On Wednesday, December 13, Barbara Gressel, Deputy Commissioner, Department of Business Affairs and Consumer Protection (BACP) provided the Chicago Bar Association’s Labor & Employment Committee with an informative presentation about the City of Chicago’s Paid Sick Leave Ordinance (in effect since July 1, 2017).

Ms. Gressel, who leads the Department’s compliance and enforcement efforts, reviewed the Ordinance’s accrual and carry over rules, as well as the provisions concerning usage caps. The remainder of her presentation involved how the Department will investigate charges, and the administrative process for formally enforcing the ordinance. Here are our takeaways:

Department Investigations Initiated by Employee Complaint

  • Enforcement begins with the filing of a complaint by an employee. Employees may obtain a copy of a blank complaint by visiting the Department’s webpage. The charge must be filled out by hand, or on a typewriter. The complete complaint can be filed by facsimile (fax) or in person.
  • The Department intends to investigate each facially valid complaint on a class-wide basis. It reasons that if one employee is not receiving proper payment, accrual, carryover etc., no employee is. The request for information will be by administrative subpoena.
  • At least initially, the Department intends to attempt to resolve complaints informally. Employers who refuse to meet their obligations during this initial period will be prosecuted for a ordinance violation. Similarly, after the initial familiarization period (expected to last 18-24 months), the Department will use its formal ordinance enforcement process whenever it determines to allege a violation has occurred.

Administrative Process of Ordinance Enforcement

  • The process begins when the Department issues a ordinance violation citation (similar to a parking ticket). Currently there is no process for employers to mail in the fine.
  • Consequently, employers will be required to appear before the Division of Administrative Hearing Officers. This Division is staffed by private attorneys with at least three years’ of experience. They are independent contractors rather than City of Chicago employees.
  • By rule, corporations must appear before the Hearing Officer through an attorney. The Administrative Hearing Officer will take evidence, issue a ruling, and impose a fine.

What Constitutes a Violation

Ms. Gressel clarified the Department’s position as to the definition of a violation. It is the Department’s position that each day a violation occurs constitutes a separate violation warranting a separate fine. The fines under the ordinance are $500 to $1000 per violation.

The Ordinance allows the City to revoke an offending employer’s business license. Ms. Gressel assured the attendees that the Hearing Officer cannot revoke an employer’s business license. Rather the license revocation occurs in a separate proceeding conducted by the City of Chicago Licensing Department.

Record-Keeping Requirements

Notably, the City has determined a employer must maintain records showing twelve discrete types of information for each employee for five (5) years. The twelve discrete types of information are:

  1. Name of each Covered Employee (CE);
  2. Address of each CE;
  3. Occupation of each CE;
  4. Social Security number of each CE;
  5. Hire Date of each CE;
  6. Date each CE was eligible to use Paid Sick Leave (PSL);
  7. Date and number of hours each CE used PSL;
  8. Rates of pay of each CE;
  9. Hours worked each day & each workweek by each CE;
  10. Type of payment & total wages paid to each CE in each period:
  11. Additions & deductions to each CE’s wages & explanation;
  12. Dates of payment of each pay period.

Employers should anticipate the Department will subpoena all of these records for each of its employees (including the CEO) in the event a charge is filed.

The Bottom Line

To avoid charges, we recommend employers adopt a compliant Paid Sick Leave Policy. In the absence of a written policy establishing a benefit year, each employee has a unique benefit year based on the employee’s respective date of employment. In order to simplify the administration of the Paid Sick Leave accrual, carry over and caps on use employers should adopt a corporate-wide benefit year beginning on a fixed date e.g. July 1 or January 1.

The video of Barbara Gressel’s presentation can be accessed by visiting the Chicago Bar Association site HERE.