What Employers Should Know About the Illinois & Chicago New Paid Leave Rules

On November 3, 2023, the Illinois Department of Labor released proposed regulations for implementing the Paid Leave for All Workers Act (PLAWA).

This law mandates that private employers throughout the state provide their employees with earned paid leave, applicable for any purpose. While some Illinois municipalities already had similar requirements, this Act ensures uniform benefits statewide.

Broadly, the PLAWA covers most employers with employees who work in Illinois, and under this Act, employees are entitled to one hour of paid time off for every 40 hours they work in 12 months. Employers are not required to grant more than 40 hours of paid leave in that period, but employees can also take that leave for any reason.

Although the proposed rules are not yet finalized, they provide additional guidance for employers to consider when aligning their leave policies with the impending PLAWA, which will be effective on January 1, 2024.

Meanwhile, on November 9, 2023, Chicago passed an ordinance providing a comprehensive package encompassing paid leave to all employees who work at least two hours in two weeks while physically present within the City of Chicago.

As per the ordinance, employees can accumulate up to 40 hours of paid leave within 12 months. Additionally, employees can now use an additional 40 hours of paid leave for any reason, making the total allowable paid time off 80 hours per 12-month period. The Chicago ordinance is one of the nation’s most generous paid time off regulations.

The implementation of the Chicago ordinance is scheduled for December 31, 2023, requiring businesses in the city to modify their policies to align with this broader framework quickly.

Moreover, businesses with employees in Illinois, including those within and outside the City of Chicago, should take measures to ensure compliance with the provisions of the Illinois Paid Leave for All Workers Act, which is also to take effect at the beginning of the new year.