04/23/2026
ILLINOIS EMPLOYMENT LAW CHANGES
By Ehrmann Gehlbach Badger & Considine, LLC
The Illinois General Assembly has passed and the Governor has signed several laws affecting employers in Illinois. The following is a brief summary of recent laws.
ARTIFICIAL INTELLENGE IN EMPLOYMENT PRACTICES
As artificial intelligence (AI) permeates our lives and employers use AI, knowingly or unknowingly (often through third-party services), Illinois law now regulates how employers may use AI. Beginning January 1, 2026, employers are prohibited from using AI in any way that unlawfully discriminates against current or prospective employees.
Unlawful discrimination includes basing decisions on hiring or promoting on perceived protected characteristics including race, color, religion, s*x, national origin, ancestry, military status, age (over 40), order of protection status, disability (mental or physical), marital status, s*xual orientation, unfavorable military discharge, arrest record (or criminal history record ordered expunged or impounded), conviction record (without a prior assessment of whether there is a substantial relationship between the conviction record and the job, or an unreasonable risk in allowing the employee to hold a particular job), pregnancy (including child birth or related medical or common conditions including reproductive health decisions), or family responsibilities. Illinois law now, for example, specifically prohibits using ZIP codes “as a proxy for protected classes,” addressing possible biases on algorithms used to advertise employment positions.
Under Illinois law, employers must provide notice when any form of AI is used for hiring, recruiting, disciplining, promoting, training, or discharging employees, or other employment actions. AI use in employment situations includes AI components that trigger the requirement to disclose its use. Notice of AI use is required when it is used “to influence or facilitate” employment decisions. This includes screening résumés, assessing interviews, scheduling meetings, etc.
Draft regulations issued by the Illinois Department of Human Rights on January 12, 2026, provide guidance. “Artificial Intelligence” is “a machine-based system that infers how to generate outputs, such as predictions, recommendations, or decisions that influence physical or virtual environments, … explicitly [including] ‘Generative AI,’ which can simulate human-produced content like text, images, or audio.”
The regulations apply whenever AI is used to influence or facilitate a “covered employment decision,” meaning any recruitment, hiring, promotion, tenure, discharge, discipline, selection for training or apprenticeship, and terms, privileges, or conditions of employment.
The draft regulations specify that employers are not to use AI in any “covered employment decision” without providing specific notice to prospective and current employees.
Illegal discrimination in employment has been broadened, with the protected classes, as noted above, being much broader. Furthermore, the statute of limitations for an employee or former employee to assert illegal discrimination has been expanded from 300 days to two years. Civil penalties for violations have also been increased. If the violating employer has not been adjudged to have committed another civil rights violation during the preceding five years, the civil penalty could be as much as $16,000 per violation. Otherwise, the fine could be as much as $70,000 for each violation. Note that the civil penalties are paid to the State, and the violating employer could still be liable to the employee whose rights were violated.
NEW PAY STUB OBLIGATIONS
As of January 1, 2025, the Illinois Wage Payment and Collection Act requires that pay stubs for all Illinois employees must include hours worked, rate of pay, overtime pay, overtime hours, gross wages earned, all deductions from wages, and year-to-date totals of wages and deductions. Current and former employees may request copies of pay stubs twice during any 12-month period, including the 12 months following employment. Employers have 21 days to furnish copies of this information upon request and must do so in the format requested, electronic or physical. The employer must maintain the employment records for three years.
WORKPLACE TRANSPARENCY ACT
Since 2020 Illinois has had the Workplace Transparency Act that essentially prevents nondisclosure, confidentiality, or non-disparagement agreements between employers and employees from preventing nondisclosure of “unlawful employment practices.” While this Act was initially aimed at s*xual harassment, the Act was recently amended and now has a broader scope “in securing individuals’ freedom from unlawful discrimination and harassment in the workplace.”
This Act is not applicable to collective bargaining agreements. However, “[n]o contract, agreement, clause, covenant, waiver, or other document shall prohibit, prevent, or otherwise restrict an employee, prospective employee, or former employee from (1) reporting any allegations of unlawful conduct to federal, State, or local officials for investigation …, or (2) engaging in concerted activity to address work-related issues, … or [to prevent] an employee or prospective employee from making truthful statements or disclosures about alleged unlawful employment practices or engaging in protected concerted activity to address work-related issues.”
Any agreement or provision that would require an employee or prospective employee “to waive, arbitrate, or otherwise diminish any existing or future claim, right, or benefit to an unlawful employment practice, … including that which shortens the applicable statute of limitations … is void to the extent it denies an employee or prospective employee a substantive or procedural right or remedy….”
