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Chicago's Fair Workweek Ordinance and Minimum Wage Increases Are Here – Are You Ready?

Illinois and Chicago employers navigating reopening during a pandemic now have something else to deal with: new laws taking effect on July 1, 2020. The changes bring not only new state and local minimum wages but also the new Chicago Fair Workweek Ordinance.

These are the new minimum wages taking effect for the State of Illinois, Cook County and City of Chicago:

  • The Illinois rate increases to $10 per hour.

  • The Cook County rate increases to $13 per hour, and the base wage for tipped employees increases to $5.30 per hour.

  • The City of Chicago rate increases vary depending on the size of the employer:

    • For employers with four to 20 workers, the minimum wage increases to $13.50 per hour, while the base wage for tipped workers increases to $8.10 per hour.

    • For employers with 21 or more workers, the minimum wage increases to $14 per hour, while the base wage for tipped workers increases to $8.40 per hour.

    • A tipped worker's wages plus tips need to equal at least the full minimum wage, or else the employer must make up the difference.

July 1 also ushers in Chicago's Fair Workweek Ordinance (the Ordinance) which takes effect after unsuccessful efforts to delay implementation in light of the COVID-19 crisis. The Ordinance requires certain employers in the building services, health care, hotel, manufacturing, restaurant, retail, and warehouse services industries to, among other things, provide covered employees with their work schedules for each calendar week at least 10 days in advance of the start of that calendar week. (Starting July 1, 2022, this notice period increases to 14 days.)

To be a "covered employer" in one of the foregoing industries (each of which has its own definition), an employer must have at least 100 employees globally (250 employees if a nonprofit), at least 50 of whom are "covered employees" who earn $26 per hour or less (if paid hourly) or $50,000 annually or less (if paid on a salaried basis), and are primarily engaged in the above-listed industries. Restaurants receive some relief and are a covered employer under the Ordinance only if they globally have at least 30 locations and 250 employees in the aggregate, and certain small, local franchises of larger chains are also exempted.

Once a workweek schedule is provided to employees, the Ordinance limits how an employer can change the schedule without incurring monetary penalties, which primarily take the form of requiring the employer to pay additional wages to the employees who have their schedules affected. Aside from the scheduling requirements and penalties, the Ordinance also requires employers to fill vacant shifts by offering open shifts to employees in a certain order. And, notably, because exempt employees can be a covered employee under the Ordinance, the Ordinance will require employers to give schedules to employees who may not normally work under a set work schedule.

In response to COVID-19, the City of Chicago did provide limited relief to employers subject to the Ordinance. If the current pandemic causes an employer to materially change its operating hours or plans, or its goods or services, then an employer may change the schedule for the week in question and the immediately following week without penalty.

A copy of the Ordinance's required poster can be found online.

© 2020 Much Shelist, P.C.National Law Review, Volume X, Number 183


About this Author

Matthew J. Feery, Much Shellist, Workplace termination lawyer, restrictive covenants attorney

Matthew J. Feery helps employers of all sizes develop best practices, strategies and solutions to promote compliance with federal, state and local labor and employment laws while also supporting business goals.

Matt regularly advises on matters involving hiring and termination, restrictive covenants, wage and hour requirements, discrimination and harassment, medical leaves and related issues, including matters arising under discrimination laws (such as Title VII and the ADA), wage and hour laws (including the Fair Labor Standards Act (FLSA), the...

Laura A. Elkayam Employment Lawyer Much Law Firm

Laura helps employers implement best practices to promote compliance with federal, state, and local labor and employment laws, while remaining mindful of each company’s unique business strategies and objectives.

Laura advises employers on matters pertaining to nearly every aspect of the employment relationship, including hiring, termination, leaves of absence, and wage and hour issues. She counsels clients on compliance with a variety of employment laws, including Title VII, the Americans with Disabilities Act (ADA), the Age Discrimination in Employment Act (ADEA) and the Family and Medical Leave Act (FMLA). Laura also drafts and revises employee handbooks and drafts and negotiates employment agreements, separation agreements, and restrictive covenants.