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As with our merger, two highly informative blogs geared towards employers have been combined – WISE: Workplace Initiatives by Saul Ewing and The General Counselor, are now WISE: Workplace Initiatives and Strategies for Employers. Our combined blog will keep you WISE with labor and employment law updates and up-to-date on various issues. Please check out our blog here and subscribe to our email list to stay informed.

Mandatory Employee Handbook Policies – Part II

EMPLOYMENT LAW ESSENTIALS

E. Jason Tremblay

E. Jason Tremblay

In light of the huge increase in wage and hour litigation under the Fair Labor Standards Act (FLSA) and related state law, employers must clearly outline policies addressing wage and hour issues, such as timekeeping, overtime, lawful deductions for exempt employees and “safe harbor” rules. Building on my last article on mandatory handbook policies, this article highlights the mandatory policies addressing various wage and hour issues that, if properly drafted and followed, can reduce the threat of litigation and/or provide defenses to a company if it is involved in wage and hour litigation.

Timekeeping Policy

Initially, the FLSA mandates that “non-exempt” employees be compensated at a rate of time and a half for all hours worked over 40 hours in a workweek. As a result, and because it is the employer’s burden to prove when an employee worked, it is important that every company have a clear way to track when employees come and go and otherwise perform compensable work. Without an accurate timekeeping system, including a timekeeping policy of how and when employees are supposed to record their time, employers are exposed to claims for unpaid compensation or overtime by current and past employees. Keep in mind that some states, like Illinois, require companies to track all employees’ time, both exempt and non-exempt employees, in some fashion, and a company’s failure to maintain such records not only exposes it to wage and hour liability, but it can also be subject to fines and penalties from the Illinois Department of Labor.

Lunch Break Policy

Lunch breaks and, specifically, a company’s failure to pay non-exempt employees who are obligated to work through their lunch breaks are increasingly becoming a liability for employers. As a matter of background, there are many states, like Illinois, that require employers to provide employees with an unpaid lunch break after working a certain number of hours. While those lunch breaks are unpaid, problems arise when the employee is not completely relieved of his or her duties. In fact, to the extent the employee is required to answer calls or respond to emails during a lunch break, such time must be compensated and also counts towards that employee’s overtime hours (if the total is in excess of 40 hours in a particular workweek). As a result, all employers should have a lunch break policy clearly outlining when to clock in and about for lunch, as well as procedures to notify management in the event employees are required to work during a lunch break.

Employee Time Sheet - OvertimeOvertime Policy

Overtime can also be a thorny issue for employers. Depending on the industry, as well as other factors, an overtime policy may be needed. An overtime policy should clearly articulate when, and under what circumstances, overtime is allowed. For example, it is prudent to maintain a policy that provides that overtime is not allowed unless authorized in writing by a manager. This way, the company can easily and more efficiently track the use of overtime, as well as have a record of overtime so that improper FLSA overtime lawsuits can be defeated. However, do not forget that unauthorized overtime must still be compensated.

Lawful Deductions Policy

Under the FLSA and related state law, some employees are “exempt” from the payment of overtime. Many employers do not realize, however, that they can inadvertently eliminate the “exempt” status of an otherwise exempt employee, thereby entitling the employee (and potentially all others in that job category) to overtime. This is usually done when an employer improperly takes certain deductions from the “exempt” employee’s salary. For example, an employer is not allowed to take deductions from an “exempt” employee’s salary for certain absences from work for things such as lateness, some violations of company policy or damage to company equipment. Thus, a policy prohibiting improper deductions, identifying under what circumstances deductions can be made, and what an employee can do if an improper deduction is made, should be drafted in the employee handbook.

FLSA “Safe Harbor” Language

The U.S. Department of Labor has provided employers with a defense if improper deductions are erroneously made by the employer. Specifically, the employee will not lose his or her exempt status if the employer has a clearly communicated policy that prohibits improper deductions and sets forth a clear complaint procedure available to employees. This policy should also provide that the employer should promptly reimburse the employee for any improper deductions and should make a good faith commitment to comply with the FLSA in the future. Finally, anti-retaliation language should be inserted into this policy highlighting the company’s commitment not to retaliate against employees who bring good faith complaints to management about improper deductions (or any other alleged wage and hour violations for that matter).

