Your employee is not trying to steal anything.
They are trying to finish a task faster. They paste your pricing model into ChatGPT to reformat it as a client proposal. They upload a draft contract and ask the AI to clean up the language. They feed your source code into the prompt to find a bug. They summarize a confidential internal investigation report to save time writing it up.
None of this feels like a security incident. It feels like using a tool.
If your promotion process, your DEI initiative, or your last round of layoffs has ever been shaped around demographic targets, the ground under your feet just shifted. On June 5, 2025, the Supreme Court ruled unanimously in *Ames v. Ohio Department of Youth Services* that majority group employees do not have to clear a higher legal bar to sue for discrimination than anyone else. That sentence sounds technical. It is not. It is a direct warning to every Illinois employer who has treated “reverse discrimination” claims as the rare, hard to prove exception.
Here is what changed, why it matters more in Illinois than most employers realize, and what to do about it before a claim lands on your desk.
It took eleven years.
In September 2015, a single Grubhub delivery driver named Raef Lawson filed a lawsuit in federal court arguing that Grubhub had misclassified him as an independent contractor when he should have been treated as an employee. The case wound through a decade of litigation, multiple appeals, shifting legal standards, and five formal mediation conferences.
In early 2026, Grubhub agreed to pay $24.75 million to settle. The class covers approximately 60,000 California delivery drivers who completed at least one Grubhub delivery between December 2014 and March 2026. The final approval hearing is scheduled for July 30, 2026.
Most business owners think of their employee handbook as a formality.
A document you put together when you hired your first few employees, maybe pulled from a template, maybe had someone review it years ago. It lives in a folder on a shared drive or in a stack of onboarding paperwork. New hires sign it. Nobody reads it closely. It sits there doing what you assume is its job.
Here is the problem. That assumption is costing Illinois businesses significant money, and it is creating legal exposure that most owners do not discover until they are already in litigation.
If your company uses software to screen resumes, score job applicants, schedule interviews, evaluate performance, or decide who gets promoted, you may already be violating Illinois law.
That is not a hypothetical. It is the current legal reality for employers operating in Illinois as of January 1, 2026.
A lot of business owners in the Chicago area know AI tools are somewhere in their hiring process. What most do not know is that Illinois now treats the misuse of those tools as a civil rights violation, with penalties that can reach $70,000 per violation, plus actual damages and attorneys’ fees. And critically, intent does not matter. If your AI produces a discriminatory outcome, you are liable whether you meant for that to happen or not.
What is the current status of noncompetes?
The FTC’s sweeping 2024 rule that would have banned nearly all noncompete agreements nationwide never took effect. Federal courts blocked it, and the FTC formally abandoned its appeal. There is currently no federal ban on noncompetes.
What about Illinois?
What happened?
The Seventh Circuit Court of Appeals held in Clay v. Union Pacific Railroad Co. that the 2024 amendment to Section 20 of the Illinois Biometric Information Privacy Act applies to cases that were already pending when the amendment took effect on August 2, 2024.
What does that mean?
What changed? Illinois strengthened pay transparency mandates, expanded personnel file access rights, tightened pay stub requirements, broadened anti-discrimination protections to cover family responsibilities and reproductive health decisions, added restrictions on AI used in hiring, tightened severance and confidentiality agreement rules, and extended employee rights regarding employer-issued devices under VESSA, all effective in 2025–2026.
Who is affected? Most Illinois employers, particularly those with 15 or more employees, and any business that uses third-party recruiting tools, applicant tracking software, or staffing agencies.
What should you do now? Conduct a focused employment law audit covering job postings, payroll stubs, personnel file procedures, employee handbooks, AI-enabled vendor contracts, severance templates, and company-device policies.
Most business owners don’t consider themselves facing an employment issue.
Until they do.
And when they do, it’s usually costly, disruptive, and entirely preventable.
Illinois business owners have been closely following developments under the Corporate Transparency Act (“CTA”), particularly given the uncertainty created by conflicting court decisions and shifting enforcement positions. A recent federal appellate ruling provides important legal clarity, although practical compliance obligations for Illinois entities remain limited for now.
Federal Appellate Court Upholds the CTA
On December 16, 2025, the United States Court of Appeals for the Eleventh Circuit issued a unanimous decision in National Small Business United v. U.S. Department of the Treasury, holding that the CTA is constitutional. This ruling overturned a March 2024 federal district court decision that had invalidated the statute.
Chicago Business Attorney Blog