At QPS, we have been keeping you informed about the significant legislative changes affecting business in Illinois. As these developments continue to unfold, we want to provide you with the latest updates on the Illinois Day and Temporary Labor Services Act (IDTLSA) amendments and the new Illinois Paid Leave for All Workers Act.
Illinois Day and Temporary Labor Services Act (IDTLSA) Amendments
Background
Governor J.B. Pritzker signed several amendments to the IDTLSA into law on August 4, 2023. These amendments introduced new obligations for staffing agencies and employers utilizing temporary labor, including safety training and notice requirements, as well as equal pay and benefits provisions.
Key Provisions and Court Injunction
Section 42 – Equal Pay and Benefits: This section mandated that temporary laborers working more than 90 days for a third-party client must receive the same pay and equivalent benefits as comparable direct-hire employees. Alternatively, staffing agencies could pay the hourly cash equivalent of the benefits’ cost. The implementation of this provision was delayed to April 1, 2024, but a federal court has now enjoined this part.
In Staffing Services Association of Illinois, et al. v. Flanagan, the court ruled that Section 42’s equivalent-benefits provision is preempted by the Employee Retirement Income Security Act of 1974 (ERISA). The court determined that this provision disrupts the uniform administration of ERISA plans and imposes significant administrative burdens on staffing agencies.
ERISA Preemption: The court found that Section 42 required staffing agencies to undertake complex, individualized evaluations of benefit plans, disrupting uniform administration and creating significant operational challenges.
Irreparable Harm: The court noted the significant costs and operational challenges for staffing agencies in complying with Section 42, justifying the injunction.
Section 11 – Labor Disputes Notification: Requires agencies to inform temporary workers about labor disputes at third-party clients and allows workers to refuse such assignments. This provision remains in effect.
Section 67 – Private Right of Action: Grants individuals the right to enforce the IDTLSA’s provisions through private lawsuits. This provision also remains in effect.
Implications for Your Business
The injunction means that, as of now, staffing agencies are not required to provide equivalent benefits or the cash equivalent for benefits. This decision allows agencies to avoid the administrative and financial burdens associated with this requirement. However, staffing agencies must still ensure equal pay for temporary workers after 90 days at a client site starting April 1, 2024.
Illinois Paid Leave for All Workers Act
Effective January 1, 2024, Illinois implemented the Paid Leave for All Workers Act, mandating employers to provide a minimum of 40 hours of paid leave per year that employees can use for any reason. This law aims to provide greater flexibility and support for workers across the state.
Key Details
Eligibility: All employees in Illinois, regardless of their role or employer size, are entitled to paid leave.
Usage: Employees can use this leave for any reason, with no requirement to disclose the purpose to their employer. Employers are allow to have a “reasonable” policy around the use of paid time.
Accrual and Carryover: Employees accrue leave over time and can carry over unused leave into the next year.
Moving Forward with QPS
The landscape for staffing agencies in Illinois is complex and rapidly changing. At QPS, we are committed to keeping you informed and helping you navigate these changes. Here’s how we can support you:
Compliance Guidance: We will work with you to review and update your policies and practices to ensure compliance with current laws.
Ongoing Support: Our team is here to provide ongoing support and answer any questions you may have about these regulations and their impact on your business.
Proactive Planning: We will help you develop strategies to manage compliance risks and support your workforce effectively amidst these evolving regulations.
If you have any questions or need further assistance, please do not hesitate to reach out to our team. Together, we can navigate these changes and continue to thrive in the dynamic regulatory environment.
You can download the updated employee notices by clicking the links below. Please display with your other legal notices.