Tune into my next Employment Law Essentials article detailing some necessary workplace safety and asset protection policies to maintain in an employee handbook.

*This is the fifth article in the “Employment Law Essentials” series. The information contained in the articles, provided by Arnstein & Lehr LLP partner E. Jason Tremblay, is  for educational purposes only. It should not be construed as legal advice. If you have any questions about the article or other employment law issues, please contact Mr. Tremblay at (312) 876-6676.

Mandatory Employee Handbook Policies – Part I

EMPLOYMENT LAW ESSENTIALS

E. Jason Tremblay

E. Jason Tremblay

Following up on my last article regarding whether a company should maintain an employee handbook, the next important question to answer is what provisions are essential to maintain in a handbook. There are literally hundreds of policies that an employer can insert into a handbook, but this article (as well as the next few) is dedicated to highlighting the most important policies to maintain in a handbook. The policies referenced in this article are generally introductory handbook policies. Keep in mind that employee handbooks should be written in “plain English” that are easy to understand and follow by both management and employees.

“At-Will” Employment Statement

To alleviate the problem of converting an employee handbook into a binding employment contract between a company and its employees, a carefully drafted “at-will” statement must be contained in the handbook. An “at-will” statement specifically provides that the handbook is not a contract of employment, is not intended to create any binding contractual commitments between the employer or any of its employees, and that the employment relationship is “at-will” (i.e., the employer and its employees retain the mutual right to terminate the employment relationship with or without notice, cause or reason). An “at-will” employment policy should be one of the first policies contained in a handbook.

Equal Employment Opportunity Policy

An employer must ensure that it has an Equal Employment Opportunity (EEO) statement that provides that it has a policy of providing equal employment opportunities to all individuals regardless of their protected classification (e.g., sex, age, religion, disability, genetic predisposition, sexual orientation and other characteristics protected by the law). The EEO policy should cover all protected classifications of employees, including additional classes that may be protected by state law or local ordinances. This policy should also be inserted into the earlier section of any employee handbook.

Harassment and Retaliation Policy

A prudent employer must also adopt an anti-harassment policy that prohibits sexual and all other unlawful types of harassment and discrimination (such as racial, national origin, pregnancy, etc.). The anti-harassment policy should set forth:

  1. definitions of sexual harassment and other types of unlawful harassment, using examples;
  2. the illegality of any harassment;
  3. the internal complaint procedures available to employees to complain of the harassment, keeping in mind that there should be alternative avenues (or bypass procedures) through which an employee can complain in case, for example, the alleged harasser is the individual to whom the employee is supposed to complain;
  4. a statement explaining that a prompt investigation of the complaint will take place and that the appropriate remedial action will be taken to stop the unlawful harassment; and
  5. assurances that employees who report harassment will not be retaliated against for making a complaint or reporting the harassment.

Reasonable Accommodation Policy

Employers of all sizes must accommodate known or perceived disabilities (as the term is defined broadly under federal, state and/or local law). An employer must therefore maintain a “reasonable accommodation” policy complying with the Americans with Disabilities Act and other federal, state or local laws dealing with disabled employees and applicants. The policy should also include the employer’s commitment to reasonably accommodate religious beliefs of its employees. In Illinois, this policy should also reflect the employer’s commitment to reasonably accommodating pregnancy-related conditions. In most circumstances, providing an employee with a reasonable accommodation will be a minimal cost to the employer and will avoid a costly and protracted legal battle if the employee sues for the requested accommodation. This policy should set forth:

  1. the concept of a reasonable accommodation;
  2. the procedures to be followed when an employee needs an accommodation; and
  3. a commitment to provide reasonable accommodations that do not cause undue hardship to the employer.

Immigration Policy

The Immigration Reform and Control Act of 1986 (IRCA) prohibits employment discrimination on the basis of national origin or citizenship, or requiring more or different identification documents for particular individuals. The IRCA also provides for the imposition of civil monetary fines and criminal penalties on employers who violate the IRCA’s provisions regarding the restriction on employing aliens who are not legally authorized to work in the United States. Because the IRCA’s employer sanction provisions have potentially severe consequences for employers who violate them, it is essential that all companies that hire employees be aware of the IRCA’s provisions and that they follow the IRCA regulations. As such, a “must have” policy is an immigration policy highlighting the employer’s commitment to comply with the IRCA and prohibiting discrimination based on an employee’s national origin or citizenship.

