Illinois Contemplates Paid Family Leave Insurance Program

What You Need To Know:

• The Illinois House recently introduced legislation that would create a statewide paid family leave insurance program.
• The legislation would provide eligible Illinois employees with up to 12 weeks of leave in a 24-month period, to be used for time off needed due to family and medical reasons, including pregnancy, an employee’s own health condition, to bond with a child, or to care for a family member.
• The program would be administered through IDES, and funded through employee payroll contributions.

As the new year unfolds, the Illinois Legislature is considering additional ways to provide employees with paid time off benefits. Days after passing the Paid Leave for All Workers Act,  the House introduced Illinois House Bill 1102 – to implement a statewide family leave insurance program through the Illinois Department of Employment Security (“IDES”).

Eligible employees could take up to 12 weeks of family leave within a 24-month period for (1) pregnancy; (2) to be with a newborn child, a newly adopted or newly placed foster child; (3) for adoption; (4) to care for a family member with a serious health condition; (5) for an employee’s own serious health condition; or (6) certain military exigencies. Employees could receive 85% of their average wage, up to $881 in weekly compensation. The Bill would take effect immediately upon becoming law.

The Bill’s key provisions are as follows:

• Employee Eligibility: Individuals working in Illinois (other than those working for the State) employed by the same employer for 12 months or more, who have worked 1,200 or more hours during the preceding 12-month period would come under the Bill’s protections.
• Employer Coverage: Employers are defined broadly as any partnership, association, trust, estate, joint-stock company, insurance company, or corporation that has at least one employee performing services in Illinois, and any employer subject to the Unemployment Insurance Act.
• Duration of Leave: Up to twelve weeks of family leave within any 24-month period would be granted to eligible employees. Family leave could be taken on an intermittent basis for the qualifying conditions, except leave following birth or adoption would need to be for a continuous period of time unless agreed upon by the employer. Family leave would run concurrently with any FMLA leave. Employers can also require family leave to be taken concurrently with other employer leave policies, upon notice to employees.
• Notice: If an employee’s need for family leave is foreseeable, they would need to provide the employer with at least 30 days’ advance notice. Otherwise, notice would need to be given as soon as practicable. Employees would also be charged with making reasonable efforts to schedule foreseeable treatments so as to not unduly disrupt business operations.
• Leave Benefits: Eligible employees shall receive 85% of their average weekly wage, with a maximum of $881 in compensation per week. The Bill incorporates by reference the Unemployment Insurance Act’s determination of average weekly wage.
• State Benefits Fund: To cover the cost of the IDES-administered leave insurance, employers would be required to retain a payroll premium reduction of 0.5% from all employees, to be channeled into a newly created State Benefits Fund. Housed in the State Treasury, the Benefits Fund would be used for payment of leave benefits, and for administration of the Act.
• Collective Bargaining Agreements: If passed, the Bill would not affect any collective bargaining agreements in effect. The Bill states that its benefits cannot be diminished by a collective bargaining agreement entered into after the Bill’s effective date. But, it also states that, after the Bill becomes effective, its requirements could be waived in a collective bargaining agreement if done so in explicit terms. Hopefully this inconsistency is resolved through the legislative process prior to any enactment and exactly how the Act would address collective bargaining agreements remains to be seen.
• Reinstatement and Anti-Retaliation: Employees who receive leave benefits through the State would be entitled to return to their position of employment held prior to taking leave, or return to an equivalent position with equal benefits, pay, and terms and conditions of employment. The Bill prohibits employers from taking adverse action against an individual who filed or expressed an intent to file a claim for leave insurance through IDES.
• Exclusions: Insured family leave under the Bill excludes any time an eligible employee is paid under the Unemployment Insurance Act or Workers’ Compensation Act.

The Bill was referred to the House Rules Committee on January 12, 2023, and we will continue monitoring the political and legal landscape of this legislation for developments.

Amid navigating dynamic paid leave requirements and responsibilities, employers should reach out to their Seyfarth contact for solutions and recommendations on addressing compliance. To stay up-to-date on Paid Leave developments, click here to sign up for Seyfarth’s Paid Leave mailing list. Companies interested in Seyfarth’s paid family leave or paid sick leave surveys should reach out to sickleave@seyfarth.com.