Illinois Labor Law Changes in 2025: Is Your Business Ready?

Illinois Labor Law Changes in 2025: Is Your Business Ready?

Proactive compliance: Steps to prepare for new Illinois labor laws
4/10 Work Schedules

Employment laws in Illinois are changing in 2025, redefining the state’s rules on discrimination, child labor, pay transparency, retaliatory efforts, and more. 

This article will examine several of the changes set to take place on Jan. 1, 2025, define their potential impact on your business, and share some of the actions you can take today to ensure your company is prepared. 

Please note that labor laws are constantly changing. For ongoing updates, please refer to the Illinois Department of Employment Security

Pay Transparency

Illinois employers with 15 or more employees must include pay scale and benefits information in all job postings. This requirement, an amendment to the Illinois Equal Pay Act, applies to positions that will be physically performed in Illinois or involve remote work where the employee reports to an Illinois-based supervisor or office.

The law defines “pay scale and benefits” as the wage or salary, or a range, along with a general description of additional compensation, such as bonuses, stock options, or other incentives. Benefits may also include health and retirement plans, all of which must be disclosed either directly in the job posting or via a link to a public webpage containing this information.

If employers use third-party services for job postings, they are responsible for ensuring these postings include the required details. Third-party providers may be held liable if this information is missing unless they can prove the employer did not supply it.

Furthermore, the law introduces guidelines for internal promotions, requiring that current employees be informed of such opportunities within 14 days of any external job posting for the same position. Failure to comply with these regulations could result in fines ranging from $250 for first-time offenses to $10,000 for repeat violations.

Payroll Obligations 

Amendments to the Illinois Wage Payment and Collection Act (WPCL) will introduce new payroll obligations for employers. Under the revised law, SB 3208, employers must issue a pay stub to employees each pay period, replacing the current requirement for an itemized statement. This pay stub must include details such as hours worked, gross wages earned, deductions, and year-to-date totals for both wages and deductions.

Employers must also retain copies of each employee’s pay stubs for at least three years after the payment date, regardless of whether the employee is still with the company. Employees and former employees can request copies of their pay stubs, which employers must provide within 21 days. Employers are limited to responding to no more than two such requests from a current employee per year and no more than one year after separation for former employees.

Noncompliance with these new requirements may result in civil penalties of up to $500 per violation. 

Discriminatory Employment Policies 

Illinois employers must adhere to several significant updates to the Illinois Human Rights Act (IHRA), which are designed to expand protections for employees. These changes reflect the state's ongoing commitment to combat discrimination and create a more inclusive workplace.

  1. Extended Filing Period for Discrimination Claims: One of the most impactful changes is the extension of the statute of limitations for filing workplace discrimination, harassment, or retaliation claims. Employees will now have two years — a drastic increase from the previous provision of 300 days — to file a complaint with the Illinois Department of Human Rights (IDHR). This change provides a longer window for employees to seek recourse, particularly those who work for smaller employers not covered under federal employment laws like Title VII.
  2. Protection for Reproductive Health Decisions: The IHRA will also add "reproductive health decisions" to its list of protected categories. Thus, starting in 2025, employers are prohibited from discriminating against employees based on their reproductive choices, including contraception use, fertility treatments, miscarriage care, and decisions related to pregnancy termination. This amendment reinforces Illinois' strong stance on protecting reproductive freedom in the workplace.
  3. Family Responsibilities as a Protected Class: Another notable update is the addition of "family responsibilities" as a protected category under the IHRA. Employees who provide personal care to family members, such as attending medical appointments or caring for sick relatives, are now shielded from discrimination, harassment, or retaliation. While employers are not required to accommodate requests for time off to meet these responsibilities, they cannot take adverse actions against employees solely because of their caregiving duties.
  4. Increased Regulation of Artificial Intelligence (AI) in Employment Decisions: Looking ahead to Jan. 1, 2026, Illinois will begin regulating the use of AI in employment decisions. Employers will be required to notify employees and applicants when AI is used for recruitment, hiring, promotions, and other employment-related activities. Additionally, the IHRA amendment restricts the use of AI tools if they have a discriminatory effect, and employers are prohibited from using proxies, like zip codes, that could indirectly discriminate against protected classes.

Child Labor Laws

Illinois will implement the "Child Labor Law of 2024," which replaces the state’s previous child labor regulations with a more stringent framework aimed at protecting minors under the age of 16. This law is designed to strengthen protections for young workers and prioritizes their health, safety, and educational needs.

The law imposes strict limits on the number of hours minors can work. Key restrictions include:

  • No more than 18 hours per week when school is in session;
  • No more than 40 hours per week when school is not in session;
  • No more than eight hours in any 24-hour period;
  • Working between 7 p.m. and 7 a.m. from Labor Day until June 1, and between 9 p.m. and 7 a.m. from June 1 until Labor Day is prohibited; and
  • On school days, minors cannot work more than three hours or exceed a combined total of eight hours of work and school.

Employers wishing to hire minors must comply with several new requirements. Accordingly, employers must:

  • Obtain an employment certificate for each minor, which must be kept on file at the worksite for the duration of employment and for three years afterward;
  • Ensure the minor is supervised by an adult aged 21 or older at all times while working;
  • Provide minors with a 30-minute meal break if they work more than five consecutive hours; and
  • Post a summary of the law’s requirements in a conspicuous location at the worksite or, for remote workers, distribute the notice digitally.

In addition to federal restrictions, the new law outlines more than 30 occupations minors cannot engage in, such as factory work, construction, and the handling of alcohol. Penalties for violating the law range from $500 for posting violations to $60,000 if a minor dies as a result of working in violation of the act.

The law also introduces special rules for minors working as models, performers, or in theatrical roles, including work-hour restrictions and a requirement for employers to establish trust accounts for these workers.

What Steps Should You Take Today?

These new laws will impact multiple aspects of your operations, from updating job postings to including pay transparency information to adjusting payroll practices and ensuring compliance with anti-discrimination measures.

Is your business adequately prepared? Staying ahead of these changes not only helps you avoid fines and penalties but also fosters a fair and compliant workplace that supports employee rights. Implementing employee time tracking and payroll tools, like those offered by OnTheClock, can streamline compliance with many of these new obligations, such as tracking hours worked, automating pay stub reporting, and managing employee time-off accrual.

By taking proactive steps now, your company can meet these new requirements smoothly and maintain focus on growing your business. As labor laws continue to evolve, tools like OnTheClock can help you stay compliant and operate more efficiently in 2025 and beyond.

For more information on how OnTheClock can support your compliance efforts, visit www.ontheclock.com

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