Tune into my next Employment Law Essential article detailing the necessary wage and hour related policies to maintain in an employee handbook.

*This is the fourth article in the “Employment Law Essentials” series. The information contained in the articles, provided by Arnstein & Lehr LLP partner E. Jason Tremblay, is  for educational purposes only. It should not be construed as legal advice. If you have any questions about the article or other employment law issues, please contact Mr. Tremblay at (312) 876-6676.

Employee Handbooks – Should You Maintain One?

EMPLOYMENT LAW ESSENTIALS

E. Jason Tremblay

E. Jason Tremblay

A threshold issue facing many companies is whether to publish an employee handbook. The purpose of an employee handbook is to provide a company’s employees with the company’s policies and inform them of the rules that govern them throughout the stages of employment. Through an employee handbook, employers notify employees about the legal rights and obligations they both have in the employment relationship. While an employee must comply with the policies contained in an employee handbook, a handbook should not be drafted in a way so as to create an employment contract with the employee. In other words, the employee handbook, while specifically describing the rights and duties of the employee, should be drafted in a way so as to maintain the “at will” relationship between the employer and the employee.

Advantages of an Employee Handbook

There are a number of advantages to having an employee handbook.

  • A handbook advises the employee and the employer in writing of their respective duties and obligations. The handbook therefore clarifies expectations and helps promote the fair and consistent administration of policies.
  • A carefully written handbook can improve morale, prevent costly disagreements and, most importantly, keep the employer out of court, as long as it consistently follows the provisions of the handbook.
  • An updated handbook is useful for demonstrating a company’s commitment to complying with federal, state and local laws.
  • A handbook can showcase the benefits a company has to offer to employees and prospective employees, as well as can let employees know where they can turn to for various issues.
  • A personalized employee handbook also promotes consistency in management and is an efficient recruitment tool for new employees. A “make it up as you go along” policy of addressing human resource and personnel issues, as well as a “one size fits all” handbook, are one-way tickets to getting sued and incurring liability.

Disadvantages of an Employee Handbook

While employee handbooks are generally recommended, they also have some disadvantages.

  • The primary disadvantage stems from the fact that employee handbooks can create certain obligations on the company if they are not drafted correctly. For example, discipline policies that mandate an elaborate series of warnings and write-ups may sound good in theory, but they may otherwise restrict an employer from dealing appropriately with a problem employee.
  • A company that sets out a policy and then fails to follow it (or applies it inconsistently) is inviting an employee to challenge the company’s employment decisions. It can even be evidence of pretext in an unlawful termination claim.
  • If not regularly reviewed, handbook provisions can become outdated and unenforceable.
  • If handbooks are not drafted properly, they can become an enforceable contract between the employee and the company. These disadvantages can easily be eliminated if the handbook is carefully drafted and reviewed by an employment attorney.

In the end, employee handbooks are generally advisable to maintain, but care must be taken to ensure that the policies are clear, well-written, reviewed, updated regularly and, most importantly, consistently followed and applied.

*This is the third article in the “Employment Law Essentials” series. The information contained in the articles, provided by Arnstein & Lehr LLP partner E. Jason Tremblay, is  for educational purposes only. It should not be construed as legal advice. If you have any questions about the article or other employment law issues, please contact Mr. Tremblay at (312) 876-6676.

Properly Maintaining Personnel Files

EMPLOYMENT LAW ESSENTIALS

E. Jason Tremblay

E. Jason Tremblay

Properly Maintaining Personnel Files

Since virtually all employment disputes relate in some way to what documents are kept in an employee’s personnel file, it is crucial that employers properly maintain employee personnel files. Of course, few employers enjoy dealing with paperwork, but taking the time to properly create and maintain personnel files will pay off in the long run.

Properly maintained personnel files allow the company to have all important documents relating to each employee in one central location that is easily accessible when it is time to make a personnel decision or to comply with government audits. Moreover, if you have to terminate a problem employee, maintaining the appropriate documentation in the personnel file will protect you from any frivolous claims brought by a terminated employee. This weekly update serves to identify what should and should not be kept in a personnel file, as well as how to properly maintain a personnel file in today’s litigious environment.

