2025 Illinois Labor & Employment Year End Review

Chicago, Ill. (December 30, 2025) - 2025 brought significant changes for Illinois employers, driven by new legislation and regulatory updates that will soon be in effect or were recently implemented. These developments will have a substantial impact on workplace policies and practices. To stay compliant and mitigate risk, employers should be aware of the following key changes:

Amendments to Illinois Human Rights Act

Effective January 1, 2026, SB2487 amends the Illinois Human Rights Act (IHRA) to make fact-finding conferences for open charges of discrimination discretionary rather than mandatory. Parties, however, may still request a fact-finding conference if the request is made jointly in writing for a conference within 90 days of the charge being filed. The amendment also provides for civil penalties per violation "to vindicate the public interest." These include penalties up to $16,000 for a first violation; up to $42,500 if the respondent had one prior violation within the last five years; and up to $70,000 if the respondent had two or more prior violations within the last seven years. Importantly, if the acts constituting a civil rights violation are committed by the same natural person who was previously adjudged to have violated the Illinois Human Rights Act, then the higher civil penalties may be imposed without regard to the time elapsed between the prior and subsequent violations. The amendment applies to charges pending or filed on or after the effective date of the amendatory Act.

Also effective January 1, 2026, HB3773 amends the IHRA to regulate the use of artificial intelligence (AI) and predictive data analytics in employment decisions. Employers may not consider an applicant's race or use zip code as a proxy for race when rejecting an applicant in contexts such as recruiting, hiring, promotion, renewal of employment, training or apprenticeship selection, discharge, discipline, tenure, or any terms and conditions of employment. Employers using AI must disclose to employees when they are using AI for the reasons outlined above.

Nursing Mothers in the Workplace Act

Effective January 1, 2026, SB212 amends the Illinois Nursing Mothers in the Workplace Act to clarify that employers must provide paid "reasonable" break time for employees to express breast milk for one year after childbirth, unless doing so would cause an "undue hardship" as defined by the Illinois Human Rights Act. The break time must be compensated for at the employees' regular rate of pay, and employees cannot require the use of paid leave or reduce pay in any other form during this break time.

Amendment the Workplace Transparency Act

Effective January 1, 2026, HB3638 amends the Workplace Transparency Act to strengthen employee rights regarding work-related issues. It prohibits any contract, agreement, clause, covenant, waiver, or similar document from restricting an employee, prospective employee, or former employee from engaging in concerted activities to address workplace concerns. Agreements that are mutual conditions of employment may include provisions otherwise contrary to public policy only if they expressly acknowledge the employee's right to engage in such concerted activities. The Act further permits valid settlement or termination agreements to include confidentiality provisions related to alleged unlawful employment practices, provided those provisions expire no later than five years after the alleged conduct. Additionally, employees may recover consequential damages incurred in challenging a contract that violates the Act.

Amendment to the Illinois Blood and Organ Donation Leave Act

Effective January 1, 2026, HB1616 amends the Illinois Blood and Organ Donation Leave Act to expand eligibility and clarify compensation for part-time employees. It provides that a participating employee or part-time employee may use up to ten days of leave in any 12-month period to serve as an organ donor. For part-time employees, the employer must calculate the daily average pay earned during the previous two months of employment and compensate the employee at that rate for each leave day used.

Amendment to the Illinois Victims' Economic and Safety Act (VESSA)

Effective January 1, 2026, HB1278 amends VESSA to require all covered employers to allow employees, or their family or household members who are victims or alleged victims of domestic violence, sexual violence, gender violence, or any other crime of violence, to use employer-provided electronic devices for personal purposes to document or communicate incidents of such violence. Employers must also grant these individuals access to photographs, voice or video recordings, sound recordings, or other digital documents stored on employer-issued devices whenever needed in a criminal action or proceeding to support allegations of violence. If an employee is seriously injured or incapacitated, the employer must provide this access to a family or household member whose interests are not adverse to the employee. Additionally, employers are required to post a notice, prepared or approved by the Director of Labor, in conspicuous workplace locations explaining these provisions.

Amendment to the Transportation Benefits Program Act

Effective January 1, 2026, HB3094 amends the Transportation Benefits Program Act to expand eligibility for pre-tax commuter benefits to include part-time employees. However, construction workers covered by a collective bargaining agreement are excluded from this benefit. The law applies only to "covered employers," defined as entities with at least 50 employees at a location within one mile of fixed-route transit service.

Amendment to the Digital Voice and Likeness Protection Act

Effective January 1, 2026, HB3178 amends the Digital Voice and Likeness Protection Act, noting that any provision in a personal or professional services agreement that permits the creation and use of a digital replica of an individual in place of work the individual would have performed in person will be unenforceable if it lacks a reasonably specific description of the intended uses and the individual was not represented by legal counsel or a labor union with a collective bargaining agreement expressly covering digital replica usage. The law clarifies that failure to include a specific description will not render a provision unenforceable when the uses are consistent with the contract terms and the fundamental character of the original photography or soundtrack as recorded or performed.

