Here we go again, it’s time for us to take a look at what the Illinois and Federal government has been up to in 2024 that is going to affect you as an employer. Thankful, there are not quite as many new laws on the books for 2025, but since there was so much focus on the new Paid Leave For All Workers Act and Chicago Sick and Safe Leave Ordinance change in 2024, let’s do a review of some of the other laws that went into effect just this past summer:
2024 Federal Laws:
- Pregnant Workers Fairness Act:
The Equal Employment Opportunity Commission (EEOC) recently issued the new Pregnant Workers Fairness Act (PWFA), which went into effect on June 18, 2024. The PWFA protects qualified employees due to: “Pregnancy, childbirth, or related medical condition.” Because of this, employers are responsible for providing reasonable accommodations to these individuals.
What do businesses need to do?
Illinois amended the Illinois Human Rights Act (Act) in 2015 expanding protections for pregnant workers. The Act requires reasonable accommodations due to pregnancy. Pregnancy is similarly defined as “pregnancy, childbirth, or a medical or common conditions related to pregnancy or childbirth.” So, as an Illinois employer, not a lot might change for your business. With that said, revisit your employee handbook and ensure that it is compliant with both the PWFA and the Act, and look out for a new blog coming your way comparing the current Act versus the PWFA.
- Changes to Freelance Classification
The U.S. Department of Labor (DOL) announced the final rule revised the guidelines determining independent contractor status which went into effect on March 11, 2024. The rule rescinds the 2021 Independent Contractor Status Under the Fair Labor Standards Act rule. Thus, the rules regarding who is an independent contractor will go back to the way they were before 2021. So, the final rule instructs employers to determine whether a worker is an independent contractor through the Six Factors of The Economic Reality Test, which can be found on the DOL website.
What do businesses need to do?
You should take time to examine your current workers and ensure that the reverting of the rules does not change the classification of any of their workers.
- Changes to the Overtime Requirements
The U.S. Department of Labor has issued a final rule which went into effect on July 1, 2024, regarding what workers must be paid overtime. The standards for an employee to be exempt from overtime follow three basic rules: (1) be paid a salary; (2) fall under an exemption category; and (3) make more than the salary threshold. More about these requirements can be found on the DOL website. This rule implements an increase in the salary threshold:
- As of July 1, 2024, the salary threshold increased to $43,888
- As of January 1, 2025, the threshold will continue to increase to $58,656.
- DOL will now update the eligibility threshold every 3 years instead of every 5-9 years.
However, the authority of the DOL to make this salary threshold change has been challenged in various jurisdictions. While the long-term effect is in question, as of right now the rule is in effect.
What do businesses need to do?
Even if this law is blocked, as of right now the salary requirement is in effect. So, review all exempt employees and adjust the classification of your employees if necessary.
- The Non-Compete Ban?
You may have heard a lot about the FTC Banning Non-Competes and may wonder where that is on our list. Well, worry not. The FTC’s ban on non-competes was blocked and it has no effect. To read a more detailed analysis we talk about it more here!
2024 State Laws
- Freelance Worker Protection Act
Speaking of freelance workers, the Illinois Department of Labor also made some changes regarding certain freelance workers through the Freelance Worker Protection Act. The freelance worker affected must be an independent contractor who “provides products or services in Illinois” and only if within 120 days the value of that work is more than $500. This act gives freelance workers certain protection in Illinois. Accordingly, they are entitled to the following:
- A written contract;
- Payment of services as specified in the contract or within 30 days of completion of services; and
- Protection from retaliation
What do businesses need to do?
- Most likely this will not impact your business all that much. But if you do not currently have contracts with your freelancers, now is the time to put those in place. Also, you should review your payment and other terms with your freelancers to ensure they comply with the new law.
2024 Chicago Laws
- Changes to the Fair Workweek Ordinance
The new Paid Leave and Sick and Safe Ordinance isn’t Chicago’s only new law impacting employers. Chicago’s Fair Workweek Ordinance which requires certain employers to provide workers with predictable work schedules has been updated to increase the salary threshold for employees covered under this act to be $61,149.35 effective July 1, 2024.
What do Chicago businesses need to do?
Review your employment practices to ensure you are in compliance.
Now that we’ve looked back, let’s look forward to 2025
- Changes to the Equal Pay Act
An amendment to the Illinois Equal Pay Act (IEPA) will become effective as of January 1, 2025, and will impact the recruiting process of any employer with 15 or more employees.
The amendment requires certain employers to include the pay scale and benefits on any job posting. Additionally, it will require all posted promotion opportunities to be made available to current employees. The amendment details certain other requirements and changes that we talk about more here.
What do businesses need to do?
For all employers, review any and all job postings that will be active as of January 1, 2025, and ensure that they include a pay scale that fits the legal requirements.
This isn’t the only recent amendment to the IEPA. Back in March 24th of 2024, another change required any employer of a 100 or more employees to obtain an Equal Pay Registration Certificate, and will require these employer to be recertified every two years.
What do businesses need to do?
For businesses with over 100 employees, ensure you stay up to date with the Equal Pay Registration, more information can be found on the Illinois Department of Labor’s website here.
- Increase in Minimum Wage
As always, the minimum wage will increase in Illinois starting January 1, 2025. This year, the minimum wage will rise from $14 to $15 per hour. While this is the statewide minimum wage, be aware that the City of Chicago has higher minimum wages for different types of employers, currently, employers with 4 or more employees have a minimum wage of $16.20 per hour.
If you have questions about the content of this blog or employment law needs, contact Navigant Law Group, LLC at (847) 253-8800 or email us at hello@navigantlaw.com.
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