While COVID-19 has dominated the focus of managing Illinois employers this year, managing through the pandemic has not been their only challenge. In Illinois, a flurry of new wage and hour laws became effective in 2020—and despite the statewide shutdown and its aftermath, employers are bound to comply going forward into 2021.
Wage and hour compliance is serious business in the Land of Lincoln, where labor litigation occurs at higher-than-average rates. Don’t operate in Illinois? It’s still in your interest to know these laws. Like California, Illinois is a trendsetter state—and similar legislation may soon be coming your way.
Here are five key Illinois wage and hour laws that impact employers managing an hourly workforce—plus signature legislation in the city of Chicago that may have national implications.
1. The Illinois Human Rights Act (IHRA) Now Covers More Workers
Under the IHRA Workplace Transparency Act, not only are more workers protected under the IHRA, but more employers are subject to it.
Effective January 1, 2020, the IHRA applies to employers with one or more employees (it previously applied to employers with 15 employees or more).
In addition, the definition of protected categories of workers now covers those who are perceived to belong to one of them. And IHRA protections now cover non-employees, too, including contractors, consultants and vendors.
Employers should make sure their HR policies regarding discrimination and sexual harassment are adjusted accordingly.
2. Employer/Employee Agreements Now Subject to “Affirmative Obligations”
The IHRA Workplace Transparency Act also affects employer/employee agreements, including separation, severance, and non-compete contracts.
In a nutshell, any agreement that features non-disclosure or non-disparagement provisions must also:
- Be mutually beneficial to employers and workers
- Be negotiated and agreed upon
- Feature a 21-day consideration period
- Feature a 7-day revocation period
- Stipulate the employee’s right to an attorney review
Employers that have active agreements in place should review and amend them if necessary.
3. Employers Must Conduct Annual Sexual Harassment Training
Effective January 1, 2020, Illinois joined California, Delaware, Maryland and New York by requiring that all employers provide annual sexual harassment training.
In Illinois, 2020 training must be completed by December 31, 2020. Training can be provided internally or by a vendor (for example, EPAY’s offer sexual harassment training courses through EPAY Learning, our online learning management system).
4. Employers Must Complete Annual Harassment Judgements Disclosure Reports
Effective July 1, 2020, employers who’ve received final, non-appealable judgements with findings of sexual harassment—or other unlawful discrimination—must report it annually to the state. Those who don’t will face penalties.
The first report for 2019 data was due to IDHR by October 31, 2020. From this point on, reports will be due on July 1 of each year.
5. Illinois Employers Subject to “Race to $15” Minimum Wage Increases
This year, Illinois became the fifth state to join the “Race to $15”—a five-year initiative to raise minimum wage to $15 per hour by the year 2025.
On 7/21/2020, Illinois’ minimum wage was increased to $10 per hour. It will continue to increase by $1 every year on July 1, until it reaches $15 in 2025.
Of course, some local jurisdictions already have higher minimum wages in effect, including Cook County, Illinois ($13 per hour) and Chicago ($14 per hour).
Notable in Chicago: New Predictive Scheduling Law
Effective July 1, 2020, Chicago joined the list of localities with a Fair Workweek Ordinance. Under this law, city employers are required to provide written notice of work hours to employees at least 10 days in advance (increasing to 14 days in 2022).
While other cities have predictive scheduling laws in place, Chicago’s is the broadest in terms of the industries it impacts, including building services, healthcare, hotels, manufacturing, restaurants, retail and warehouse services.
Furthermore, the price of noncompliance is steep. In addition to fines, employers are required to provide predictability pay to workers should they make last-minute schedule changes (including half-pay to workers given less than 24-hour notice).
It should be noted that the state of Illinois frequently adopts labor laws passed in Chicago—and that fair workweek laws are part of a growing trend. Philadelphia also enacted one this year (affecting the hotel, retail and food service industries) and Los Angeles is considering one.
Helping Employers Maintain Labor Compliance
For more information about each of these laws—including how to ensure compliance—download our new report, States of Change: 2020 Wage & Hour Updates for the Hourly Workforce.
Of course, one of the best ways to maintain compliance is to use HR software which offer built-in safeguards, like EPAY HCM. Our system helps employers achieve labor compliance on the federal, state, and local levels through a combination of automated protections, extensive reporting and analytics, and an online learning system that facilitates compliance training for managers and employees. You’ll find more information when your review our 2020 compliance report!