circuit’s consideration of the Miller v. Southwest Airlines decision, the Johnson v. United Air Lines litigation, and the BIPA litigation environment forming in the wake of Rosenbach v. Six Flags.