Understanding Requirements of the Amended Illinois Equal Pay Act

Summary of the Amendment

On May 17, 2023, the Illinois Legislature passed HB3129 which amends the Illinois Equal Pay Act. The amendments now make it unlawful for employers with 15 or more employees to fail to include a description of the benefits and pay scale for a position in any specific job posting. Within the meaning of the amendments, “pay scale” and “benefits” are defined as the “wage or salary, or the wage or salary range, and a general description of the benefits and other compensation, including, but not limited to, bonuses, stock options, or other incentives the employer reasonably expects in good faith to offer for the position.” Notably, these amendments will impact both private and public sector employers, as the term “employer” encompasses an “individual, partnership, corporation, association, business, trust, person, or entity for whom employees are gainfully employed in Illinois and includes the State of Illinois, any state officer, department, or agency, any unit of local government, and any school district.” Employers must meet this new requirement by January 1, 2025.

Meeting the Requirements

To meet the pay scale and benefits disclosure requirement, employers may include a hyperlink to a publicly viewable webpage, which includes relevant benefits and pay information. Specifically, “[p]osting of a relevant and up-to-date general benefits description in an easily accessible, central, and public location on an employer’s website and referring to this posting in the job posting shall be deemed to satisfy the benefits posting requirement under this subsection.” Additionally, to determine if compliance is necessary, an employer will need to determine if the job will be physically performed (at least in part) in Illinois, or, whether the job will be physically performed outside of Illinois, but the employee reports to a supervisor, office, or other work site in Illinois.

In the event the employer did not make pay scale and benefits disclosure through public or internal disclosures, the employer “shall disclose… the pay scale and benefits to be offered for the positions prior to any offer or discussion of compensation and at the applicant’s request.” An employer may not refuse to interview, hire, promote, or employ an applicant for exercising these rights. If an employer utilizes a third party to announce, post or publish jobs, the employer must provide pay scale and benefits information to the third party.

Further, employers will be required to alert current employees to any opportunity for promotion. This applies to any positions that will either be performed in Illinois or supervised by someone in Illinois. The communication must occur no later than fourteen calendar days after the job is posted externally. This amendment does not apply to positions in the State of Illinois designated as “exempt from competitive selection.”

Enforcement

With respect to enforceability, the Illinois Department of Labor (IDOL) may investigate compliance with the HB3129 amendments. These investigations may be discretionary or may result from a complaint from an individual from within one year of the violation. If it is determined that a violation occurred, an employer must remedy the violation, and proffer proof to the IDOL, within seven days. If an employer fails to remedy, it is subject to civil penalties. Depending on how many offenses an employer receives, the cure period and fine will vary.

Illinois has followed behind California, New York, and Colorado in its efforts to address pay inequality. Illinois employers should use this time to modify their job posting protocols and develop all necessary pay scale and benefits information that will need to be disclosed.