As Illinois rolls out a range of new employment laws between 2024 and 2026, it's crucial for businesses and HR professionals to stay ahead of these legislative changes. From AI in hiring to expanded family leave protections, these updates will impact how employers manage their workforce, enforce policies, and engage with employees.

Below are some of the most significant legal changes employers in Illinois need to be aware of to ensure compliance and foster a fair and inclusive workplace.

1. Artificial Intelligence in Employment Decisions

Effective 1/1/2026

The Illinois Human Rights Act (IHRA) is being amended to place strict limitations on the use of artificial intelligence in employment decisions. This includes AI in recruiting, hiring, promotions, terminations, and other employment-related decisions. Under these changes, AI cannot have a discriminatory effect on employees or applicants based on a protected class, such as race, gender, or age.

Employers are also prohibited from using certain biographical information, such as a zip code, as a proxy for a protected class. Additionally, employers will be required to disclose when AI is used in any hiring or employment-related decisions.

What Employers Need to Do:

• Review and audit AI tools to ensure compliance.

• Ensure transparency with employees and applicants about the use of AI in decision-making processes.

2. Protections Against Retaliation for Refusing to Attend Captive Audience Meetings

Effective 1/1/2025

Illinois employers will no longer be able to take adverse action against employees who refuse to attend employer-sponsored "captive audience" meetings. These meetings are often used to communicate the employer's political positions, union stance, or other workplace matters. This law gives employees the right to make their own decisions about political beliefs and union membership without fear of retaliation.

What Employers Need to Do:

• Update workplace policies to reflect this change.

• Ensure that employees are aware of their rights to refuse participation in such meetings.

3. Expanded Pay Statement Requirements

Effective 1/1/2025

Illinois employers will be required to provide more detailed pay statements for employees. These statements must include information about the total hours worked (including overtime), rate(s) of pay, gross wages, and any deductions made. Employers must also track and report yearly totals of wages and deductions to ensure clarity for employees.

What Employers Need to Do:

• Revise pay statements to meet the new requirements.

• Review payroll systems and ensure proper recordkeeping practices are in place.

4. Protections for Reproductive Health and Family Responsibilities

Effective 1/1/2025

The Illinois Human Rights Act will be amended to protect employees from discrimination based on reproductive health decisions and family caregiving responsibilities. Employers will no longer be able to discriminate against employees for their choices related to contraception, fertility, pregnancy care, family planning, or family caregiving.

Family caregiving is now considered a protected class, meaning that employees who provide personal care to family members are also protected from discrimination.

What Employers Need to Do:

• Update anti-discrimination policies to include reproductive health and family caregiving as protected classes.

• Provide training to managers and HR staff on the new protections.

5. Extended Statute of Limitations for Discrimination Claims

Effective 1/1/2025

The statute of limitations for filing discrimination claims under the Illinois Human Rights Act will be extended from 300 days to two years. In addition, civil penalties for violations will be increased, and restitution for injuries caused by discriminatory actions will be allowed.

What Employers Need to Do:

• Update internal complaint procedures to reflect the new statute of limitations.

• Train HR personnel to handle discrimination claims promptly and effectively.

6. Paid Leave for All Workers

Effective 1/1/2024

The Illinois Paid Leave for All Workers Act mandates that employers provide employees with up to 40 hours of paid leave annually for any reason. This law aims to provide more flexibility for employees in managing personal and family matters without fear of losing income.

What Employers Need to Do:

• Revise employee handbooks to include this paid leave provision.

• Update payroll systems to track paid leave usage and ensure compliance with the new law.

7. New Hire Reporting and Workers' Compensation Compliance

Effective 1/1/2024

Employers are now required to report newly hired independent contractors to the state, along with any changes in employment status. Additionally, employers must comply with strict workers' compensation insurance requirements. Failure to do so may result in penalties, including the revocation or suspension of business licenses.

What Employers Need to Do:

• Ensure that independent contractors are reported to the state as required.

• Verify that workers' compensation insurance is up to date for all employees and contractors.

8. New Protections for Freelance Workers

Effective 7/1/2024

The Freelance Worker Protection Act will require employers to ensure timely payment for freelance work, maintain written contracts, and prohibit retaliation against freelancers. These new protections are designed to support the growing gig economy and provide freelance workers with more security.

What Employers Need to Do:

• Implement written contracts for all freelance work.

• Ensure payment for services is timely, and communicate clearly with freelancers regarding their compensation.

9. Telework Notification Requirements

Effective 1/1/2024

Employers with remote or teleworking employees are now required to provide mandatory notices and workplace posters to employees via email or by posting them on the company's intranet. This ensures that remote workers are aware of their rights and responsibilities.

What Employers Need to Do:

• Make sure teleworkers receive the necessary notices electronically.

• Post required materials on your company's intranet or website.

Conclusion: What HR Professionals Need to Know

With these new Illinois employment laws taking effect, businesses must act quickly to revise policies, update employee handbooks, and train HR staff to ensure compliance. Regular consultations with legal experts and ensuring open communication with employees about their rights will help mitigate any risks associated with non-compliance.

By proactively addressing these changes, businesses can foster a more compliant, transparent, and fair workplace for all employees.