Illinois Adds More Requirements to Its Equal Pay Act

Foley & Lardner LLP

Foley & Lardner LLPAfter a relatively quiet 2020 from an employment legislation perspective, the Illinois Assembly has been busy crafting new laws in 2021. We recently reported on new legislation related to restrictive covenants, but the Illinois legislature also added new amendments to the already retooled Illinois Equal Pay Act. While perhaps not as far-reaching as Colorado’s new equal pay law, Illinois employers should still begin preparing now for when the law becomes effective in March 2024.

Under the amendments, employers with more than 100 employees in Illinois must certify to the Illinois Department of Labor (IDOL) compliance with the Equal Pay Act by obtaining an Equal Pay registration certificate from the state Department of Labor. The amendments require employers to do the following:

(1) Pay a $150 filing fee;

(2) Submit a signed statement that the business is in compliance with Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, the Illinois Human Rights Act, the Equal Wage Act, and the Equal Pay Act of 2003 (the “Statutes”); 

(3) For businesses required to file an EEO-1 with the EEOC, submitting a copy of the business’s most recently filed EEO-1; and

(4) Compile and submit a list of all employees during the past calendar year (from records maintained and available), separated by gender and race and ethnicity categories reported in the business’s most recently filed EEO-1, as well as report the total wages paid to each employee during the past calendar year, rounded to the nearest hundred dollars.

The amendments are not entirely specific on what it means to be “in compliance” with the statutes. However, the amendments are clear that the compliance statement must also certify that: (1) the average compensation for its female and minority employees is not consistently below the average compensation, as determined by rule by the IL DOL, for its male and nonminority employees within each job category listed in the business’s EEO-1; (2) the business does not restrict employees of one sex to certain job classifications and makes retention and promotion decisions without regard to sex; (3) wage and benefit disparities are corrected when identified to ensure compliance with the statutes; and (4) the business evaluates its wages and benefits for equality, and describe how often wages and benefits are evaluated to ensure compliance with the statutes. Included with the certification, businesses must also describe how they set wages (i.e., market pricing approach, state prevailing wage or union contract requirements, performance pay system, etc.)

These various requirements are not inconsistent with what the EEOC requires in its EEO-1 reporting, but the amendments do add a substantial amount of data that needs to be submitted to IDOL. These requirements are not to be taken lightly, either. The amendments provide IDOL with broad subpoena and audit authority, and expressly permit IDOL to examine “all books, records, and other evidence relative to the matter under investigation,” to include the taking of depositions, and also requesting any “other information identified by the business or [IDOL] as needed, to determine compliance.”

For now, Illinois employers should start tracking and evaluating this data in preparation for reporting in the not-so-distant future. Any pay inequity issues should be addressed and remedied. 

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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