Illinois 2025 Employment Law Wrap-Up: Essential Updates for Employers

Takeaways

• From the Illinois Human Rights Act to the Workplace Transparency Act, the state has announced a broad range of measures affecting workplace policies and compliance obligations.
• Other new laws impacting employers include the Warehouse Tornado Preparedness Act and the Family Neonatal Intensive Care Leave Act.
• Employers are encouraged to proactively review their current workplace policies, handbooks, and compliance procedures and consider the assistance of counsel.

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• Illinois General Assembly - Bills and Resolutions

Article

Illinois employers face a rapidly evolving legal landscape shaped by a wave of new legislation and regulatory changes that are or soon will be in effect and will affect workplace policies and practices.

From the Illinois Human Rights Act to the Workplace Transparency Act, the state has announced a broad range of measures affecting workplace policies and compliance obligations. Highlights of the most critical recent updates to Illinois employment law are discussed below.

Military Leave Act (formerly, the Family Military Leave Act)

Effective Aug. 1, 2025, Senate Bill (SB) 220 (Public Act 104-0078) requires Illinois employers with at least 51 employees to provide up to eight hours of paid leave per month, or 40 hours per year, to eligible employees who participate in military funeral honors details.

To qualify, employees must have worked at least 12 months and logged 1,250 hours in the preceding year. They also must be trained to perform funeral honors as either active or retired military members, reservists, National Guard members, or authorized providers such as veterans service organization members.

Leave must be paid at the employee’s regular rate, and employers cannot require the use of other paid leave before granting this time off. Employees need only give reasonable notice, although employers may request confirmation of participation. Certain care facilities may deny leave if it would compromise staffing or safety.

Service Member Employment and Reemployment Rights Act (ISERRA)

Effective Aug. 15, 2025, House Bill (HB) 1362 (Public Act 104-0176) updates the definition of “work days” under the Service Member Employment and Reemployment Rights Act for purposes of calculating differential compensation payable to public employees. Under the new language, “work days” refer to the number of shifts an employee would have worked during military leave, rather than calendar days.

The amendment also removes the provision that counted shifts extending into the next calendar day as two separate work days.

Further, the amendment entitles public employees to full compensation during the period of active service but limits the combined total of concurrent compensation to no more than 30 days in a calendar year.

Additionally, the amendment harmonizes ISERRA with the federal Uniformed Services Employment and Reemployment Rights Act by prohibiting all employers from requiring service members to use vacation, annual, or similar leave during a period of active service.

Warehouse Tornado Preparedness Act

Effective Aug. 15, 2025, HB2987 (Public Act 104-0262) requires warehouse operators to develop tornado safety plans within 120 days of the effective date (Dec. 13, 2025) or within seven days of becoming operational. Plans must be specific to each facility and updated annually. The Warehouse Tornado Preparedness Act also mandates that warehouses maintain designated emergency supplies in their tornado shelters.

Under this Act, “warehouse” is defined as a building in which warehouse workers perform their duties and goods are stored in industries defined by any of these North American Industry Classification System (NAICS) codes:

• 493 (for Warehousing and Storage) 
• 423 (for Merchant Wholesalers, Durable Goods)
• 424 (for Merchant Wholesalers, Nondurable Goods)
• 454110 (for Electronic Shopping and Mail-Order Houses)
• 492110 (for Couriers and Express Delivery Services)

Prevailing Wage Act

Effective Aug. 14, 2025, HB1189 (Public Act 104-0160) amends the Prevailing Wage Act to broaden the definition of “public works.” Under the new law, federal construction projects administered or controlled by a public body will fall under the Act’s scope — provided the prevailing wage rate meets or exceeds the federal rate set by the U.S. secretary of labor for the same locality and type of construction.

Victims Economic Security and Safety Act

Effective Jan. 1, 2026, HB1278 (Public Act 104-0171) amends the Illinois Victims’ Economic Security and Safety Act (VESSA) to expand protections for employees who are victims of certain crimes. Under this amendment, employees are expressly permitted to use employer-issued electronic devices, such as phones or computers, to record incidents of domestic violence, sexual violence, gender violence, or other crimes committed against themselves or their family or household members.

The amendment also prohibits employers from disciplining or retaliating against employees for making such recordings. Additionally, employers must allow employees to access any recordings made using these devices.

Blood and Organ Donation Leave Act

Effective Jan. 1, 2026, HB1616 (Public Act 104-0193) amends the Illinois Blood and Organ Donation Leave Act to expand eligibility for blood and organ donor leave to part-time employees.

Under the amended law, both full-time and part-time employees may take up to 10 days of leave within a 12-month period to serve as organ donors. For part-time employees, employers must calculate and compensate leave based on the employee’s average daily pay over the prior two months.

