26 Aug

August 2021 Illinois HR Legal Updates

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Illinois Enacts Pay Data Collection Law

Update Applicable to:
All employers in Illinois.

What happened?
On March 23, 2021, Governor Pritzker signed SB 1480 into law which amends the Illinois Equal Pay Act of 2003.

What are the details?
The Law will require employers with more than 100 employees in the state to begin reporting pay data starting January 1, 2023, while also acquiring an equal pay registration certificate by March 24, 2024.

Employers covered under the amendment must pay a $150 filing fee and submit the following information with their application for certification to the Department of Labor:

  • Equal pay compliance statement signed by a corporate officer, legal counsel, or authorized agent of the company.
  • Confirmation that the business does not restrict certain roles to genders and makes employment decisions without regarding gender.
  • Explanation of how the business reviews wages and benefits to identify disparities and how the business corrects such disparities.
  • Explanation of the system the business uses to determine compensation for employees.
  • Most recent federal EEO-1 report (if applicable).
  • List of employees separated by gender and race/ethnicity categories and the total wages paid to each employee.

Another component that employers in Illinois will be required to obtain is a certification by signing a compliance statement that confirms the following:

  • The business’ compliance with Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, the Illinois Human Rights Act, the Equal Wage Act, and the Equal Pay Act of 2003.
  • The average compensation for female and minority employees is not consistently below the average compensation (as determined by the U.S. Department of Labor) for male and non-minority employees within each EEO-1 major job category. Employers must consider length of service, requirements of specific jobs, experience, skill, effort, responsibility, working conditions of the job, or other mitigating factors.
  • The business does not restrict employees of one sex to certain job classifications and makes retention and promotion decisions without regard to sex.
  • Wage and benefit disparities are corrected when identified to ensure compliance with the state and federal antidiscrimination laws.
  • How often the business evaluates wages and benefits to ensure compliance with state and federal antidiscrimination laws.
  • Whether the business, in setting compensation and benefits, uses a market pricing approach; state prevailing wage or union contract requirements; a performance pay system; an internal analysis; or an alternative approach and a description of the alternative approach.

The law can be read here.

An article on the law is found here.

What do employers need to do?
Employers should access the law here to review and update their policies on pay and pay data collection to be in compliance with the law when it becomes active.

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Illinois Enacts Bill to Make Work Authorization Status Discrimination a Civil Rights Violation

Update Applicable to:
All employers in Illinois.

What happened?
On August 2, 2021, Governor Pritzker signed House Bill 0121 (HB 0121) into law and adds a provision to the Illinois Human Rights Act (IHRA)

What are the details?
Effective immediately, the bill adds a provision to the IHRA to make discrimination against employees and job applicants based on their work authorization status a civil rights violation. Under the bill work authorization status is defined as the status of being a person born outside of the United States, and not a U.S. citizen, who is authorized by the federal government to work in the United States.

The bill can be read here.

An article on the Bill can be read here.

What do employers need to do?
Employers should review the law to ensure they stay in compliance with the addition to the IHRA.

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Illinois Equal Pay Act Requirements Expanded in Amendment

Update Applicable to:
Employers in Illinois with more than 100 employees.

What happened?
On June 25, 2021, Governor Pritzker signed SB 1847 into law, amending the Illinois Equal Pay Act.

What are the details?
The bill makes amendments to the Illinois Equal Pay Act (IEPA) to add additional requirements to Employers and will be active when the IEPA becomes effective in March 2024. Employers with more than 100 employees will now be required to:

  • Pay a $150 filing fee.
  • Submit a signed statement that the business complies with Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, the Illinois Human Rights Act, the Equal Wage Act, and the Equal Pay Act of 2003 (the “Statutes”).
  • For businesses required to file an EEO-1 with the EEOC, submitting a copy of the business’s most recently filed EEO-1.
  • Compile and submit a list of all employees during the past calendar year (from records maintained and available), separated by gender and race and ethnicity categories reported in the business’s most recently filed EEO-1, as well as report the total wages paid to each employee during the past calendar year, rounded to the nearest hundred dollars.

The amendments also retain clarity on that the compliance statement must contain the following information that certifies:

  • The average compensation for its female and minority employees is not consistently below the average compensation, as determined by the rule by the IL DOL, for its male and non-minority employees within each job category listed in the business’s EEO-1.
  • The business does not restrict employees of one sex to certain job classifications and makes retention and promotion decisions without regard to sex.
  • Wage and benefit disparities are corrected when identified to ensure compliance with the statutes.
  • The business evaluates its wages and benefits for equality and describes how often wages and benefits are evaluated to ensure compliance with the statutes.

The bill can be read here.

An article on the bill can be read here.

What do employers need to do?
Employers should review the amendments made to the new bill in order to stay in compliance and prepare for when the bill becomes active in March 2024. The law firm, Foley & Lardner LLP, suggests that Illinois employers should start tracking and evaluating this data in preparation for reporting in the not-so-distant future. Any pay inequity issues should be addressed and remedied.

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Illinois Expands the Secure Choice Mandatory Retirement Savings Program.

Update Applicable to:
Employers in Illinois with at least five employees.

What happened?
On July 30, 2021, Governor Pritzker passed HB0117 into law, amending the Illinois Secure Choice Savings Program.

What are the details?
The law makes amendments to Illinois Secure Choice Retirement Savings Program, including:

  • The 25-employee threshold is reduced to five employees. Now, the program will apply to employers with at least five employees in the state during every quarter of the previous calendar year. The employer determines the total employee count using the annual average from the employer-reported quarterly data.
  • Secure Choice now includes annual, automatic increases to the contribution rates up to a maximum of 10% of an enrollee’s wages. The Illinois Department of Revenue will establish a schedule for the automatic increase.
  • The changes clarify that the second year of non-compliance need not be consecutive for applying the $500 non-compliance penalty.
  • Employers now have 120 days (rather than 90 days) after issuance of a notice of proposed penalty assessment for non-compliance to file a protest with the department or come into full compliance.
  • The changes allow providing notices electronically rather than only by first class mail.

The current enrollment deadline for the Illinois Secure Choice Savings Program is in two waves depending on the number of employees an employer has: 

  • Wave 1: The enrollment deadline for employers with fewer than 25 employees and more than 15 employees will be no sooner than September 1, 2022
  • Wave 2: The enrollment deadline for employers with at least five employees but not more than 15 employees will be no sooner than September 1, 2023.

The law can be read here.

An article on the law can be read here.

What do employers need to do?
Employers should review the law and the amendments it brings to the Illinois Secure Choice Savings Program and the eligibility of employers to enroll to stay in compliance with the program.

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