Documents to Keep in a Personnel File

A personnel file should be opened for each employee on their date of hire. Under Illinois and federal law, all job-related documents should go into the file, including:

Employment Agreement

  • Job description for the position
  • Job application and/or resume
  • Written offers of employment
  • The employee’s IRS form w-4
  • Receipts or signed acknowledgements (FMLA policy, sexual harassment policy, computer use policy etc.) of company documents, policies, or training
  • Performance evaluations
  • Forms relating to employee benefits (or waiver of employee benefits)
  • Forms providing next of kin and emergency contact information
  • Awards or citations for good performance
  • Warnings and/or other disciplinary action notices taken due to the employee’s poor performance
  • Notes and memos on the employee’s attendance or tardiness
  • Contracts or written agreements between the company and the employee, if applicable (employment agreement, non-disclosure agreement, etc.)
  • Complaints from customers and/or coworkers of the employee
  • Documents related to the worker’s termination or departure from the company (such as exit interview information or documentation related to the employee’s termination)

In short, all documents that relate to the employee’s qualifications for employment, demotion, transfer, additional compensation, discharge or other disciplinary actions should be included and maintained in an employee’s personnel file.

Documents That Should Not Be Kept in a Personnel File

A company’s personnel files should not be a receptacle for every single document, note, or thought about an employee. Some documents should be segregated from a personnel file. For example:

  1. All Employee Eligibility Verification Form I-9s and other immigration forms should be segregated from an employee file. Since the government is entitled to inspect these forms with very little notice, a company should segregate all employee Form I-9s into a separate file so that, if audited, it will make it much easier for the company to promptly provide the government with those forms.
  2. Medical records of an employee should also not be placed into a personnel file. In many states, workers have certain rights to privacy to their medical information. Therefore, keep all medical records, including records related to workers’ compensation claims or an underlying injury, in a separate file apart from the personnel file.
  3. Since the contents of a personnel file may turn into evidence in a lawsuit brought by a disgruntled former employee, it is important not to maintain attorney work product or attorney-client communications in a personnel file. A good rule of thumb in this regard is not to put anything in the personnel file that you would not want a jury to see.

Procedures to Help Maintain a Personnel File Over Time

Electronic Personnel FilesReviewing personnel files periodically is useful to ensure that important documents are up to date. Therefore, at least once a year, companies should check their personnel files to confirm that they include the documentation referenced above.

Additionally, it is not unheard of that crucial documents in a personnel file “disappear” without a trace. As such, as with any other important documentation, personnel files should be located in a secure location, under “lock and key,” and only available to those employees who are authorized to have access to the files. As well, maintaining personnel files electronically is a way to ensure that personnel files do not “disappear” (at least physically).

How Long to Maintain Personnel Files

Under new federal and state e-discovery rules, draconian penalties can result if a company permits the destruction or deletion of relevant documents — such as those documents contained in a personnel file — after a company has notice of a potential claim. To avoid such a possibility, it is generally advisable to keep a personnel file for a minimum of three (3) years following the relevant employee’s termination and/or separation from the company. If the company reasonably anticipates litigation, either by receipt of a formal charge or by a verbal threat by an employee, all potentially relevant documentation relating to their employment should be preserved, even if the company maintains a document destruction policy.

As well, keep in mind that many states, such as Illinois, allow employees (both current and terminated) to access their personnel file. For this reason also, it is important for companies to properly maintain and preserve their employee files.

 

*This is the second article in the “Employment Law Essentials” series. The information contained in the articles, provided by Arnstein & Lehr LLP partner E. Jason Tremblay, is  for educational purposes only. It should not be construed as legal advice. If you have any questions about the article or other employment law issues, please contact Mr. Tremblay at (312) 876-6676.

 

Employer and Labor Law Posting Requirements

EMPLOYMENT LAW ESSENTIALS

E. Jason Tremblay

E. Jason Tremblay

Employer and Labor Law Posting Requirements

Employment and labor laws require employers to post state, federal and locally mandated posters where visible to employees that inform them of their employment and labor law rights. An employer’s failure to post such mandated posters can subject it to fines and penalties, as well as lawsuits. There have also been cases that have held that an employer’s failure to post a required labor law poster tolls the applicable statute of limitations for certain employment discrimination causes of action. Accordingly, an employer should routinely ensure that it is posting the required notices and that those notices are current and updated with the most recent version of the notice.

