Legal updates

April 25, 2023

    By now, most Illinois public employers presumably have heard about their obligations under the Paid Leave for All Workers Act, 820 ILCS 192/1 et seq., which is scheduled to take effect on January 1, 2024. The Act will apply to most Illinois public employers (with the exception of park districts, school districts and perhaps municipal and county public works departments). In that respect, the Act could significantly affect the way public employers provide leave to their workers. This alert summarizes the key provisions of the law, but also goes further and identifies several ways in which public employers might potentially exempt themselves (and even other employers) within their borders from the burdensome provisions of the Act.

Among other things, Illinois public employers face the prospect of having to provide one (1) hour of leave for every 40 hours worked by all their employees (including part-time and seasonal employees). Employees must also begin accruing leave under the Act on their first day of employment, and must be allowed to begin using their leave 90 days after their hire date. Perhaps most significantly, there is a provision that limits an employer’s ability to deny the use of paid leave by multiple employees, even if that multiple usage would leave the employer with a depleted workforce and/or an inability to conduct crucial government operations. These and other provisions obviously differ from the standard paid leave provisions that most Illinois employers have adopted via policy or in a collective bargaining agreement.

The good news is that there are definitely opportunities that many municipalities may want to pursue as a way to avoid the harsh realities of the Act. These opportunities include collective bargaining agreement exemptions, the exercise of a municipality’s home rule authority, and perhaps the enactment of local sick leave ordinances by non-home rule municipalities.

 A.       Collective Bargaining Agreements

 Section 15(n) of the Act states that “[n]othing in this Act shall be deemed to affect the validity or change the terms of bona fide collective bargaining agreements in effect on January 1, 2024.” Although no legislative history or case law has yet shed light on the meaning of this provision, a fair reading of this sentence strongly suggests that collective bargaining agreement terms in effect on January 1, 2024, will trump any contrary requirements found in the Act.

As to bargaining agreements that expire after January 1, 2024, the requirements of the Act can still be waived via collective bargaining, but the Act plainly states the waiver must be “set forth explicitly in such agreement in clear and unambiguous terms.” Absent an explicit waiver, an employer presumably will have to comply with the Act, absent adoption of one of the following alternative exceptions.

In light of this provision, government employers should weigh the pros and cons of completing successor contract negotiations prior to January 1, 2024. If a public employer can secure a multi-year agreement before January 1, 2024, it may be able to forestall the Act’s application to bargaining unit members for several more years.

 B.       Home Rule Authority

Approximately 221 Illinois municipalities (in addition to Cook County) are classified as “home rule units of local government.” Under Article VII, Section 6 of the Illinois Constitution, a home rule unit is permitted to pass local legislation “pertaining to its government and affairs, including but not limited to, the power to regulate for the protection of the public health, safety, morals and welfare; to license; to tax; and to incur debt.” Absent an express home rule preemption in a statutory enactment or the application of one of the constitutional exceptions found in Article VII, home rule units typically can exempt themselves and their workforces from a variety of Illinois employment laws.

In this case, the Paid Leave for All Workers Act does not contain an express home rule preemption, nor does one of the constitutional exceptions to home rule authority appear to apply to the Act’s provisions. As a result, a home rule unit presumably can enact an ordinance that totally exempts itself and its employees from the Act’s coverage.

In addition, there is the prospect for home rule units exempting private employers and other units of government, such as library districts or fire districts, that operate within the government entity’s geographic boundaries, should the home rule unit wish to do so. In that respect, an argument can be made that a home rule unit has a vital interest in protecting the public health and welfare by avoiding the shutdown of multiple businesses by employees who en masse decide to simultaneously take advantage of the Act’s paid leave provisions without advance notice. In the wake of Illinois’s recent experiences with COVID-19, many home rule communities presumably do not relish the prospect of a repeat “shut down” of its local business community due to the Act’s poor draftsmanship.

While this option is available only to home rule jurisdictions, yet a third option to consider is the enactment of a local paid leave ordinance. As will be described below, such an ordinance arguably is an option for both home rule and non-home rule communities alike.

C.       Local Paid Leave Ordinances

For those non-home rule units of local government which cannot self-exempt themselves from the Act, creative opportunities may still exist for avoiding the Act’s provisions. One such opportunity is found in Section 15(p) of the Act, which states that “the provisions of this Act shall not apply to any employer that is covered by a municipal or county ordinance that is in effect on the effective date of this Act [i.e., January 1, 2024], that requires employers to give any form of paid leave to their employees, including paid sick leave or paid leave.”

Although open to some debate, an argument can be made that this provision authorizes even non-home rule units of local government to enact their own local paid leave ordinances, which in turn would apply to the government unit itself along with all other employers within its municipal or county boundaries. If correct, a non-home rule unit arguably could then impose paid leave obligations on itself and other employers that address some of the more unreasonable provisions of the Act (including for example an employer’s apparent inability to deny leave requests if the employee absence would unduly interfere with the delivery of vital government services). According to the plain language of Section 15(p) of the Act, as long as such a paid leave ordinance is in effect by January 1, 2024, the non-home rule community and its businesses would not have to comply with the Act.

D.       Mandates Act

An additional option may be available, especially for those public employers that do not have the power to pass ordinances as suggested above. In that respect, the Paid Leave for All Workers Act does not include a specific exemption from the application of the Illinois “State Mandates Act.” That means units of local government may not be legally obligated to comply with the Act in the absence of a sufficient state appropriation to cover the additional cost of complying with the Act’s mandate to provide paid leave in situations where it is not already provided. Those public employers who are interested in pursuing this legal defense should consult their labor counsel to determine its feasibility and the procedural framework for raising it.

E.       Bargaining Implications of Pursuing the Above Options

As with most employer decisions, labor organizations may attempt to bargain over certain aspects of a government employer’s attempt to exempt itself from the Paid Leave for All Workers Act. However, public employers have fairly strong arguments that a properly timed and drafted ordinance that exempts the employer from the Act is non-negotiable. In that respect, a number of Illinois public employers successfully defended against bad faith bargaining charges in 2020 and 2021 in response to the employers’ self-exemption from the paid leave provisions of the Families First Coronavirus Response Act (FFCRA). In that context, the Illinois Labor Relations Board’s Executive Director ruled that there was no duty to bargain over the employer’s decision to exempt its public safety personnel from the FFCRA’s paid leave provisions (especially when the self-exemption occurred prior to the FFCRA’s effective date). Parallels obviously can be drawn to attempts at exempting a government entity from the Act’s coverage by enacting one of the above-described ordinances prior to January 1, 2024.

That being said, labor counsel should be consulted before taking advantage of one of the above-described options, in order to ensure that any potential bargaining obligations have been fully considered and addressed.

F.        Time is of the Essence

 Whatever an Illinois public employer decides to do with respect to the Act, it has a little over 8 months to do it. As a result, now is the time to begin considering the best options for your local government employer. If your employer decides to forego one or more of the above options, it should at the very least begin examining its accrued leave procedures to identify what (if any) changes must be made before January 1, 2024 in order to ensure compliance with the Act.

Please contact a Clark Baird Smith LLP attorney for more information regarding these options (and the potential bargaining implications of adopting the same).

    This CBS LLP Client Alert is prepared for general information purposes only. Summaries of recent court opinions and other legal developments are not necessarily inclusive of all the recent legal authority of which you should be aware when making your legal decisions. Thus, while every effort has been made to ensure accuracy, you should not act on the information contained herein without seeking more specific legal advice on the application and interpretation of these developments to any particular situation.

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