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Illinois amends equal pay law

09/05/19

Author: ADP Admin/Tuesday, September 3, 2019/Categories: Compliance Corner , State Compliance Update, Illinois

Illinois has enacted legislation (House Bill 834) that will expand the state's equal pay law. House Bill 834 takes effect September 29, 2019.


Background:

Currently, the state's Equal Pay Act of 2003 prohibits employers with four or more employees from paying an employee less than another employee of the opposite sex. The law applies to workers in the same county who perform the same or substantially similar work on jobs that require equal skill, effort, and responsibility, and which are performed under similar working conditions.

There are exceptions to this general prohibition where the payment is made under a:

  • Seniority system;
  • Merit system;
  • System that measures earnings by quantity or quality of production; or
  • A differential based on any other factor other than sex or a factor that would constitute unlawful discrimination under the Illinois Human Rights Act.

In 2018, the state enacted legislation (House Bill 4743) that extended the same protections to African-American employees.


House Bill 834:

House Bill 834 amends the Equal Pay Act's definition of what constitutes pay discrimination. These amendments are underlined below.

Under the amended law, employers with four or more employees are prohibited from paying wages to an employee at a rate less than that of another employee of the opposite sex in the same county for the same or substantially similar work on jobs that require substantially similar (previously, the law stated "equal") skill, effort, and responsibility, and which are performed under similar working conditions.

Under the amended law, an exception applies when the payment is made under a:

  • Seniority system;
  • Merit system;
  • System that measures earnings by quantity or quality of production; or
  • A differential based on any other factor other than sex or a factor that would constitute unlawful discrimination under the Illinois Human Rights Act, provided that the factor:

Similar amendments were made to the pay-discrimination changes created by House Bill 4743.


Pay Transparency:

House Bill 834 also prohibits employers from requiring an employee to sign a contract or waiver that would prohibit the employee from disclosing information about their compensation and/or benefits. However, an employer may prohibit a human resources employee, a supervisor, or any other employee whose job responsibilities require or allow access to other employees' pay information from disclosing that information without prior written consent from the employee.


Pay History:

Employers are also prohibited from:

  • Screening applicants based on their current or prior pay history, including benefits, by requiring that it satisfy minimum or maximum criteria;
  • Requesting or requiring pay history as a condition of: being considered for employment; being interviewed; continuing to be considered for an offer of employment; or receiving an offer of employment or an offer of compensation;
  • Requesting or requiring that an applicant disclose pay history as a condition of employment;
  • Seeking an applicant's pay history, including benefits, from a current or former employer; and
  • Retaliating against an individual because they fail to comply with a pay history inquiry.

If an applicant voluntarily and without prompting discloses their current or prior pay history, including benefits, the employer may NOT consider or rely on the information in determining whether to offer a job, making a compensation offer, or determining future compensation and benefits.

Exceptions:

The above restrictions regarding pay history don't apply:

  • If the job applicant's pay history is a matter of public record under the Freedom of Information Act, or any other equivalent state or federal law, or is contained in a document completed by the job applicant's current or former employer and then made available to the public by the employer, or submitted or posted by the employer to comply with state or federal law; or
  • The job applicant is a current employee and is applying for a position with their current employer.

The law also states that the prohibitions shouldn't be construed to prevent an employer from:

  • Providing information about the compensation and benefits in relation to a position; or
  • Engaging in discussions with an applicant about the applicant's expectations with respect to compensation and benefits.


Compliance Recommendations:

Illinois employers should review application forms, policies, practices, and training to ensure compliance with House Bill 834.

Please contact your dedicated service professional with any questions.

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Tags: 09/05/19

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