Illinois Posting Requirements
IDOL Minimum Wage Poster ImageThe following notices are mandated by Illinois law to be posted in the workplace:

  • Notice to Workers About Unemployment Insurance Benefits
  • Notice to Workers About Workers’ Compensation
  • Equal Pay is the Law
  • Illinois Dept. of Labor Notice to Employers and Employees (Minimum Wage)
  • Pay Day Notice
  • Pregnancy Rights Poster
  • Illinois Dept. of Labor Notice to Employers and Employees (Victims Economic Security and Safety Act)
  • Illinois Dept. of Public Health Emergency Care for Choking Notice (mandatory for dining facilities and recommended for places of employment where employees eat on premises)
  • Illinois Employee Classification Act Notice (mandatory for construction contractors for whom one or more individuals perform services who are not classified as employees)
  • Illinois No Smoking Notice
  • Illinois Firearms Concealed Carry Notice (mandatory if employer wants to prohibit concealed weapons in workplace)
  • Day and Temporary Labor Services Act Notice (required for All Day and Temporary Labor Service Agencies in Illinois)

Federal Posting Requirements
USDOL FMLA Poster ImageThe following notices are mandated by federal law to be posted in the workplace:

  • Uniformed Services Employment and Reemployment Rights Act (USERRA)
  • Equal Employment Opportunity is the Law (a version later than Nov. 2009 which includes the Genetic Information Nondiscrimination Act notice)
  • It’s the Law OSHA Notice
  • Family and Medical Leave Rights Act Notice (only required for employers of 50 or more employees)
  • Notice to Workers with Disabilities (only required for employers who employ workers with disabilities)
  • Fair Labor Standards Act (including minimum wage)
  • Employee Polygraph Protection Act
  • Notice of Employee Rights Under the NLRA (for federal contractors and subcontractors)

Federal law also requires that the federally-mandated notices be displayed for job applicants, as well as employees. Accordingly, an employer must usually have two sets of postings at locations where applicants and employees are located in different areas. And, where a company has a large number of employees who speak Spanish (or some other language), it is advisable to have two sets of posters – one in English and one in Spanish (or the other language).

Please note that certain public entities, industries and/or companies may be required to have additional posters. For example, government contractors are obligated to have additional posters. Therefore, it is advisable to contact an employment attorney to ensure that you are posting the correct and most up-to-date employment and labor law posters.

Don’t Forget Local Posting Requirements
Along with the other required posters noted above, employers located both in the City of Chicago and Cook County may also be obligated to post certain notices. For example, employers located within the City of Chicago must post the City of Chicago Minimum Wage Ordinance Notice (which includes the new mandatory sick leave available for employees). Similarly, Cook County employers are required to post the Cook County “Earned Sick Leave” Ordinance poster to the extent they are covered under the Ordinance.

Where to Display Required Notices and Posters
As a general matter, employment and labor law notices must be displayed in a location conspicuous to all employees at each of the employer’s work facilities. There are no specific requirements that the notices be posted in particular locations, but generally they should be placed in employee common areas, such as lunch or break rooms, where they can readily be seen by employees. Additionally, although not mandated by law, it would be prudent for companies to post these notices on their websites as well.

How to Obtain Required Notices and Posters
Most employment and labor law notices can be obtained from the responsible federal, state or local agency, downloaded from their respective websites or, alternatively, from larger commercial office supply retailers. To assist you, the following are links to several of the government websites.

Illinois Department of Labor
Illinois Department of Labor – Posters and Notices
Illinois Department of Human Rights
Illinois Department of Employment Security
Illinois Workers’ Compensation Commission
U.S. Department of Labor
U.S. Department of Labor – Posters and Notices
Cook County Commission on Human Rights

 

*This is the first article in the “Employment Law Essentials” series. The information contained in the articles, provided by Arnstein & Lehr LLP partner E. Jason Tremblay, is  for educational purposes only. It should not be construed as legal advice. If you have any questions about the article or other employment law issues, please contact Mr. Tremblay at (312) 876-6676.

