A bunch of legal updates take effect for small businesses in 2023.
- One new law expands the definition of “racial discrimination” to include hair.
- One new law increases the minimum wage.
- One new law increases workers’ rights to take leave.
- One new law bans latex gloves in food service establishments.
- An upgrade to an existing law provides employers with a way to offer retirement accounts to their employees.
What laws are going into effect in Illinois 2023?
New year, new laws! In our 2023 annual legislative digest for Illinois’ small business community, we highlight four new laws that take effect this year and one existing law getting an upgrade. Please note: this post covers only some of the new legislation taking effect this year and, while these laws certainly effect small businesses, there may be others as well. These laws make the following changes:
- Expand the definition of “racial discrimination” to include hair.
- Increase the minimum wage.
- Increase workers’ rights to take leave.
- Ban latex gloves in food service establishments.
- Provide employers a way to offer retirement accounts to their employees.
The CROWN Act
The CROWN Act, which stands for the Create a Respectful and Open Workplace for Natural Hair Act, amends the Illinois Human Rights Act. It aims to fight discrimination in Illinois by prohibiting hair-related racial discrimination. The law widens the definition of race to include “traits associated with race, including, but not limited to, hair texture with protective hairstyles such as braids, locks, and twists.”
The CROWN Act expands 2021’s Jett Hawkins Act, which banned hairstyle discrimination in Illinois schools, to now cover workplaces, housing programs, and other areas of daily life.
Minimum wage for 2023 in Illinois
The minimum wage in Illinois rose from $12/hour to $13/hour this year as a result of 2019’s Lifting Up Illinois Working Families Act, which plans to incrementally increase the minimum wage to $15/hour by 2025.
Wages for tip-earning workers increased to $7.80/hour. However, per the law, “these workers must still earn the minimum wage after receiving tips, or the employer is required to make up the difference.”
Workers under 18 who work fewer than 650 hours a year must make a minimum of $10.50/hour.
The minimum wage for Chicago employers with more than 20 workers increased to $15.40/hour this past July and will increase again this year by 2.5% or the rate of inflation, whichever is lower (three guesses what that will be).
Cook County’s minimum wage for tipped workers increased to $7.80 in tandem with the statewide increase, but the minimum wage for non-tipped workers remained at $13.35/hour. Many county municipalities opted out, however – check with your local city, township, or village.
Bereavement Leave Illinois
The Family Bereavement Leave Act has been amended to expand unpaid leave rights for workers in Illinois.
Under the new law, employees have the right to take ten days of unpaid leave to attend the funeral for, make arrangements for, or grieve the death of a family member such as a “child, stepchild, spouse, domestic partner, sibling, parent, mother-in-law, father-in-law, grandchild, grandparent, or stepparent.” Employees are also entitled to ten days of unpaid leave due to fertility-related issues such as a miscarriage, unsuccessful round of assisted reproduction, failed adoption, or stillbirth.
Under the law, employers may request documentation to prove that an employee’s request for leave is for an event covered by the act. However, employees need not disclose the event that qualifies them for the leave. The documentation can include death certificates, published obituaries, and documentation from an adoption or surrogacy organization.
Illinois Latex Glove Ban
The new Latex Glove Ban Act prohibits food service establishments and their employees from using latex gloves in the preparation and handling of food. The law also prohibits emergency personnel from using latex gloves. After January 1st, 2024, healthcare workers will also be banned from using the gloves.
The law provides an exception in case of emergency. It specifies that “If latex gloves must be used in the preparation of food due to a crisis that interrupts a food service establishment’s ability to source nonlatex gloves, a sign shall be prominently placed at the point of order or point of purchase clearly notifying the public of the temporary change.”
To ensure that businesses follow this new law, the Department of Public Health “shall send a notice of warning to a food service establishment for its first violation.”
Secure Choice: Retirement Plan Requirements for Employers in Illinois
The Illinois Secure Choice Savings Program provides employers with a way to help their employees save money for retirement. The program began in 2018, with a phased implementation occurring over time. 2023 is the final year of the phase-in, and it brings some new requirements for employers.
By November 2023, Illinois businesses with at least 5 employees, that have been in business for two or more years, and who do not currently provide a retirement plan must either begin offering a qualified plan or automatically enroll their employees into Secure Choice.
Employers need to register for the program, provide employee information for the creation of accounts, and facilitate payroll contributions. However, unlike traditional retirement plans, employers do not pay any fees or contributions into the accounts, and they are not responsible for plan paperwork or administration.
Under this law, employers can still set up and sponsor their own retirement plans, “such as a defined benefit plan or a 401(k), Simplified Employee Pension (SEP) plan, or Savings Incentive Match Plan for Employees (SIMPLE) plan, or to offer an automatic enrollment payroll deduction IRA.”
As stated in the law, workers who enroll in the program will “have the ability to select a contribution level into the Fund. This level may be expressed as a percentage of wages or as a dollar amount.”
Whenever new laws come into effect, we recommend taking a second look at your business to make sure you remain compliant. This year, that means revisiting your employment documents.
Our employment services cover a suite of fundamentals – check them out to see if they could benefit you!
Reach out if you have any questions or think you’re due for a refresh.