It is a busy time for employment-related legal updates in Illinois, with Governor J.B. Pritzker recently approving various laws that expand employee protections and add new obligations for employers.
This Client Alert is part of a seven-part series discussing laws Illinois employers need to consider as we move toward 2025. Those laws include:
- amendments to the Illinois Day and Temporary Labor Services Act, which modify and build on 2023 amendments regarding equal pay and benefits for temporary workers (effective 8/9/24) (Client Alert here);
- amendments to the Illinois Human Rights Act expanding the statute of limitations to 2 years and adding new protected classes (effective 1/1/25) (Client Alert here);
- amendments to the Illinois Human Rights Act, which prohibit the discriminatory use of artificial intelligence and require employer notice of AI use in the workplace (effective 1/1/26) (Client Alert here);
- amendments to the Illinois Equal Pay Act governing pay transparency in job postings (effective 1/1/25) (the following alert);
- amendments to the Illinois Wage Payment and Collection Act, which expand pay stub requirements (effective 1/1/25);
- expanded scope of documents and protections under the Illinois Personnel Records Review Act (effective 1/1/25);
- a new Illinois Worker Freedom of Speech Act, which protects employees who decline to participate in certain employer-sponsored meetings on religious or political matters (effective 1/1/25) (Client Alert here);
- amendments to the Illinois Biometric Information Privacy Act, which limit damages for BIPA violations, among other things (effective 8/2/24) (Client Alert here); and
- amendments to the Illinois Right to Privacy in the Workplace Act, which regulate employer use of E-Verify and similar systems (effective 1/1/25).
Stay tuned as other alerts are released in the coming weeks regarding the above updates.
Illinois Equal Pay Act Amendments Requiring Pay Scale and Benefits Disclosures in Job Postings
Effective January 1, 2025, Illinois will join an increasing number of states that require employers to list pay ranges in job postings. The amendment (Public Act 103-0539) to the Illinois Equal Pay Act (the “Act”) requires all employers with 15 or more employees to include pay scale and benefits information in all open job postings for positions that will be physically performed at least partly in Illinois and positions where the employee will report to a supervisor, office, or worksite in Illinois. This means the new requirements will apply to positions where employees will be working remotely from Illinois, as well as positions where remote employees report to a supervisor or location in Illinois.
Key highlights to the amendment include:
Required Pay Scale, Benefits, and Other Compensation Disclosures
“Pay scale and benefits” is defined as the wage or salary, or the wage or salary range, and a general description of the benefits and other compensation. This includes, but is not limited to, bonuses, stock options, or other incentives the employer “reasonably expects in good faith” to offer for the position. The amendment provides that employers should set the position’s reasonably expected pay scale and other compensation by reference to “any applicable pay scale, the previously determined range for the position, the actual range of others currently holding equivalent positions, or the budgeted amount for the position, as applicable.”
To satisfy the pay scale and benefits disclosure requirement, employers may include the pay scale and benefits information directly in a job posting or post a hyperlink to a publicly viewable webpage that includes the relevant pay scale and benefits information. Employers also may satisfy the benefits disclosure requirement by referring in the job posting to a relevant and up-to-date general benefits description in an easily accessible, central, and public location on the employer’s website.
Significantly, the amended Act does not require employers to post job openings. However, if an employer or employment agency does not post pay scale and benefits information, it must provide applicants with the pay scale and benefits information at the applicant’s request and prior to making a job offer or discussing compensation for the position. The amendments confirm that employers and employment agencies are not prohibited from asking applicants about their wage or salary expectations for a position.
Third Party Postings
Employers using one or more third parties to publish job postings must provide the third party with the pay scale and benefits information (or hyperlink) to include in the job posting. Notably, the amended Act allows for liability against third parties for failing to include the pay scale and benefits information in the job posting unless the third party can show that the employer failed to provide the necessary pay scale and benefits information.
Promotion Postings
An employer must announce, post, or otherwise make known all opportunities for promotion to all current employees within 14 calendar days after the employer makes an external job posting for positions, except for designated positions that are exempt from competitive selection.
Record Keeping and Nondiscrimination Protections
Employers must make and maintain records regarding each job position’s pay scale and benefit information and any related job posting for at least five (5) years. Furthermore, employers and employment agencies cannot discriminate or retaliate against applicants or employees for exercising any rights under the law.
Illinois Department of Labor Complaints and Investigations
The Amended Act provides that the Illinois Department of Labor (IDOL) may investigate a complaint from any person who claims to be aggrieved by an employer’s or other third party’s failure to comply with these new job posting requirements. A complaint must be filed with the IDOL within one year of the alleged violation.
If the IDOL determines that an employer has failed to comply with the Act’s new pay transparency requirements, it can issue a notice of violation and impose fines ranging from $250 to $10,000, depending on the number of prior employer violations, whether the job posting is active at the time the IDOL issues its notice of violation, whether the position has been filled, and other factors. For job postings that are still open, cure periods are available to first- and second-time offenders. There are no similar cure periods provided if the job posting is no longer active at the time the IDOL issues its notice of violation. A job posting found to violate the Act shall count as one job posting, regardless of the number of duplicative postings.
Takeaways
We recommend that employers and employment agencies begin reviewing their existing job postings and consult their employment counsel to ensure compliance with these new pay transparency requirements before the end of the year.
Please feel free to reach out to your MBF attorney to discuss further.