Effective July 1, 2017, Chicago requires employers to provide paid sick leave for eligible employees under the Chicago Minimum Wage and Paid Sick Leave Ordinance (MWPSO). Also effective July 1, 2017, the Cook County Earned Sick Leave Ordinance (ESLO) will govern employers located in areas of Cook County outside the city of Chicago. Many (but not all) of the municipalities within Cook County have lawfully taken advantage of the ability to opt out of these provisions. Any individual or business entity that employs at least one covered employee will be covered by the applicable ordinance, except where the business lies within a municipality that has opted out.
Chicago workers who perform at least 80 hours of work within any 120-day period will begin earning paid sick leave at a rate of 1 hour for every 40 hours worked. Chicago capped the annual accrual at 40 hours, and workers with unused time can carry over up to 20 hours, unless the employer is subject to the Family Medical Leave Act (FMLA), then workers are allowed to carry over up to 40 hours plus any additional time allowed under FMLA.
Both the Chicago and Cook County ordinances offer covered employers the option for providing paid sick leave to eligible employees based on either an accrual system or a more simplified frontloading system. The accrual option allows employees to accrue paid sick leave based on hours worked in the covered jurisdiction, up to the maximum number of hours per year.
The frontloading option available in both ordinances allows employees to receive a lump sum of paid sick leave at the beginning of each year. Although the amount of paid sick leave awarded differs under the two ordinances, both eliminate the need to contend with complex carryover provisions.
Although employers covered under either ordinance will be required to post a notice in each workplace where a covered worker is employed, other requirements vary under each ordinance. Employers covered under the Chicago ordinance will also be required to keep a copy of the ordinance and the final regulations onsite. Covered employers are also required to keep certain personnel and payroll records as prescribed under the ordinance for a minimum of three years.
Employers covered under the Cook County ordinance will be required to provide employees with a written notice regarding their rights under the ordinance with the first paycheck they receive after July 1 or upon hire, and once each calendar year thereafter. Covered employers are also required to keep certain personnel and payroll records as prescribed under the ordinance for a minimum of five years.
To better ensure full compliance with either the Chicago or Cook County paid sick leave ordinance, consider these steps:
- Determine your coverage under the applicable ordinance by reviewing the implementing regulations. Employers in Cook County should take additional steps to confirm coverage at the municipality level.
- Review your company’s current sick leave policy and decide whether you will make adjustments to meet all the provisions under the applicable ordinance or you will create a new policy to ensure full compliance.
- If you are creating a new paid sick leave policy, consider the differences between an accrual-based policy and a frontloading policy before moving forward.
- Be prepared to comply with posting and notice requirements under the applicable ordinance.
Consider how you will track and keep appropriate records related to employee paid sick leave including accruals and carryover (where applicable), availability of paid sick leave, and use of paid sick leave. If you use an outside payroll service, they should be a valuable resource in helping you keep compliant.
If you have any questions about these ordinances and their applicability to your organization, please contact us to discuss.