Policies Can Help Employers Comply with the Illinois Paid Leave for All Workers Act

[Editor’s note: This article has been corrected to clarify that “employer” also means the state and units of local government, but not school districts and park districts.]

The Illinois Paid Leave for All Workers Act (PLFAW Act) provides 40 hours of paid leave per year, frontloaded or accrued, for any purpose. That has some employers worried that the law is ripe for leave abuse. Written policies can help address these concerns.

Employers’ most-often-repeated concern is the breadth of employees’ right to take PLFAW Act leave at any time, for any reason, potentially without any advance notice, and without ramification, said Jennifer Long, an attorney with Duane Morris in Chicago.

Frontloading or Accrual of Leave

“Employers may want to consider annual frontloading of a separate bank of 40 hours—prorated for part-time employees—that is designated as PLFAW-compliant leave,” Long said. The annual period may be any 12-month period—such as a calendar, fiscal or anniversary year—that’s communicated to employees in advance. For the initial effective date of the act, current employees had to be provided frontloaded time, or begin accruing at a rate of 1 hour per 40 hours of work, on Jan. 1, although they may not be entitled to use such time until March 31, Long said. Employees must be employed at least 90 days before they are entitled to use paid leave under the law.

Employers providing a frontloaded bank can consider including provisions that prohibit carryover of unused time from year to year and payout at termination, she added.

“All employers—whether using a frontloaded or accrual basis for granting time—can include reasonable notification provisions that require up to seven days’ advance notice for using PLFAW leave for foreseeable reasons, and as soon as practicable for unforeseeable reasons,” Long said.

Other Policy Considerations

Policies should provide notice of circumstances during which the employer may deny an employee’s request to use PLFAW Act leave due to operational necessity. “Employers should provide examples of reasons specific to their business where operational necessity may require denial of an employee’s request,” Long said.

Employers should consider whether they want to insist that employees take larger minimum increments of paid leave—which may deplete their leave bank at a quicker pace—or allow them to use the time in smaller increments to fit their specific needs, said Sara Eber Fowler, an attorney with Seyfarth in Chicago.

For example, if an employee needs to attend a brief appointment, they may be able to be back at work sooner than two hours. “For some employers, it would be more beneficial to have that employee back at work as soon as possible,” she said.

Also, employers may want to align the increments of use with their other timekeeping practices, Fowler said. “For many national employers, other sick leave laws require smaller increments of use, and aligning leave policies may be ideal,” she said. “Employers should consider what makes the most sense given their workplace culture and other compliance requirements.”

The PLFAW Act doesn’t specifically require a written policy, Fowler noted.

However, if employers want to include notification mandates requiring employees to provide advance notice when they need to take leave, they have to include that in a written policy that explains the procedures to provide notice, she said.

“Beyond what is legally required, we strongly recommend employers implement a policy that explains employees’ paid leave rights and obligations consistent with this law,” Fowler said.

She said the policy should specify:

• Who is eligible.
• When employees can begin using leave.
• How much leave they may receive.
• Whether the leave is accrued or granted.
• Any associated carryover or year-end forfeiture.

This will help employees and those enforcing the policy ensure they are on the same page, Fowler said.

What if the Employer Already Has Paid-Time-Off Policies?

Employers that already had time-off policies as of Jan. 1 that cover the 40 hours of leave that is required per year do not have to create separate, new leave banks—so long as the time off can be used for any reason, Fowler said.

“The Illinois Department of Labor has said that if employers have such policies, they do not have to modify other terms of that existing policy, like increments of use,” she explained.

Exemptions

Employers that are required to comply with either the city of Chicago or Cook County, Ill., paid leave ordinances are exempt from the PLFAW Act’s requirements, Long said.

Cook County adopted the Cook County Paid Leave Ordinance, effective Dec. 31, 2023, modeled on the PLFAW Act. The new Chicago Paid Leave and Paid Sick and Safe Leave Ordinance’s implementation has been delayed until July 1.

The PLFAW Act includes state and units of local government in its definition of a covered employer but does not include school districts and park districts. Employees in industries that are covered under current collective bargaining agreements (CBAs) in effect on Jan. 1 will not be affected, and CBAs taking effect after Jan. 1 may expressly waive coverage under the act, Long said.

Coordination of Leave

Illinois joined Maine and Nevada when it passed its PLFAW Act.

Coordination of state and local requirements is a challenge, according to Christine Walters, SHRM-SCP, founder of HR consultancy FiveL Company and a lawyer in Westminster, Md.

She noted that in Maryland alone, there are at least 10 types of paid and unpaid leave mandates:

• Bereavement leave.
• Crime victims leave.
• Jury leave.
• Flexible leave.
• Organ/bone marrow donation leave.
• Parental leave.
• Sick leave.
• Two types of military leave.
• Voting leave.

In addition, one local jurisdiction has its own paid sick leave mandate that is more generous than the state law in some respects, she added.

“If those were compressed into one leave law that covered paid leave for all those reasons, that would significantly reduce the current administrative burden that so many employers face,” so long as the state law pre-empted all other state and local paid leave mandates, Walters said.