Since Illinois first enacted the Day and Temporary Labor Services Act (the “Act”) in 2006, the number of temporary workers in the state has more than doubled, from 300,000 to over 650,000 workers. The number of registered temporary worker agencies has also doubled, from 150 to over 300. To address the dramatic increase in temporary laborers, on August 4, 2023, Governor Pritzker signed HB 2862, which amends the Act to provide additional protections to these workers, including new safety and training requirements and pay transparency. Upon its signing, HB 2862 became retroactively effective as of July 1, 2023.

The Act broadly defines a “day or temporary laborer” (“temporary worker”) as any person who contracts for employment with a day and temporary labor service agency (“temp agency”), which is any person or entity engaged in the business of employing day or temporary laborers to provide services to a third-party client. Essentially, the law deals with temporary workers who provide services for a short duration of time through a temp agency.

Amendments to the Day and Temporary Labor Services Act

HB 2862 imposes several new obligations on temp agencies and companies they serve. For example:

• Temporary workers assigned to a third-party client for more than 90 calendar days must be paid no less than the rate of pay and equivalent benefits of the lowest paid directly hired comparator employee (defined as an individual with equal seniority to the temporary worker who performs the “same or substantially similar” role under similar working conditions). In other words, when it comes to compensation and benefits, companies must put temporary workers on the same footing as regular employees.
• If there is no directly hired comparator employee, the temporary worker must be paid no less than the rate of pay and equivalent benefits of the lowest paid directly hired employee with the closest level of seniority.
• The temp agency may pay the hourly cash equivalent of the actual cost of benefits instead of providing the benefits to the temporary worker.
• Upon request, a third-party client must provide the job duties, pay, and benefits of directly hired employees to the temp agency, when a temporary laborer has been assigned to the third-party client for more than 90 calendar days.
• If the third-party client fails to provide the requested information, the temp agency can file suit to recover compensatory damages and up to $500 from the third-party client for each violation, and attorneys’ fees and costs. The failure to provide each piece of required information constitutes a separate violation.
• The amendment also increases the civil penalty that may be imposed on a third-party client for failing to provide a temporary worker with daily work verification forms. The penalty is now between $100 and $1,500 for each violation (up from a maximum of $500), and between $500 and $7,500 for a subsequent violation (up from a maximum of $2,500).
• The amendment also allows any “interested party” (defined as any organization that monitors or is attentive to compliance with public or worker safety laws, wage and hour requirements, or other statutory requirements), after exhausting administrative remedies before the Illinois Department of Labor, to initiate civil actions against both staffing agencies and clients if they have a “reasonable belief” that there has been a violation of the Act within the preceding three years.

Temp Agency Responsibilities to Temporary Workers

Temporary labor service agencies also find themselves with new requirements under the amendment. Specifically, a temp agency must:

• Inquire about the safety and health practices and hazards at the workplace before assigning an employee to a client’s worksite, and make the client aware of any job hazards, urge them to correct the hazards, and document its efforts (or remove the temporary worker from the job site);
• Provide temporary workers with general awareness safety training for recognized industry hazards in the preferred language of the worker;
• Transmit a general description of the safety training to the third-party client; 
• Provide temporary workers with the IDOL’s hotline number for reporting safety hazards; and
• Inform temporary workers how to report safety concerns in the workplace.

Third-Party Client Responsibilities to Temporary Workers

Before a temporary worker can begin work for a third-party client, the client must:

• Document and inform the temp agency of anticipated hazards the temporary laborer is likely to face;
• Review safety and health awareness training to confirm the training addresses the hazards in the client’s industry;
• Provide specific training tailored to hazards at the client’s worksite;
• Allow a temporary worker to visit any worksite where the worker will be working to observe and confirm the worker received all necessary training; and
• Document and maintain records of site-specific training and, within three business days of providing the training, issue confirmation to the temp agency that the training occurred.

If the client changes the job tasks or work location after the engagement begins, the client must inform the temp agency and worker, and also advise of any job hazards not previously covered and update any necessary personal protective equipment and training.

Temporary Workers Now Have the Right to Refuse Certain Work Assignments

Under the amendment, a temp agency may not send a temporary worker to a worksite where a labor dispute (i.e., a strike, lockout, or other “labor trouble”) exists without providing a statement to the temporary worker advising them of the labor dispute. The statement must be in a language understood by the temporary worker and inform the worker of the right to refuse the assignment without prejudice to receiving another assignment.

A temporary worker can also refuse a new job task at a worksite when the task has not been reviewed or if the worker has not had appropriate training to perform the task.

Implications of the Amendments

The amendments place a greater responsibility on temp agencies and their clients to provide specific pay, trainings, benefits and documentation.

These new requirements begin to close the gap between temporary laborers and regular employees. For years, temporary laborers were not provided the same compensation, training, rights, and protections as regular employees.  Now, in light of these amendments, contracting with temp agencies may be cost and operationally prohibitive for third-party clients, at least for those temporary workers working at clients for more than 90 days. Certainly, companies who use temp agencies should expect increased costs associated with working with such agencies, as well as additional information reporting requests.  

Employers who engage temporary workers should closely review all the requirements outlined in the amendment to ensure their compensation, hiring, training, and document retention  and sharing practices comply with the Act.