General Assembly Tells Illinois Employers to “Show Me the Money!”
On August 11, 2023, Illinois Governor J.B. Pritzker signed HB 3129, a new pay transparency bill, into law. This bill is one of several other recent amendments to the Illinois Equal Pay Act, an Illinois law that, among other things, prohibits employers from paying employees unequal wages based on sex or race for doing the same or substantially similar work. With HB 3129 set to take effect on January 1, 2025, Illinois joins a growing minority of U.S. states that have enacted similar pay transparency laws over the past few years, including California, Colorado, Connecticut, New York, and Washington.
What does Illinois’ pay transparency law require?
As previously reported, HB 3129 will require employers with 15 or more employees to include the pay scale and benefits of a position on job postings. The law applies to positions that will be either (1) physically performed, at least in part, in Illinois or (2) will be physically performed outside of Illinois, but the employee reports to a supervisor, office, or other worksite in Illinois.
Employers who fail to include this information in a job posting can incur a graduated series of fines depending on the number of violations (up to $500 for the first offense and up to $2,500 for the second offense). A single non-compliant job posting constitutes one violation of the law, regardless of the number of duplicative job postings that list that open position. Fortunately, the law allows for a “cure period” for the employer to correct a job posting that is missing this information. The law allows 14 days to remedy a first offense violation and seven days to remedy a second offense. For the third offense, there is no cure period, and employers could face up to a $10,000 fine.
If an employer uses a third-party (i.e., LinkedIn or Indeed) to handle its job postings, the employer must provide the pay scale and benefits, or a hyperlink to both, to the third-party. That third-party can be also liable for failure to include the pay scale and benefits in the posting, unless it can show that the employer failed to provide it the necessary information regarding the applicable pay scale and benefits.
Do employers have to record the wages and benefits for each posting?
Yes. While the Equal Pay Act already requires employers to keep records of the name, address, and occupation of each employee, HB 3129 additionally requires employers to maintain records of the pay scale, benefits, and the job posting for each position for at least a five-year period.
What should employers do?
Employers should ensure that all job postings that go live on or after January 1, 2025, include the pay scale and benefits for that job. The “pay scale” requirement can be satisfied by including a hyperlink to a publicly viewable webpage. As for the “benefits” requirement, posting an up-to-date general benefits description at an easily accessible, central, and public location on the employer’s website that refers to that specific job in the posting is sufficient. If using a third-party job posting site, employers must ensure that it gives the third-party the pay scale and benefits information (or a hyperlink to both).
The good news is that the law does not apply to postings made before the law’s January 1, 2025, effective date, and employers still have over a year to modify or develop a compliant job posting process.
