New Laws Impacting Illinois Employers in 2016 and Beyond

E. Jason Tremblay

E. Jason Tremblay

While Illinois appears to be in legislative gridlock on a wide variety of political and legislative fronts, it has become abundantly clear that such gridlock has not curtailed the passage of employment and labor-related legislation in Illinois. The following are highlights of seven new laws impacting Illinois employers in 2016 and beyond.

  1. Paid Sick Leave In Chicago and Cook County
    Effective July 1, 2017, employers who have at least one (1) employee in Chicago or Cook County are obligated to provide paid sick leave for those employees who work at least 80 hours within any 120-day period, provided they work at least 2 hours in any 2-week period within Chicago or Cook County. Specifically, covered employers are required to offer 1 hour of paid sick time for every 40 hours worked, which can be capped at 5 paid sick days each year unless the employer sets a higher limit. Up to 20 hours of accrued but unused sick leave may also be carried over into the next 12-month period. Sick leave can be used for the employee’s own illness or the illness of or medical treatment for the employee’s family member (which is broadly defined
  2. The Illinois Employee Sick Leave Act
    Effective January 1, 2017, Illinois employers that currently provide sick leave benefits to their employees must allow the employees to use their personal sick leave benefits for absences due to the illness, injuries, or medical appointments of their family members. In short, employers cannot limit sick leave to just the employee’s sickness. This law does not require employers (outside the city of Chicago or Cook County) to offer sick leave benefits; however, if they do provide sick leave benefits, employees must be allowed to take such leave for any illnesses or other sickness-related matters of their family members. “Family members” are defined broadly under the Act and include immediate family, parents-in-law, grandchildren, grandparents, or step parents.
  3. The Illinois Freedom to Work Act
    Effective January 1, 2017, the Illinois Freedom to Work Act will prohibit private sector employers from entering into non-compete agreements with low-wage employees. “Low-wage” employees are defined as those that make less than the greater of (a) the federal ($7.25 per hour), State ($8.25 per hour), or local (currently $10.50 per hour under the Chicago Minimum Wage Ordinance) minimum wage; or (b) $13.00 per hour. Significantly, while the Act prohibits non-compete provisions, it does not affect an employer’s right to protect confidential information and trade secrets or to prohibit the solicitation of other protected relationships, such as customers.
  4. Child Bereavement Leave Act
    Effective immediately upon its passage on July 29, 2016, the Child Bereavement Leave Act makes Illinois one of only two states in the country to require covered employers to provide unpaid leave in the event of the death of the employee’s child. Specifically, the Act requires employers with 50 or more employees to provide eligible employees with up to 2 weeks (10 working days) of unpaid leave, also known as child bereavement leave. Employers and employees under the Act are defined in the same way as they are under the Federal Family and Medical Leave Act (FMLA). Therefore, employees who are eligible to take FMLA leave and employers that are required to provide leave under the FMLA also fall under the Act’s provisions. Under the Act, a “child” is defined broadly as an employee’s son or daughter who is biological, adopted, or a foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis. If an employee loses more than one child in a 12-month period, the employee is entitled to take up to 6 weeks of unpaid leave in that 12-month period.
  5. Illinois Secure Choice Savings Program
    Passed by Governor Quinn in June 2015, but not mandated for Illinois employers until June 1, 2017, the Illinois Secure Choice Savings Program mandates that Illinois employers with 25 or more employees (and who have been in business for 2 or more years) provide a retirement savings program to their employees. The covered employer must offer a retirement savings plan to employees or automatically enroll employees in a retirement plan to be set up by the State. Employees have the choice to “opt out” of the plan but they must affirmatively do so in writing. If the employee does not opt out, covered employers must deduct 3% of the employee’s compensation and deposit it in the State plan.
  6. Chicago and Cook County Minimum Wage
    Currently, the Chicago minimum wage is $10.50 per hour. On July 1, 2017, it will increase to $11.00 per hour. Thereafter, on July 1, 2018, and July 1, 2019, it will be incrementally raised to $12.00 and $13.00 per hour, respectively. Cook County is also implementing its own minimum wage increase with a slight delay after Chicago. The Cook County Ordinance provides that the first increase to $10.00 an hour will take effect on July 1, 2017. Thereafter, the minimum wage will rise $1.00 per year until it is $13.00 an hour on July 1, 2020. Thereafter, any annual increases will be subject to the rate of inflation not to exceed 2.5% per year. One notable difference between the Chicago and Cook County ordinances is that, in Cook County, tip workers, who are required to be paid a cash wage of $4.95 per hour under Illinois law, will have a cash wage increase subject to the rate of inflation starting on July 1, 2018. This cash wage increase to tip workers could have a significant impact on the restaurant and hospitality industries, which maintain a large portion of their work forces by employing tipped workers.
  7. FLSA Overtime Regulations Stayed
    Scheduled to take effect on December 1, 2016, the highly anticipated Department of Labor FLSA Overtime regulations were stayed by a Federal District Court in Texas on November 22, 2016. The final regulations were set to double the salary level for employees deemed to be exempt from overtime under the Fair Labor Standards Act. For the time being, these regulations appear to be temporarily stayed, but a closer look at the opinion suggests that the Department of Labor may have, according to the Judge, overstepped its authority and, as a result, we are not anticipating the planned overtime regulations to come into effect any time in the immediate future.

