Locke Lord QuickStudy: ‎“Show Me the Money!” Illinois Passes ‎Pay Transparency ‎Legislation

Locke Lord LLP
May 22, 2023

On May 17, 2023, the Illinois legislature passed a bill to amend the Equal Pay Act of 2003 to impose new pay transparency requirements on certain employers. This amendment would require employers with 15 or more employees to include pay scale and benefits information in each job posting they issue (either directly in the posting or via a link to a publically-accessible page) if the underlying position will be physically performed, at least in part, in Illinois or will report to a supervisor, office, or other work site in Illinois. If an employer subject to this amendment engages a third party to share a job posting, the employer must provide the pay scale and benefits information to that third party, which, in turn, is responsible for making it available as part of its posting.

Beyond including pay scale and benefits information in job postings, this amendment would also require employers to “announce, post, or otherwise make known” any promotional opportunities for current employees within 14 days of issuing an external job posting for the underlying position. Additionally, when no job posting is issued, an employer must disclose the pay scale and benefits information upon request by an applicant for the position in question. Furthermore, retaliation against individuals for exercising their rights under the amendment is prohibited.

If the amendment becomes law, it may expose employers to investigation by the Illinois Department of Labor which could result in penalties. If the Department determines that a violation of these transparency requirements has occurred, then—depending on how many times the employer previously committed violations and whether the underlying job posting is still active when the Department issues its findings —penalties of up to $10,000 per offense may be assessed. Whether the employer would be allowed to cure a deficient posting instead of paying the penalty also depends on whether it has previously violated these transparency obligations.

This legislation has not yet been signed by Governor Pritzker; however, it appears likely that he will do so. If these new transparency requirements are signed into law, they will not become effective until January 1, 2025 and would only apply to job postings issued on or after that date.