Illinois Human Rights Act

Effective Aug. 15, 2026, SB2487 (Public Act 104-0425) amends the Illinois Human Rights Act (IHRA) to make fact-finding conferences for open charges of discrimination discretionary rather than mandatory. Parties may still request a fact-finding conference if they make a joint, written request for a conference within 90 days of the charge being filed.

SB2487 also introduces civil penalties “to vindicate the public interest” of $16,000 and up. As with existing penalties under the law, the penalties may be issued, upon recommendation by a hearing officer, by the Illinois Human Rights Commission or a three-member panel thereof.

Passed in 2024 and effective Jan. 1, 2026, HB3773 (Public Act 103-0804) amends the IHRA to prohibit the use of zip codes as a proxy for protected classes and the use of artificial intelligence (AI) in employment decisions, including in recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure, or the terms, privileges, or conditions of employment (together, “Hiring Decisions”), where use of AI has the effect of subjecting employees to discrimination on the basis of protected classes. Employers using AI must also disclose to employees when they are using AI in their Hiring Decisions.

Transportation Benefits Program Act

Effective Jan. 1, 2026, HB3094 (Public Act 104-0272) amends the Transportation Benefits Program Act to expand eligibility for pre-tax commuter benefits to part-time employees. However, the amendment excludes construction workers covered by a collective bargaining agreement from receiving such benefits.

The law applies only to “covered employers,” which is defined as an entity that employs at least 50 employees at an address that is located within one mile of fixed-route transit service.

Digital Voice and Likeness Protection Act

Effective Jan. 1, 2026, HB3178 (Public Act 104-0282) amends the Digital Voice and Likeness Protection Act to spell out when contract provisions involving digital replicas are enforceable. A digital replica is an AI or computer-generated simulation of a person’s voice or image that is so realistic a reasonable observer would believe it is a performance by the individual being portrayed.

Under the amended law, any such contract is unenforceable only if it relates to a new performance by a digital replica of an individual, fixed on or after Jan. 1, 2026, that:

1. Allows creation of a digital replica of the individual’s voice or likeness in place of the work the individual otherwise would have performed in person; 
2. Does not include a reasonably specific description of the intended use of the digital replica; and 
3. The individual is not represented by either counsel or a union.

The amendment also provides details how to apply the “reasonably specific description” requirement.

On or after Jan. 1, 2026, failure to include such a description “shall not render the contract unenforceable when the uses of the digital replica are consistent with the terms of the contract for the performance of personal or professional services and the fundamental character of the photography or sound track as recorded or performed.”

Workplace Transparency Act

Effective Jan. 1, 2026, HB3638 (Public Act 104-0320) introduces key amendments to the Workplace Transparency Act. The new law prohibits agreements that would restrict employees from engaging in concerted activity.

The amendments also stipulate a number of agreements or provisions that are unenforceable if they are “unilateral”:

• That which purport to shorten the applicable statute of limitation; 
• That which apply non-Illinois law to an Illinois employee’s claim; 
• That which require a venue outside of Illinois to adjudicate an Illinois employee’s claim; or
• That which states the agreement or provision is the preference of the employee.

Lastly, the amendments require that any bargained-for consideration for confidentiality, non-disparagement, or speech-related provisions, generally, must be “separate from any consideration that is provided in exchange for a release of claims.”

Nursing Mothers in the Workplace Act

Effective Jan. 1, 2026, SB212 (Public Act 104-0076) amends Illinois’ Nursing Mothers in the Workplace Act to clarify that employers must provide paid break time for employees to express breast milk for one year after childbirth, unless doing so would cause an “undue hardship” as defined by the Illinois Human Rights Act.

These breaks may run concurrently with existing break periods, but employers cannot require employees to use paid leave or reduce their compensation during this time.

Family Neonatal Intensive Care Leave Act

Effective June 1, 2026, HB2978 (Public Act 104-0259) requires Illinois employers with at least 16 employees to provide unpaid, job-protected leave to employees whose child is hospitalized in a neonatal intensive care unit (NICU) under the newly enacted Family Neonatal Intensive Care Leave Act.

The Act mandates up to 10 days of unpaid leave for employers with 16 to 50 employees, and up to 20 days for those with at least 51 employees. Employers with up to 15 employees are exempt. Leave may be taken continuously or intermittently, with a minimum increment of two hours for intermittent leave.

Employees eligible for leave under the federal Family and Medical Leave Act (FMLA) must first exhaust their FMLA entitlement before using NICU leave. Employers may request reasonable verification of the child’s NICU stay but cannot demand confidential medical details. Additional protections include guaranteed reinstatement to the same or equivalent position, continuation of health insurance benefits, and protection from retaliation.

Employees may choose to substitute available paid leave for unpaid NICU leave, but employers cannot require it.

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Given the scope and impact of these legal developments, employers are encouraged to proactively review their current workplace policies, handbooks, and compliance procedures.

If you have questions about how these changes may affect your organization or need assistance updating your policies, please contact the Jackson Lewis attorney with whom you regularly work.