Should you have any questions regarding new laws, please contact E. Jason Tremblay at (312) 876-6676 or your designated Arnstein & Lehr LLP attorney.

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Early Holiday Present For Employers – Overtime Regulations Stayed

E. Jason Tremblay

E. Jason Tremblay

In a last minute blow to the Obama Administration’s labor and employment legacy, a federal district court in Texas granted an emergency motion for preliminary injunction yesterday barring the Department of Labor from enforcing its revised overtime rules, scheduled to take effect on December 1, 2016. See decision here.

The final regulations were poised to double the salary level for employees deemed to be exempt from overtime under the Fair Labor Standards Act pursuant to the Department of Labor’s “white collar” exemptions.

Though I am in the midst of traveling with my family for the Thanksgiving holiday, the court’s sudden decision urges me to provide some swift thoughts and suggestions.

First, it appears that this injunction is nationwide and therefore would apply to all employers throughout the country.

Second, it is uncertain how long this injunction will stay in place. It may become permanent, but the regulations are now only temporarily stayed meaning the regulations will NOT become effective, as originally scheduled, on December 1st.

Third, for those employers who have already communicated salary and compensation changes in anticipation of the update, you can either still go through with the salary and compensation changes despite the ruling or, alternatively, delay or cancel the changes. If you decide to delay or cancel the changes, you will want to communicate something in writing to the affected employees (and soon) explaining the sudden change.

For those companies who have already changed compensation in anticipation of the updated regulations, it will be much more difficult to roll back the salary and compensation changes without causing a mutiny in the workforce. In that case, a business decision will need to be made as to whether it is worth rolling back the changes after compensation plans have already been made and implemented.

This is a lot to chew on days before the planned effective date for the updated regulations, but is likely welcome news for many employers as well. We will keep you advised of developments in this area.

In the meantime, if you have any questions regarding this significant development, of if you need assistance evaluating how this development impacts your company, please do not hesitate to contact me at 312-876-6676.

Happy Thanksgiving.

New Form I-9 Goes Into Effect On January 21, 2017

E. Jason Tremblay

E. Jason Tremblay

A revised Employment Eligibility Verification Form I-9, which is required to be filled out for every new employee, was recently issued by the U.S. Citizenship and Immigration Services. The new version is here. Among other changes to the form, Section 1 now asks to provide “other last names used” and streamlines the certification for certain foreign nationals.

The current version of the Form I-9 will continue to be valid until January 21, 2017. After this date, employers will be required to use the new form.

Fines for Form I-9 infractions can be steep so you should commence using the updated Form I-9 form immediately.

Should you have any questions regarding the new Form I-9 or how it has changed, please contact E. Jason Tremblay at (312) 876-6676 or your designated Arnstein & Lehr LLP attorney.

Cook County to Raise Minimum Wage

E. Jason Tremblay

E. Jason Tremblay

Last week, the Cook County Board of Commissioners voted to gradually raise the minimum wage to $13/hour by July 2020. This increase comes more than a year after Chicago began implementing its own minimum wage increase within the City.

The Cook County Ordinance provides that the first increase to $10/hour will take effect on July 1, 2017. Thereafter, the minimum wage will rise $1/hour per year until it is $13/hour on July 1, 2020. Any subsequent annual increases will be subject to the rate of inflation, not to exceed 2.5% per year.

Notably, and unlike the City of Chicago Ordinance, the Cook County Ordinance provides that tipped workers, who are required to be paid a cash wage of $4.95 under Illinois law, will have a minimum wage increase subject to the rate of inflation starting on July 1, 2018 (not to exceed 2.5% per year). As you can imagine, this pay increase to tipped workers could have a significant impact on the restaurant and hospitality industries, which maintain a large portion of their workforces by employing tipped workers.

