Several new and updated laws take effect in Cook County and Chicago on July 1, 2024. Keep reading for more details.

LOCAL MINIMUM WAGE INCREASES

Chicago
For employers with four or more employees, the minimum hourly wage will increase to $16.20. The minimum hourly base wage for tipped employees will increase to $11.02—this is the first rate increase that’s part of the gradual phase out of the tip credit, which will be eliminated in 2028.

Cook County
The minimum hourly wage will increase to $14.05. The minimum hourly base wage for tipped employees will remain at $8.40.

CHICAGO FAIR WORKWEEK THRESHOLD INCREASE
The threshold for coverage under the Fair Workweek Ordinance will increase to $61,149.35 per year (if salaried) or $31.85 per hour (if paid hourly).

CHICAGO PAID LEAVE AND PAID SICK AND SAFE LEAVE
Under the city’s new Paid Leave and Paid Sick and Safe Leave Ordinance, which applies to employers of all sizes, employees will be entitled to accrue two separate types of leave: Paid Leave (PL) that can be used for any reason and Paid Sick and Safe Leave (PSL) that can be used for the reasons allowed by Chicago’s previous paid sick leave law. Below are some highlights.

Accrual
Both types of leave begin to accrue on July 1, 2024 (or upon hire, if after that) at a rate of one hour for every 35 hours worked in Chicago. An employee who works 35 hours will have earned one hour of PL and one hour of PSL. Employers can cap annual accrual at 40 hours for each type of leave.

Carryover
Employees can carry over up to 16 hours of PL from one benefit year to the next unless their employer frontloads PL, in which case no PL needs to carry over. Employees can carry over up to 80 hours of PSL from one benefit year to the next, regardless of whether the employer frontloads.

Use
Employers can’t cap use of either type of leave (except up to the amount that an employee has accrued). Employers can deny PL requests if the denial is based on a rationale covered by their written policy—they must also provide employees with a written explanation for the denial. Employers can impose a 30-day waiting period on use of PSL and a 90-day waiting period on use of PL from the time an employee begins to accrue.

Payout at Termination
Employers don’t have to pay out any unused PSL but may need to pay out accrued but unused PL at termination, according to the following rules:

Employers with 1–50 employees are exempt from PL payout
Employers with 51–100 employees must pay out up to 16 hours of PL through June 30, 2025, and all unused, accrued PL after that date
Employers with 101 or more employees must pay out all unused, accrued PL
Notice to Employees
Employees need to be given a notice about PL and PSL with their first applicable paycheck—in July 2024, or after hire, whichever comes first—and annually thereafter in July. The notice also needs to be posted in the workplace. The notice, made by the city, is available in six languages.

Employers also need to give employees written notification of their available PL and PSL, and their accrual rate, each time they’re paid. Employers can meet this obligation in several ways, including by putting the information on a paystub or having it available online where employees can easily access it.

Documentation for Use of Leave
Employers can’t require any documentation for use of PL. Employers can require that employees provide certification of their need for PSL if they’re gone for more than three consecutive scheduled workdays. Note that the FAQs are a bit misleading in saying that an employer can ask for a note “after” an employee uses three days in a row—that’s only true if the employee also uses PSL for all or part of a fourth scheduled workday in a row.

Action Items
Create or update your Paid Leave and Paid Sick Leave policy to comply with the ordinance.