Family Neonatal Intensive Care Leave Act

Effective June 1, 2026, HB2978 establishes unpaid leave entitlements for employees whose child is admitted to a neonatal intensive care unit (NICU). Employees of employers with 16 to 50 employees are entitled to up to ten days of unpaid NICU leave, while employees of employers with 51 or more employees may take up to 20 days of unpaid NICU leave. Leave may be taken continuously or intermittently, with a minimum increment of two hours for intermittent leave. Employees who qualify for leave under the Family and Medical Leave Act (FMLA) must first exhaust their FMLA entitlement before using NICU leave. Employers may request reasonable verification of the child's NICU stay but cannot require confidential medical details. Upon returning from leave, employees must be reinstated to their former position or a substantially equivalent role without loss of benefits accrued prior to the leave.

Military Leave Act (formerly, the Family Military Leave Act)

Effective August 1, 2025, SB220 required Illinois employers with at least 51 employees to provide up to eight hours of paid leave per month, or 40 hours per year, to eligible employees who participate in military funeral honors details. In order to qualify, employees must be trained to serve in a funeral honors detail and either (1) be an active or retired member of the U.S. Armed Forces or reserve components, including the Illinois National Guard, or (2) be an authorized provider or a registered member of a nonprofit or other organization that is an authorized provider, including a member of a veterans service organization. Qualified employees must give reasonable notice to the employer, and the employer is allowed to request confirmation of participation from the applicable veteran service organization or other official notice. Importantly, an employee that takes leave under this section may do so in lieu of, and without having exhausted, his/her vacation, personal, compensatory or any other leave that may be granted to the employee, including sick and disability leave. Employers must pay the participating employee at his/her regular rate of pay during such leave; however, employers may deny requests for military funeral honors leave if granting the leave would reduce staffing below safe or legally required levels in sensitive environments, such as nursing homes or 24/7 care facilities, except where a collective bargaining agreement provides otherwise.

Amendments to the Illinois Wage Payment and Collection Act

Effective August 1, 2025, SB2164 significantly updated the Illinois Wage Payment and Collection Act. The legislation expands the Illinois Department of Labor's (IDOL) enforcement powers, increases penalties for wage violations, and strengthens employee protections. Under the Act, final administrative decisions requiring employers to pay wages, damages, fines, or fees automatically become debts to the State if unpaid within 35 days after judicial review or expiration of the review period. These debts may be collected through any legal remedy, and IDOL's findings and orders are enforceable like civil court judgments, eliminating the prior requirement for IDOL to file a separate petition. The Act also clarifies penalty accrual: the 5% monthly penalty continues until the final decision, and the 1% daily penalty accrues until IDOL's final order and decision of the IDOL becomes a debt due and owed to the state. Further, nonwaivable administrative fees have increased to a range of $500 to $1,250, up from $250 to $1,000, based on the amount owed. Newly enacted Section 20 provides that procedural changes apply retroactively, while substantive changes apply prospectively.

Workers' Rights and Worker Safety Act

Effective August 14, 2025, SB1976, known as the Illinois Workers' Rights and Worker Safety Act, established a regulatory floor ensuring that state labor and safety standards remain at least as protective as federal rules in place as of April 28, 2025. It prohibits state agencies, including the Illinois Department of Labor and Department of Natural Resources, from weakening state wage-and-hour or coal mine safety rules below the stringency of comparable federal statutes and regulations existing on that date. The Act further requires that if federal standards are later amended, revoked, or repealed in a manner that results in the federal protections of workers' rights or worker safety becoming less "stringent," IDOL must adopt and maintain the previous federal standard in Illinois to preserve baseline protections. The legislation explicitly preserves state authority to adopt more stringent worker protection measures. To ensure compliance with the requirements, state agencies must submit a report to the General Assembly, filed with Clerk of the House of Representatives and the secretary of the Senate in electronic form only.

Illinois Service Member Employment and Reemployment Rights Act (ISERRA)

Effective August 15, 2025, HB1362 updated the definition of "work days" under the ISERRA for calculating differential compensation owed to public employees. Under the revised language, "work days" now refer to the number of shifts the employee would have worked during military leave, rather than calendar days. It also eliminates the prior provision that counted shifts extending into the next calendar day as two separate work days. In addition, the amendment entitles public employees to full compensation during active service but caps the combined total of concurrent compensation at 30 days per calendar year.

Amendments to the Illinois Equal Pay Act

Effective June 30, 2025,HB2488 expands the scope of businesses subject to the Equal Pay Act and now applies to any private employer with 100 or more employees in Illinois, regardless of EEO-1 filing status. Further, job categories are no longer tied to the "major job categories" in the EEO-1. In addition, the act amends the Illinois Prevailing Wage Act to require that all contractors pay their apprentices "full journeyman annualized fringe benefits," regardless of the terms in the collective bargaining agreement (CBA) used to set the area prevailing wages or their own CBA.

Dignity in Pay Act

Governor JB Pritzker signed into law the Dignity in Pay Act, which stipulates that Illinois employers will be prohibited from paying their employees with disabilities less that state minimum wage by December 31, 2029.

Minimum Wage Increase

Effective July 1, 2025, the Chicago minimum hourly wage for employers with four or more employees increased to $16.60, and the tipped employee minimum hourly wage increased to $12.62. For youth workers under subsidized temporary youth employment programs and subsidized transitional employment programs, the minimum hourly wage will be $16.50.

For more information about these developments, contact the author or editor of this alert. Visit Lewis Brisbois' Labor & Employment Practice page for more information about our capabilities in this area.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.