The Cook County law will apply to the entire County, including unincorporated areas of Cook County. However, home-rule towns within the County can opt out of the minimum wage increase.

Should you have any questions regarding this minimum wage increase, or how and when it will impact your company, please do not hesitate to contact E. Jason Tremblay at 312-876-6676 or your Arnstein & Lehr LLP employment and labor attorney.

Cook County Approves Paid Sick Leave Ordinance

Kellie Y. Chen

Kellie Y. Chen

On October 5, the Cook County Board of Commissioners approved the Cook County Employer Paid Sick Leave Ordinance (the “Ordinance”) requiring employers to provide paid sick leave to their employees, to take effect on July 1, 2017. This Ordinance follows in the wake of the City of Chicago approving a similar paid sick leave ordinance in late June that is also to come into effect in July of 2017, as addressed in E. Jason Tremblay’s June 29 blog post, “Paid Sick Leave is Coming to Chicago.”

Paid Sick Leave Under the Ordinance

The Ordinance applies to any employer that has at least one covered employee and has its principal place of business within Cook County. The Ordinance only covers employees who work at least 80 hours within any 120-day period and work at least 2 hours in any 2-week period within the geographic boundaries of Cook County.

Covered employers are required to offer 1 hour of paid sick time for every 40 hours worked. Eligible employees can accrue up to 5 paid sick days each year, unless their employer sets a higher limit. Earned sick leave will begin to accrue either on the first calendar day after an employee’s employment or on the effective date of the Ordinance, whichever comes later.

If a covered employee has not used up all of his or her accrued sick leave by the end of the 12-month period, then they can carry over up to 20 hours of unused accrued sick leave. For larger employers covered by the Family Medical Leave Act, employees are allowed to carry 5 days (40 hours) of unused paid leave into the next year.

However, if an employer has a policy that grants employees paid time off in a manner meeting requirements for earned sick leave under the Ordinance, then the employer is not required to provide additional paid leave. If the employer’s policy immediately awards paid time off instead of using an accrual model, then the employer has to award 40 hours of paid time off within 1 calendar year of the employee’s date of eligibility.

Use of Sick Leave

Pursuant to the Ordinance, employers can prohibit employees from beginning to use earned sick leave until 180 days after their earned sick leave begins to accrue. Employers also have the right to obligate employees to use sick leave in reasonable increments of 4 hours or less per day. However, employers are prohibited from requiring employees to find a replacement worker to cover the hours during which they are on paid sick leave.

Employees can use sick leave for the following reasons: (1) the employee is ill or injured, or is receiving medical care, treatment, diagnosis or preventative medical care; (2) the employee’s family member is ill or injured, or the employee needs to care for a family member receiving medical care, treatment, diagnosis or preventative medical care; (3) the employee or his or her family member is a victim of domestic violence or is the victim of sexual violence or stalking; or (4) a public official closes the employee’s place of business because of a public health emergency, or the employee needs to care for a child after a public official has closed the child’s school or place of care because of a public health emergency. The Ordinance’s broad definition of “family members” includes, but is not limited to, immediate family, parents-in-law, grandchildren, grandparents, step-family, and adopted or fostered children.

If an employee’s need to use earned sick leave is reasonably foreseeable (such as for prescheduled appointments), an employer may require up to 7 days’ notice before leave is taken. If it is not reasonably foreseeable, then the employer may require an employee to give notice as soon as is practicable on the day the employee needs to take sick leave. This requirement is waived if the employee cannot give notice because he or she is unconscious or otherwise medically incapacitated. If an employee is absent for more than 3 consecutive days at work, the employee may require documentation certifying that the employee’s use of earned sick leave was authorized.

The Ordinance’s Impact on Employers

All covered employers – those who currently provide sick leave or who will be required to under the Chicago Paid Sick Leave Ordinance and/or Cook County Paid Sick Leave Ordinance – should update their employee handbooks and/or leave policies to address the Ordinance’s requirements and should post and provide notice to employees of their rights under the Ordinance.

Additionally, employers should be aware that they are prohibited from retaliating or taking any other adverse actions against employees who exercise their rights, or attempt to do so, under the Ordinance. Aggrieved employees may seek recourse in state court for damages up to three times the unpaid or denied sick time plus interest for violations of the Ordinance

Should you have any questions regarding the Cook County Employer Paid Sick Leave Ordinance or need assistance updating your policies in order to comply with the Ordinance, please contact Kellie Y. Chen at 312-876-7837, E. Jason Tremblay at 312-876-6676 or your designated Arnstein & Lehr LLP attorney.

