Last week, the Chicago City Council passed the Chicago Fair Workweek Ordinance (“the Ordinance”), which requires employers to give workers early notice of their schedules or face penalties if they change shifts without sufficient notice. For employers, this may present an administrative challenge, but employers should be prepared to address this national trend. New York City, Philadelphia, Seattle, San Francisco, Oregon, and the District of Columbia have already enacted laws to protect worker schedules and limit employer discretion in adjusting employee schedules. Mayor Lightfoot is expected to formally sign the bill and it will subsequently be effective July 1, 2020. The highlights follow:

Who’s Covered?

  • The Ordinance requires employers in any “Covered Industry,” which includes building services, healthcare, hotels, manufacturing, retail, or warehouse services with more than 100 employees globally (250 in the case of non-profits) with at least 50 covered employees, to provide certain protection around the scheduling of an employee’s shifts.
  • For restaurants, the law is applicable for businesses with 30 locations globally and at least 250 employees.
  • The Ordinance applies to all employees, within Covered Industries, who make less than $26 per hour or receive an annual salary of under $50,000.

Predictability Pay

  • Employers must provide a 10-day, advance notice requirement (growing to 14 days on July 1, 2022) for all covered employee shifts. The written employee schedule must include both scheduled shifts and any on-call status. Employers who make changes to employee schedules after the deadline must pay additional compensation, referred to as Predictability Pay, or permit employees to decline a new shift requirement.
  • If an employer changes the employee’s schedule after the notice deadline with more than 24 hours’ notice, employees are entitled to an extra hour of Predictability Pay at their regular hourly rate.
  • If an employer reduces or cancels an employee’s shift after the notice deadline with less than 24 hours’ notice, the employee is entitled to 50% of the regular rate of pay for the time they were otherwise scheduled to work.
  • Employees can decline any shift that starts less than 10 hours after the end of the previous day’s shift and demand a pay premium of 1.25 times the regular rate for work performed on such shifts.

Exceptions

  • Like most laws, there are numerous exceptions, including when employees self-schedule, circumstances outside the employer’s control (i.e. weather, threats of violence, etc.), written, mutually agreed shift changes, employee requests for time off, shift trades between employees, specific industries (i.e. healthcare), and employers with collective bargaining agreements in place.

Pre-Employment Rules

  • The Ordinance also establishes a pre-employment requirement for employers to communicate their expectations including a good faith estimate, in writing, of the projected days and hours of work, including average number of work hours per week, days and shifts the employee will be expected to work, the employee’s “days off”, as well as any on-call expectations.

Filling Additional Shifts

  • Additionally, the Ordinance also creates rules around filling additional shifts of work, including a requirement to offer existing employees those opportunities first (with a preference for part-time employees when possible).
  • The requirement does not mandate an employer to provide this preference in a way that would make it subject to overtime pay premiums.

Enforcement

  • The Ordinance creates a specific right for employees to request modifications to their work schedule and creates an affirmative duty for employers to respond to such requests in writing.
  • The Ordinance creates a private right of action for employees. Further, employers who violate the Ordinance will be subject to penalties of $300 – $500 per offense.

Recommendations

As Chicago employers prepare to comply with the Ordinance, here are a few items to consider:

  1. Determine if your business is covered under the Ordinance;
  2. Implement policies and procedures for scheduling practices to ensure compliance;
  3. Train managers and other personnel responsible for employees’ schedules about the new requirements;
  4. Update employee handbooks to reflect new policies and procedures;
  5. Document pre-employment expectations in writing through an offer letter or another written document; and
  6. Monitor future administrative guidance from the City of Chicago.
  7. Seek legal guidance is the application of the Ordinance and its requirements to your business is unclear.