On June 22, 2016, the Chicago City Council passed an amendment to the City of Chicago Minimum Wage Ordinance (Ord. 2016-2678) (“the Ordinance”), which requires all Chicago employers to allow most employees to accrue up to five days of paid sick leave annually. The Ordinance amendment, which passed unanimously in the City Council and is anticipated to be signed shortly by Mayor Rahm Emanuel, will go into effect on July 1, 2017. It allows employees who allege violations to pursue civil court actions against employers to recover the value of up to three times the amount of unpaid sick time denied or lost, plus interest and attorneys’ fees and costs.

Under the new Ordinance, all employers who operate within the Chicago city limits or that are subject to City of Chicago licensing requirements are required to allow all employees who have worked 80 hours or more in any 120-day period to accrue paid sick leave at a rate of one hour per 40 hours worked. Employers may grant the equivalent lump sum at the beginning of each accrual year and also may use paid time off (“PTO”) policies that meet the amount and manner of accrual requirements to satisfy the Ordinance. Payout upon termination of any remaining hours is not required under the Ordinance.

The Ordinance allows employees to use paid sick leave time earned for medical treatment or diagnosis for the employee or the employee’s child, parent, spouse, domestic partner, sibling, grandparent, grandchild or other close relative; for matters related to domestic violence or sexual assault; or for public health emergency closures. Employers must allow employees to begin using time beginning no later than the employee’s first 180 days of work and to carry over at least 20 hours, with additional requirements for time used exclusively for reasons covered under the Family and Medical Leave Act. Employers may ask employees to provide seven days’ advanced notice, if the absence is reasonably foreseeable, and may require employees to provide a certification or documentation of the need for leave of three or more consecutive days. Employers will be required to display a poster notifying employees of their rights under the Ordinance.

Chicago joins a growing number of states and municipalities that have passed paid sick leave laws, and similar legislation remains pending in the Illinois legislature. Altogether, 25 municipalities and five states have passed paid sick leave laws, which are lauded by working families and women advocacy and fair employment groups as necessary to protect both employees and customers. While similar, the prohibitions under each state or municipality statute or regulation are different, with most having different accrual and manner of use requirements and some that are limited to specific employers or industries. Employers should review their time off policies under each relevant jurisdiction in which they operate for compliance with applicable laws.

From a practical perspective, Chicago employers should consider taking this opportunity to review their PTO policies and practices to ensure compliance with the Ordinance. Employers that operate in Illinois, but outside of Chicago, should also anticipate potential future state legislation with similar requirements.