Illinois Employee Sick Leave Act and Its Impact on Employers

Kellie Y. Chen

Kellie Y. Chen

Employee Sick Leave Act

On August 19, 2016, Governor Bruce Rauner signed into law the Employee Sick Leave Act, Public Act 99-0841 (the Act), which goes into effect on January 1, 2017. The Act requires Illinois employers that currently provide sick leave for employees to allow employees to use their personal sick leave benefits for absences due to illnesses, injuries, or medical appointments of their family members. In short, under the Act, employees can use their personal sick leave for their family members’ medical needs just as they would be able to use their personal sick leave for their own illnesses or injuries.

The Employee Sick Leave Act covers Illinois employers who already provide personal sick leave benefits to their employees, and does not require employers to create and provide such benefits. However, under the Chicago Paid Sick Leave Ordinance, effective on July 1, 2017, many employers in Chicago will be required to provide eligible employees with paid sick leave benefits. This Act will therefore apply to those employers covered under the Chicago Paid Sick Leave Ordinance when it becomes effective in July, as addressed in E. Jason Tremblay’s June 29 blog post, “Paid Sick Leave is Coming to Chicago.”

Personal Sick Leave Under the Act

The Employee Sick Leave Act defines “personal sick leave benefits” to include the time accrued and available to employees to be used for absences from work due to personal illness, injury, or medical appointments. Additionally, “family members” are defined broadly to include immediate family, parents-in-law, grandchildren, grandparents, or stepparents. The Act provides that employees can take leave for “reasonable periods of time” (within the available sick leave under the applicable policy) depending on whether the employees’ attendance is necessary. The Act, however, does not extend the maximum period of leave provided under the Family and Medical Leave Act. Employers can further limit the amount of leave taken for an employee’s family medical care to the amount of personal sick leave that an employee would have accrued over six months at the employee’s accrual rate. Employees are also unable to use these benefits for absences from work when their employer has a plan that already provides compensation for their absences.

The Act’s Impact on Employers

All covered employers – those who currently provide sick leave or who will be required to under the Chicago Paid Sick Leave Ordinance – should update their employee handbooks and/or leave policies to address the Employee Sick Leave Act’s requirements and to provide notice to employees of their rights under the Act. Employers who already have paid time off policies that provide leave benefits for family medical needs are not required to modify their policies. Additionally, employers should be aware that they are prohibited from retaliating or taking any other adverse actions against employees who exercise their rights, or attempt to do so, under the Employee Sick Leave Act. Aggrieved employees may seek recourse either before the Illinois Department of Labor or in state court for violations of the Act.

Should you have any questions regarding the Employee Sick Leave Act or need assistance updating your policies in order to comply with the Act, please contact Kellie Y. Chen at 312-876-7837, E. Jason Tremblay at 312-876-6676 or your designated Arnstein & Lehr LLP attorney.

Illinois Prohibits Non-Competition Agreements for Low-Wage Employees

E. Jason Tremblay

E. Jason Tremblay

Governor Bruce Rauner recently signed into law the Illinois Freedom to Work Act (the Act), which will prohibit private sector employers from entering into non-compete agreements with low-wage employees. The Act defines low-wage employees as those who earn the greater of: (a) the Federal ($7.25 per hour), State ($8.25 per hour), or local (currently, $10.50 per hour under the Chicago Minimum Wage Ordinance) minimum wage; or (b) $13.00 per hour.

A covenant not to compete entered into between an employer and a low-wage employee is considered illegal and void under the Act. The Act defines a prohibited “covenant not to compete” as an agreement that would prohibit a low-wage employee from: (a) working for another employer for a specified period of time; (b) working in a specified geographic area; or (c) engaging in similar work for another employer.

Significantly, while the Act prohibits non-compete provisions, it does not affect an employer’s right to protect confidential information and trade secrets or to prohibit the solicitation of otherwise protected relationships through, for example, a non-solicitation provision.

The Illinois Freedom to Work Act is effective January 1, 2017 and allows private litigants to pursue declaratory relief when there is a judiciable controversy over their own non-compete agreement.

This Act follows a lawsuit recently by the Illinois Attorney General involving the sandwich chain Jimmy John’s use of non-competition agreements to prevent lower paid hourly workers from working at competitors of Jimmy John’s, as well as a general trend throughout the country of cases challenging the enforceability of non-compete agreements with low-wage employees.

