Applicant’s Unvested Equity or Deferred Compensation
On August 6, 2021, Illinois Governor J.B. Pritzker signed legislation (HB 1207) amending the state’s Equal Pay Act by clarifying that the law doesn’t prohibit employers and applicants from discussing an applicant’s unvested equity or deferred compensation that would be lost if they resign from their current employer. If this is discussed, voluntarily and without prompting, the employer can ask the applicant to verify the total amount they would lose by submitting a letter or document with either the name of their current employer or the business that controls the funds.
The law is effective January 1, 2022.
Artificial Intelligence Video Interviews
On July 9, 2021, the Illinois governor signed the Artificial Intelligence Video Interview Act (HB 53). Under the act, employers that solely rely on artificial intelligence (AI) analysis of an applicant’s video interview – to decide whether they will be interviewed in-person – must collect the following data:
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- The race and ethnicity of applicants who are and aren’t interviewed in-person after using the AI analysis; and
- The race and ethnicity of who is hired.
This data must be reported to the Illinois Department of Commerce and Economic Opportunity by December 31 of every year and must cover the 12 previous months, ending on November 30.
The law is effective January 1, 2022.
Limitations on Noncompete and Nonsolicit Agreements
On August 13, 2021, the Illinois governor signed legislation (SB 672) amending the state’s Freedom to Work Act by prohibiting non-compete and nonsolicit agreements between all employees and employers unless:
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- For non-competes, the employee’s actual or expected earnings are more than $75,000 per year beginning January 1, 2022, $80,000 per year beginning on January 1, 2027, $85,000 per year beginning on January 1, 2032, and $90,000 per year beginning on January 1, 2037.
- For nonsolicit agreements, the employee’s actual or expected earnings are more than $45,000 per year beginning January 1, 2022, $47,500 per year beginning on January 1, 2027, $50,000 per year beginning on January 1, 2032, and $52,500 per year beginning on January 1, 2037.
Even if those terms are met, both agreements are illegal and void unless:
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- The employee works for the employer for at least two years after they enter the agreement, or the employer otherwise gave enough consideration to support the agreement. Consideration can be a period of employment plus additional professional or financial benefits, or just the benefits if they are adequate.
- The agreement is secondary to a valid employment relationship, isn’t more than what is required to protect the employer’s legitimate business interests, doesn’t impose undue hardship on the employee, and isn’t publicly harmful.
Employees must be informed about their obligations under any non-compete or nonsolicit agreement. It must be in writing and given to them at least 14 calendar days before they start work and with at least 14 calendar days to review it. Employers must also advise them to consult with an attorney before agreeing to it.
Additional restrictions added by the law:
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- Employers can’t enter into a non-compete or nonsolicit agreement with any employee who was terminated, laid off, or furloughed because of COVID-19 or a similar pandemic situation. The exception is if the agreement provides an employee with pay that is equal to their base salary when they were terminated minus any money they earned from their work when the non-compete or nonsolicit agreement was in effect.
- Non-competes are prohibited for employees covered by a collective bargaining agreement and those working in construction, except for construction employees that are primarily working in management, engineering or architecture, design, or sales, or who are shareholders, partners, or owners in any capacity of the employer.
The law is effective January 1, 2022.
Personnel Record Review Act
The Illinois Personnel Record Review Act is amended to provide remedies for an employee whose employer or former employer divulged confidential disciplinary information from the employee’s personnel records in violation of the Act. Specifically, the amendments provide for a private right of action that must be filed within three years after the date of the disclosure of the report, letter, or other disciplinary action.
The law is amended effective January 1, 2022.
Victims’ Economic Security and Safety Act Updates
On August 20, 2021, Illinois Governor J.B. Pritzker signed legislation (HB 3582) amending the state’s Victims’ Economic Security and Safety Act, which allows employees to take unpaid leave when they or members of their family or household are victims of violence. The law expands the definition of victim to include an individual who has been subjected to any crime of violence, not just domestic violence, sexual violence, or gender violence. It also expands covered family or household members to include:
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- A party to a civil union.
- Grandparents, children, grandchildren, and siblings.
- Any other person related to the employee by blood or by present or prior marriage or civil union.
- Any other person who shares a relationship with the employee through a child.
- Any other individual whose close association with the employee is the equivalent of a family relationship as determined by the employee.
- Persons jointly residing in the same household.
The law specifically removes references to son or daughter; instead, it uses the term “child” and allows employees to choose whether they submit either a police or court record or other corroborating evidence to their employer. Employers can’t request or require that more than one document be submitted.
The law also expands protections against workplace discrimination even when it is based on an individual being perceived as a victim of violence and requires employers to make any type of reasonable workplace accommodation in response to actual or threatened violence. All information provided to the employer—including a statement of the employee or any other documentation, record, or corroborating evidence, and the fact that the employee has requested or obtained an accommodation—must be kept strictly confidential, except when its disclosure is:
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- Requested or consented to in writing by the employee; or
- Otherwise required by applicable federal or state law.
The law is effective January 1, 2022.