Allison Clark, Katten Muchin Rosenman LLP, Chicago
Illinois Paid Leave for All Workers Act Signed into Law
On March 13, 2023, Illinois Governor JB Pritzker signed the Paid Leave for All Workers (PLFAW) Act, S.B. 208, 102d Gen.Assem. (2022), into law, codified at 820 ILCS 192/1, et seq. The PLFAW Act requires Illinois employers to provide at least 40 hours of paid leave each year to all employees. 820 ILCS 192/15. Illinois is the third state in the country to mandate paid time off that can be used for any reason. The Act goes into effect on January 1, 2024.
The PLFAW Act
The PLFAW Act entitles employees to up to 40 hours of paid leave in a year after 90 days of employment. 820 ILCS 192/15(g). The leave can be used “for any reason,” which means the employee does not need to provide an explanation to his or her employer or documentation showing how he or she used the leave. 820 ILCS 192/15(e). Employees who take leave under the Act must be paid their standard hourly wage. 820 ILCS 192/15(f).
The Act covers all employers, including private employers and local and state government offices and agencies. Employers may set parameters like requiring a certain number of days’ notice or setting a “reasonable minimum increment” on the use of paid leave. 820 ILCS 192/15(b). The required days’ notice cannot exceed seven days if the leave is foreseeable (820 ILCS 192/15(h)(1)), and the minimum increment cannot be more than two hours (820 ILCS 192/15(b)). Employers who already have paid leave policies are not impacted as long as their policy guarantees at least 40 hours and that employees can use their time off for any reason.
Maine and Nevada are the only other states with similar mandatory paid leave laws, and Illinois is the most populous state to enact such a law. In signing the legislation, Governor Pritzker stated, “Employers benefit from allowing employees to tend to the urgent personal matters of their lives. Workers’ productivity increases, and they often gain greater passion for their job when they can manage the stresses they face outside work.” Press Release, State of Illinois, Gov. Pritzker Signs Historic Legislation Guaranteeing 40 Hours of Paid Leave (Mar. 13, 2023). The Act was also backed by organizations like the Shriver Center on Poverty Law, which hailed the law as “an important step in ensuring that all workers in Illinois, regardless of how much they earn, the industry they work in, or where in the state they live, will have access to at least a minimum amount of paid leave.” Shriver Center on Poverty Law, Illinois Workers Celebrate Passage of Paid Leave Legislation (Jan. 11, 2023).
Exemptions
Some employees are exempt from the Act’s requirements, and their employers are not required to provide them with the standard 40 hours of paid leave. These employees include
employees as defined by the federal Railroad Unemployment Insurance Act, ch. 680, 52 Stat. 1094 (1938), or the Railway Labor Act, ch. 347, 44 Stat. 577 (1926) (820 ILCS 192/10);
short-term employees who work in higher education (id.);
students who are temporarily employed by a college or university (id.);
construction employees who are already covered under a collective-bargaining agreement (id.); and
parcel and pickup industry employees who are already covered under a collective-bargaining agreement (820 ILCS 192/15(n)).
Municipalities that already have paid sick leave ordinances, like Cook County and Chicago, are also exempt from the Act.
Enforcement
Employers that do not adhere to the Act’s requirements, or those that retaliate against employees who exercise their rights under the Act, are subject to enforcement actions and penalties. Employees may file a report with the Illinois Department of Labor (IDOL), which is responsible for administering and enforcing the Act, within three years of an alleged PLFAW Act violation. The report will then be investigated by IDOL. After conducting its investigation, IDOL will schedule a formal hearing with an administrative law judge if it has reason to believe there has been a violation.
Employers that fail to post notice of the Act in a conspicuous place in the workplace can be fined $500 for the first infraction and $1,000 for every violation afterwards. 820 ILCS 192/20(d). Employers that do not provide the minimum paid leave, retaliate against an employee for exercising his or her rights, or otherwise violate the Act may be liable to the aggrieved employee for damages. Available damages include actual damages from underpayment, a fine of $500 to $1,000, and compensatory damages. 820 ILCS 192/30(b). The Act also includes a provision that requires employers to pay a $2,500 civil penalty for every individual violation, which will be deposited into a PLFAW Act fund. 820 ILCS 192/35.
Conclusion
The PLFAW Act makes substantial changes to employers’ obligations under Illinois law. Employers may be subject to enforcement actions, penalties, and damages if they do not adhere to the Act. Therefore, it is important that all employers review their leave policies and make adjustments as needed.
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