Nonetheless, agreements with employees or former employees may include provisions that would otherwise be contrary to public policy, so long as any such agreement does not preclude the employee or prospective employee from:
a. reporting any good faith allegation of unlawful employment practices,
b. reporting any good faith allegation of criminal conduct,
c. participating in any proceedings related to unlawful employment practices,
d. making any truthful statements or disclosures required by law,
e. requesting any legal advice, or
f. engaging in any concerted activity to address work-related issues.
However, the law does not prohibit agreements between an employer and an employee or a prospective employee that includes “confidentiality related to alleged unlawful employment practices, other than future or prospective concerted activity related to workplace conditions,” provided that:
a. confidentiality is the employee’s or prospective employee’s preference and is mutually beneficial;
b. the employee or prospective employee has the right to have an attorney of their choice;
c. there is bargained for consideration for the confidentiality separate from other consideration;
d. there is no waiver of any claims of “unlawful employment practices that accrue after the” date of the agreement;
e. the employee or prospective employee is given at least 21 days to review the proposed agreement; and
f. the employee or prospective employee has seven days after executing the agreement to cancel it (unless voluntarily waived).
Violations of this Act can result in consequential damages and reasonable attorney fees and costs.
VICTIMS’ ECONOMIC SECURITY AND SAFETY ACT
Effective in 2003, the Victims’ Economic Security and Safety Act has been amended, effective January 1, 2026. This Act is intended to help protect employees who are victims of s*xual, domestic, or other crimes of violence, as well as the employees who have family and household members who are victims. Eligible employees are entitled to unpaid, job-protected leave, the length of which depends on the number of employees of their employer. If the employer has 1-14 employees, the leave could be up to 4 workweeks; for 15-49 employees, it is up to 8 workweeks; and for 50 or more employees, it is up to 12 workweeks.
Leave is available to seek medical care or psychological counseling, to obtain services from a victim services organization, to obtain legal assistance or participate in legal proceedings, and to engage in safety planning.
Employers are allowed to request reasonable documentation, such as copies of police or court records, medical or counseling records, statements from victim services organizations, clergy, attorneys, or medical professional, or funeral-related documentation.
Under this Act, employers may not refuse to hire, discharge, or otherwise discriminate against an employee, or retaliate against an employee for requesting or taking eligible leave, or otherwise interfere with an employee’s rights under the Act.
Under the most recent amendments to this law, employers must allow employees, and family or household members, to use employer-issued electronic devices to document or communicate about violence. Employers must also provide access to photos, recordings, or digital communications on employer-issued devices when needed for criminal proceedings.
Note that employers are also required to post a notice explaining these rights.
Employers who fail to comply with this Act may be required to reinstate an employee and could be liable for back pay, monetary damages, and civil penalties.
EQUAL PAY ACT AMENDMENTS
Since 2003 Illinois law has required all employers in Illinois to pay their employees the same compensation for equal or substantially similar work, regardless of gender, race, or ethnicity. This applies to hourly as well as salaried employees.
The characterization of “substantially similar work” encompasses skill, effort, responsibility, and working conditions. Differences in compensation are only permitted if based on legitimate, non-discriminatory factors, such as seniority, merit, quality or quantity of production, or other good faith criteria, such as education, training, or experience consistently applied.
Employers may not, however, base pay decisions on an applicant’s salary or wage history, require employees to keep their compensation confidential, or retaliate against employees for discussing wages, refusing to disclose pay history, or for filing a complaint or participating in litigation.
Furthermore, employers must not restrict employees from discussing compensation. Upon request, employers must provide certain pay-related information. Promotional opportunities must be announced in a manner that allows equal access to advancement.
Beginning January 1, 2025, employers with 15 or more employees must comply with job posting rules for positions to be performed at least in part in Illinois or that report to a supervisor in Illinois. For covered employers, this means that “pay scale and benefits” must be provided for all eligible job postings. A hyperlink to a publicly viewable webpage is sufficient if the webpage includes the pay scale and benefits. This requirement applies regardless of whether the employer posts the position or engages a third party to do so.
“Pay scale and benefits” includes “the wage or salary, or the wage or salary range, and a general description of the benefits and other compensation, including …bonuses, stock options, or other incentives…reasonably [expected to be offered] for the position….” Under recently published rules, the pay scale must include “the lowest to the highest pay the employer actually believes it might pay for the particular job, depending on circumstances such as employee qualifications, employer finances, or other operational considerations.”
Under this new requirement, all applicable employers must “announce, post, or otherwise make known all opportunities for promotion to all current employees no later than 14 calendar days after the employer makes an external job posting for the position.”