Should you have any questions regarding the Illinois Freedom to Work Act, please do not hesitate to contact E. Jason Tremblay at 312-876-6676 or your Arnstein & Lehr LLP employment and labor attorney.

5th Edition of Employment Law Toolkit for Illinois Employers is Now Available

Employment Law ToolkitArnstein & Lehr LLP Chicago Partner, E. Jason Tremblay, has published the 5th Edition of his book entitled “Employment Law Toolkit for Illinois Employers – How to Protect Your Business From Liability and Comply with State and Federal Employment Laws.” 

This 182-page book provides an excellent summary of federal and state employment and labor laws facing employers. It also serves as an excellent resource for employers, business professionals and entrepreneurs to protect themselves from employment and labor-related liability. Among other topics in this new edition of the Toolkit are trending topics such as the updated Fair Labor Standard Act regulations, restrictive covenant law developments, worker classification issues, as well as a wide range of other legal topics impacting employers in today’s litigious environment. 

Should you want to order a courtesy copy of the Toolkit, please contact E. Jason Tremblay at ejtremblay@arnstein.com or at (312) 876-6676.

New Illinois Law Provides For Unpaid Child Bereavement Leave

Kellie Chen Kellie Y. Chen

On July 29, 2016, Governor Rauner signed the Child Bereavement Leave Act (the “Act”), making Illinois one of only two states (Oregon being the first in 2014) to require covered employers to provide unpaid leave in the event of the death of an employee’s child.  The Act, effective immediately, requires employers with 50 or more employees to provide employees with up to two weeks (10 working days) of unpaid leave, also known as child bereavement leave.

Employers and employees under the Act are defined in the same way as they are under the Family and Medical Leave Act (“FMLA”).  Therefore, employees that are eligible to take leave and employers that are required to provide leave under the FMLA also fall under the Act’s provisions. 

However, the Act does not create a right for employees to take unpaid leave that exceeds the unpaid leave time available under the FMLA.  For example, an employee who has already used all of his or her 12 weeks of FMLA leave cannot take an additional 10 working days because of the death of his or her child (unless the employer chooses to provide additional leave). In the alternative, employees may elect to substitute paid leave for unpaid leave under the Act, but employers may not require employees to do so.

Child Bereavement Leave Under the Act

Under the Act, a “child” is defined broadly as “an employee’s son or daughter who is a biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis.” 

Employees may use child bereavement leave for the following reasons:

(1) to attend the funeral or an alternative to the funeral, of a child;

(2) to make arrangements necessitated by the death of a child; or

(3) to grieve the death of a child.

An employee must take child bereavement leave within 60 days after he or she receives notice of the death of a child, and if an employee loses more than one child in a 12-month period, then he or she is entitled to take up to six weeks of unpaid leave in that 12-month period.

Employees must give their employers at least 48 hours’ advance notice of their intent to take child bereavement leave, unless it is unreasonable or impracticable.  An employer may also require that the employee provide reasonable documentation such as a death certificate, published obituary, or written verification of death, burial, or memorial services.

The Act’s Impact on Employers

All covered employers – again those with 50 or more employees – should update their employee handbooks and/or leave policies to address the Act’s requirements and to provide notice to employees of their rights under the Act.  Additionally, employers should be aware that they are prohibited from retaliating or taking any other adverse actions against employees who exercise their rights, or attempt to do so, under the Act.  Aggrieved employees may seek recourse either before the Illinois Department of Labor or in state court for violations of the Act.   

Should you have any questions regarding the Act or should you need assistance updating your policies in order to comply with the Act, please contact Kellie Y. Chen at 312-876-7837, E. Jason Tremblay at 312-876-6676 or your designated Arnstein & Lehr LLP attorney.

USDOL Issues New FLSA and EPPA Posters

E. Jason Tremblay

E. Jason Tremblay

The U.S. Department of Labor (DOL) recently issued slightly revised workplace posters under the Fair Labor Standards Act (FLSA) and the Employee Polygraph Protection Act (EPPA). The new EPPA poster includes updated information regarding civil penalties to employers for violating the Act. The new FLSA poster includes new information regarding worker classification issues, lactation breaks and civil penalties.

All employers governed by these two Acts must immediately post copies of each poster in a conspicuous place in each of their work locations. Luckily, both posters are available online from the DOL website. Therefore, you can simply print off the new copies of the posters and replace your existing two posters. Click to go to the FLSA and EPPA Web pages for a copy of the new posters.

Should you have any questions, please contact E. Jason Tremblay at 312-876-6676 or your Arnstein & Lehr LLP employment and labor attorney.