Preparing for Chicago and Cook County's New Paid Sick Leave Ordinances

In the past few years, several states and cities across the United States have passed laws requiring employers to provide paid sick leave to their employees. In 2016, the City of Chicago and Cook County became the first jurisdictions in Illinois to enact paid sick leave ordinances. These ordinances, which are substantially identical, go into force on July 1, 2017. As this date rapidly approaches, employers should make sure to understand the requirements of the ordinances.

The new ordinances apply to employers of any size with a business location in Chicago or most parts of Cook County, although the municipalities of Barrington, Bedford Park, Mount Prospect, Oak Forest, River Forest, Rosemont and Tinley Park have passed ordinances opting out of the Cook County ordinance and other villages are considering similar measures. Employees who work for an employer for at least 80 hours in a 120-day period will be entitled to receive paid sick leave, so long as the employees work at least two hours in Chicago (or those parts of Cook County where the ordinance will be in force) in any two-week period. Beginning on July 1, 2017, employees will accrue paid sick leave at a rate of one hour of sick leave per 40 hours worked, up to a maximum of 40 hours of paid sick leave in a 12-month period. For accrual purposes, exempt employees will be credited with 40 hours of work per week unless they work fewer hours. The 12-month accrual calendar will begin either on July 1, 2017 or, for employees hired after July 1, 2017, on their first day of employment. At the expiration of the 12-month period, employees of any sized employer can “carry over” up to 20 hours of unused accrued paid sick leave to the next 12-month period. Moreover, employers subject to the federal Family and Medical Leave Act (“FMLA”) must permit employees to carry over up to an additional 40 hours of unused paid family leave to be used for purposes covered by the FMLA (which is slightly more restrictive than the Chicago and Cook County ordinances). Employers do not have to pay employees for unused paid sick leave upon termination.

Employers must grant an employee the right to use paid sick leave no later than 180 calendar days after his or her first day of work. Paid sick leave can be used for illnesses, injuries, medical care, domestic violence situations or public health emergencies affecting either an employee or an employee’s family member. Unlike the FMLA, family members include any blood relative or anyone else with a close enough association with the employee to have the equivalent of a family relationship. An employer can require employees to provide notice up to seven days before the absence if the reason for the paid sick leave is reasonably foreseeable. If the need for leave cannot be reasonably anticipated, an employee may notify the employer of the need to take time off as soon as is practicable on the date of absence via telephone, email or a text message. Employers may also require employees absent for more than three consecutive days to provide a medical certification from a licensed healthcare provider, or a court record, police report or similar documentation for a domestic violence situation. Further, employers can specify the minimum amount of paid sick leave that can be used at any one time, so long as the designated increment is no larger than four hours per day. However, employers are prohibited from requiring notice to be given when an employee is medically incapacitated or from requiring an employee needing leave to find a replacement worker.

The ordinances provide that paid sick leave needs to be compensated at the same rate as is paid for the equivalent amount of work, with the same benefits also provided. If a substantial part of an employee’s pay is based on gratuities, the hourly rate of pay for sick leave for the employee must at least be minimum wage. However, absences covered by the ordinances are not considered hours worked for purposes of federal and state overtime laws and an employer does not need to compensate an employee at the overtime rate while the employee is receiving paid sick leave.

The ordinances impose significant penalties on violations by employers. Employers will be prohibited from retaliating against employees who attempt to exercise any rights under the ordinances. Employers also may not count paid sick leave days as absences for disciplinary purposes.  If an employer violates the ordinances by taking these actions, or engaging in any other violation, an aggrieved employee has the right to sue the employer for damages equal to three times the full amount of unpaid sick leave that is denied or lost due to the violation, plus reasonable attorneys’ fees. 

Chicago and Cook County employers should immediately examine their current sick leave procedures to avoid the potential risks and costs posed by the ordinances. If an employer already has a paid sick leave policy that provides at least 40 hours of paid sick leave per year, the employer may need to do little or nothing. It is noteworthy that the ordinances specifically provide that it is acceptable for an employer to immediately award employees at least 40 hours of paid sick leave per calendar year once they become eligible (instead of using an accrual system). Employers who already offer sufficient paid sick time off (whether immediately granted or determined on an accrual basis) should simply ensure that their policies do not limit eligibility for use of paid sick leave or the “carry over” of unused sick leave any more severely than the ordinances.  

Employers who do not currently offer paid sick leave need to assess how they will monitor the accrual and use of paid sick leave. In many cases, employers may be able to use the same types of tracking systems as are used for paid vacation days. Nonetheless, employers without a paid sick leave policy should determine who will be responsible for administering paid sick leave and ensure that any new procedures they may implement fully comply with the ordinances. To avoid any possible disputes about how soon notice of an absence must be provided, the minimum increments of sick leave allowed and what type of certification is required to return to work, it is also advisable for employers to adopt a written sick leave policy if they do not already have one.

Finally, all Chicago or Cook County employers must be aware that by July 1, 2017, they must post a notice in a conspicuous location in the workplace advising employees of their rights under the Chicago and/or Cook County ordinances. This notice also needs to be furnished to existing employees with their first paycheck after July 1, 2017 and to new employees at the time of hiring. While final versions of the notice have not been drafted by the Chicago Department of Business and Consumer Affairs or the Cook County Human Rights Commission at the time that this blog was posted, a draft template can be viewed and downloaded at the following link: https://www.cookcountyil.gov/service/earned-sick-leave-ordinance-0.