It’s critically important for every employer to be aware of changes to state and federal regulations and laws, as failure to maintain compliance can result in fines or audits.
On January 1, employers in Illinois will be required to provide paid time off to all employees, at a rate of 40 hours per year. Employees can use this leave for any reason and do not have to disclose the reason for this time off to their employer.
Illinois is following in the footsteps of Nevada and Maine in requiring this paid time off without employees having to provide a reason.
The Illinois Department of Labor has provided guidance on how this new law works to make things more clear and easy to adopt, and now is the best time to start reviewing the law to ensure your company is ready when the change is implemented on January 1, 2024.
For example, if your company already provides paid leave to your employees that matches or exceeds the state law, you do not need to do anything different. Your company is already compliant.
Cook County has its own paid leave law, into which municipalities in the county can decide to opt in or out, but all employers in Cook County must now follow the state law, regardless of their previous selections to the county-level law.
The paid time off, at 40 hours per year, applies to both full- and part-time employees and companies are allowed to frontload the time for their employees, but employers need to understand and consider that the paid time off accrual rate, as described in the law, is one hour for every 40 hours worked, meaning part-time workers might not build up their full 40 hours by the end of the year but are still entitled by the law to receive some paid time off. For example, if an employee works 15 hours each week all year, they will have earned 19.5 hours of paid leave by the end of the year.
This accrual begins on January 1 but the state has implemented a 90-day waiting period, meaning any state-mandated PTO can be used beginning at the end of March, 2024. For employees who change jobs during the year, that same 90-day waiting period applies based on the start date at their new job.
Any leave that has been earned but not used by the end of the year will carry over into the next calendar year, according to the law, unless the company provides all eligible PTO at the beginning of the year. Leave must be paid at the normal rate of compensation the employee typically receives; for those employees who receive tips or commission, they must receive the greater of the full minimum wage of the jurisdiction in which they work or their normal hourly rate.
Employers are responsible for displaying the labor law poster outlining this benefit and must keep records of each employee’s hours worked, paid leave accrued and taken and the balance of PTO remaining and maintain those records for at least three years.
There is also the possibility that Illinois might continue to follow in the path forged by other states, including Minnesota, in offering paid family and medical leave, which would provide employees with longer-term time off for things like having or adopting a child, caring for a sick relative, long-term illness, etc. Illinois has not yet adopted this change but as other states have done so, the law might change again in the future.
While this is a big transition for employers, it is important to get systems in place now to ensure your company is in compliance on January 1 to avoid penalties or intrusive record searches in the future. There are benefits to your company in complying with the law, as allowing employees the ability to take time off means they can fight off burnout and protect their health without worrying about losing their jobs or bringing illness into the company.
Still have questions? Davis Staffing can help! Our recruiters also can help you find new job candidates that can help keep your company in compliance, or just add to your team to set your company up for success in the new year. Give Davis Staffing a call today to see how we can help you make 2024 a strong, successful year ahead.
