Effective December 31, 2023, the Chicago Paid Leave and Paid Sick and Safe Leave ordinance will replace the existing Paid Sick Leave ordinance. Under the new ordinance, employees accrue one hour of paid sick leave plus one hour of general paid leave for every 35 hours worked, with a cap of 40 hours for each type of leave annually. Employees can carry over up to 16 hours of general paid leave and 80 hours of sick leave to the next year. Alternatively, employers have the option to front-load both types of leave at the start of each benefit year, which exempts them from the rollover requirement for general paid leave, but not for sick leave. New employees can use paid sick leave after 30 days and paid leave after 90 days of employment, and may opt to use this leave before any other provided by the employer unless mandated otherwise by law.

As with the statewide Paid Leave for All Workers Act effective January 1, 2024, employees are allowed paid leave for any purpose without requiring employees to disclose the reason. However, reasons for paid sick leave have not been changed from those under the previous ordinance. A notable change is the requirement to pay out accrued, unused leave upon termination of employment or when employees no longer fall under the ordinance’s scope, with the application of this requirement, which varies based on employer size. However, any banked leave exceeding annual carryover limits is forfeited at year-end.

The ordinance also creates several notification and posting obligations. Employers are required to inform employees in writing about their paid-time-off policy upon hire and five days prior to any policy changes, and any changes impacting final compensation for leave require a 14-day notice. Additionally, individualized details about leave accrual and usage must be shared each pay period. Finally, employers must provide written notice of employees’ rights under the ordinance with their first paycheck and annually in July.

The Department of Business Affairs and Consumer Protection oversees the enforcement of this law, which may also be enforced by plaintiff’s counsel in a private action. Employers with employees in Chicago should review their leave policies to ensure compliance with this new ordinance and reach out to Stokes Wagner attorneys with any questions or concerns.

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THIS DOCUMENT PROVIDES A GENERAL SUMMARY AND IS FOR INFORMATIONAL/EDUCATIONAL PURPOSES ONLY. IT IS NOT INTENDED TO BE COMPREHENSIVE, NOR DOES IT CONSTITUTE LEGAL ADVICE. PLEASE CONSULT WITH COUNSEL BEFORE TAKING OR REFRAINING FROM TAKING ANY ACTION.