Jun 22, 2016

Starting next July, Chicago joins a number of other cities in requiring paid sick leave

On July 1, 2017, the City of Chicago will join over 20 municipalities, including New York City, San Francisco, Seattle and Portland, Oregon, in requiring employers to provide paid sick leave to their employees.

Are you an employer? If you maintain a business facility in Chicago and/or are subject to one or more of Chicago’s licensing requirements and employ four or more employees, not counting your family, you may be subject to this new law. In addition, if you employ even one domestic worker in Chicago, you also will be covered by this statute.

Who is a covered employee? Employees who work at least 80 hours for an employer within a 120-day period are eligible for paid sick leave. This is a change for many part-time employees who otherwise may be ineligible for paid time off offered by their employers because of their part-time status.

How do tipped employees accrue paid sick leave? Employers of tipped employees must pay at least the full Chicago minimum wage, which in July 2017 will be $11per hour, for hours of paid time off earned under this ordinance.

How is paid sick leave calculated for exempt employees? Covered employees who are exempt from overtime requirements will be assumed to have worked 40 hours in each work week for purposes of accruing paid sick leave, unless their normal work week is less than 40 hours, in which case their paid sick leave will accrue based on their normal work week.

What if you have a collective bargaining agreement? If there is a collective bargaining agreement between the employer and its employees that mandates paid time off or sick leave, this ordinance does not supersede that.

What happens to untaken paid sick leave at separation from employment? When covered employees retire, are terminated or separated from employment, employers do not have to pay out the paid sick leave. This is different from accrued, but untaken, paid time off or vacation pay, which must be paid under the Illinois Wage Payment and Collection Act.

How much and when is paid time off accrued? paid sick leave begins accruing on the first calendar day after a covered employee starts working or on July 1, 2017, whichever date is later. For every 40 hours worked, a covered employee accrues one hour of paid sick leave. It does not accrue fractionallyonly in hourly increments.

Is there a cap on paid sick leave? There is a cap of 40 hours of paid sick leave accrued per 12-month period. The 12-month period is calculated from the start of employment or July 1, 2017, whichever is later.

Can a covered employee carry over paid sick leave? Yes. Covered employees can carry over up to half of their unused, accrued paid sick leave, but only up to 20 hours. However, if employers are subject to the federal Family and Medical Leave Act, covered employees can carry over up to 40 additional hours of unused accrued paid sick leave – to a total of 60 hours.

What if an employer already offers paid time off? If an employer already provides paid time off in an amount and manner that meets the requirements of this law, the employer is not required to provide additional paid leave.

How can paid time off be used? Covered employees can begin using paid sick leave no later than 180 days after they commence employment, but can use no more than 40 hours per 12-month period (unless an employer sets a higher limit). For employers that offer Family and Medical Leave, covered employees can use an additional 20 hours. Covered employees can choose how much accrued paid sick leave to use, but employers may set a reasonable minimum increment requirement of not more than four hours per day.

When can paid sick leave be used? Covered employees may use paid sick leave for their own illness or injury or to receive medical care, treatment, diagnosis or preventive medical care. Likewise, covered employees may use paid sick leave when members of their families are sick, injured or receiving medical care, treatment, diagnosis or preventive medical care. In addition, covered employees may use paid sick leave if they or members of their family are victims of domestic violence or a sex offense. In addition covered employees may use paid time off if their business is closed due to a public health emergency or if their children’s schools or day care are closed due to a public health emergency.

Employer cannot make a covered employee find a replacement worker.

Is notice necessary? Yes. Covered employees must give seven days’ notice if their need for paid sick leave is reasonably foreseeable or as soon as practicable if not reasonably foreseeable.

No retaliation. An employer may not retaliate against a covered employee for requesting and using paid sick leave.

Employers must post notice.* Every employer within the geographic boundaries of the city, but not households serving as worksites for domestic workers, must post a notice advising covered employees of the current minimum wage and their rights to paid sick leave.

Employers must provide notice.* With the first paycheck issued to a covered employee, the employer must advise the covered employee of his or her rights to paid sick leave.

Violations. If an employer violates the paid sick leave provisions of this new ordinance, the affected covered employee may recover in a civil action damages up to three times the full amount of any unpaid sick time and interest calculated at the prevailing rate, plus costs and reasonable attorneys’ fees.

While this ordinance will not take effect until next year, employers in Chicago are advised to acquaint themselves with the new law and its notice obligations. To discuss this further, contact one of Chuhak & Tecson, P.C.’s Employment Law attorneys.

* Notices to be prepared and made available by the Commissioner.

This Chuhak & Tecson, P.C. communication is intended only to provide information regarding developments in the law and information of general interest. It is not intended to constitute advice regarding legal problems and should not be relied upon as such.

Client alert authored by: Jeralyn H. Baran, Principal