 

New Illinois Sick Leave Laws Compliance Seminar

“Back to Basics” Employment Law Series

Properly Complying with New Illinois Sick Leave Laws

Three recently enacted laws expanding sick leave benefits within the state of Illinois will soon impact employers with operations in Illinois. This presentation will discuss the new sick leave laws and provide helpful strategies to comply with the new laws.

When: Tuesday, June 27, 2017 ~ 7:30-9:30 a.m.
7:30-8:00 Networking/Breakfast
8:00-9:00 – Presentation
9:00-9:30 – Q&A/Further Networking

Where: O’Hare Lake Office Park
2200 East Devon
Conference Room, Suite 244
Des Plaines, Illinois 60018

Cost: Complimentary

RSVP: To RSVP for the event, please click here. Space is limited.

CLE credits available.

Speaker: E. Jason Tremblay

Jason Tremblay
Partner
Arnstein & Lehr LLP
161 North Clark, Suite 4200
Chicago, Illinois 60601

Cook County Sick Leave Poster and Draft Regulations Are Available

E. Jason Tremblay

In anticipation of the upcoming effective date (July 1, 2017) of the Cook County “Earned Sick Leave” Ordinance, the Cook Commission on Human Rights recently published the mandatory poster required to be posted by all employers covered by the Ordinance. A copy of the poster is available for download by clicking here.

The Commission also recently published draft regulations for the Ordinance that provide, at least in some cases, clarity to and interpretation of the Ordinance’s provisions. The draft regulations also are available for download by clicking here. Such draft regulations are anticipated to be adopted by June 1, 2017, well in advance of the effective date of the Ordinance. Some of the more significant highlights of the draft regulations are contained below:

  • While the Ordinance provides the accrual period begins on July 1, 2017 or an employee’s first date of employment, whichever is later, the draft regulations also state that an employer may define their own accrual period that is consistent with its own benefit year. Therefore, provided an employer accrues and tracks benefits, such as PTO, on a calendar year basis, it can likewise track paid sick leave on that same calendar year basis.
  • The draft regulations also make clear that, while many municipalities have opted out of the Ordinance (and the list of those municipalities is growing), employers still may be covered, and obligated to provide sick leave, in the event the company’s employees perform compensated work at a location in Cook County that has not opted out. In other words, an employee who may be authorized to work from home, and who lives in a municipality within Cook County that has not opted out, will be entitled to earn sick leave despite the company being located in a municipality that has opted out of the Ordinance.
  • The draft regulations also clarify that employers may “front load” paid sick leave as an alternative to the accrual method. Many smaller companies may have difficulty tracking the amount of sick leave a particular employee may earn. Accordingly, the regulations clarify the permissibility of allowing covered employers to “front load” paid sick leave if the employer provides covered employees the maximum amount of earned sick leave the employee could accrue during the relevant accrual period.
  • In addition to conspicuously posting the required poster at each business facility where any covered employee works within Cook County, the regulations clarify that all covered employees must also be provided a notice of rights by the employee’s date of coverage or eligibility. This could be provided and inserted into the employee’s first paycheck. Alternatively, such notice of rights could be provided to the employee during any orientation period.

What should employers do to prepare?

This Ordinance is significant for a large portion of Cook County employers. While there is still time to prepare for the effective date of this Ordinance, Cook County employers should consider and implement some of the following actions:

  • Evaluate whether an existing paid time off (PTO) policy will satisfy the requirements of the Ordinance.
  • Determine whether to use an accrual or lump-sum method of providing paid sick leave.
  • Review and revise, if necessary, existing paid sick leave time and/or paid time off policies and procedures to meet the Ordinance’s requirements.
  • Audit time-keeping, payroll and benefit systems to insure proper tracking of paid sick leave usage, accrual, caps, and carry over limits.
  • Ensure that the proper written notices will be provided, including the applicable poster at each worksite located within Cook County, as well as the separate employee notice provided to each employee in their first paycheck following the effective date of the Ordinance, or upon hiring, whichever is later.

For a more detailed summary of the Ordinance’s provisions, please see my colleague’s earlier post on the Ordinance here.

As always, should you have any questions, please contact E. Jason Tremblay at (312) 876-6676 or your Arnstein & Lehr LLP employment attorney.

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.

Please click here for a downloadable PDF of this post.

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.