August 6, 2020 | HR Compliance | Posted by Ascentis
Have Employees in Chicago? Here’s What You Need to Know About the Fair Workweek Law
One year ago, on July 24, 2019, the Chicago Fair Workweek (FWW) Ordinance was signed into law. This law took effect July 1, 2020 and imposes significant new obligations on many employers with locations within the Chicago city limits. Let’s review how those rules may affect you, and the role that your HCM suite elements can play in ensuring you satisfy them.
The Chicago FWW Ordinance applies to any employer in the covered industries of building services, healthcare, hotels, manufacturing, restaurants, retail or warehouse services that employs 100 or more employees total (250 or more in the case of not-for-profit organizations.) In addition, the employer must have at least 50 covered employees. Franchisees must have 250 employees and 30 or more locations globally, four or more of those locations being within the City limits.
Covered employees are those who work a majority of their time within the City limits, and earn $50,000 per year or less on a salaried basis, or $26 per hour of less on an hourly basis. Temporary workers are included provided that they work on assignment for the covered employer for at least 420 hours within an 18 month period. Contractors are not covered employees.
What the New Law Requires
The FWW Ordinance, at a high level, imposes several new obligations on covered employers, starting with shift schedules and notice of changes:
- Employers must provide covered workers a written estimate of days and hours of work prior to or upon employment,
- Employers must post work schedules with at least 10 days’ notice (this notice period increases to 14 days effective July 2, 2022),
- When employers then make changes to those published work schedules within 10 days (but more than 24 hours) before the work schedule starts, and those changes either add, subtract or reschedule previously committed work times, workers must receive one hour of new “predictability pay” for each such impacted shift,
- When employers then make changes to those published work schedules less than 24 hours before the work schedule starts, and those changes either add or change assigned shifts, workers must receive one hour of new “predictability pay for each such impacted shift, and where the employer’s change subtracts hours, the worker must receive 50% of their normal pay relating to the lost hours.
Additionally, the new FWW law provides covered employees a new “right to rest period:”
- The right to rest is defined as at least 10 hours off between shifts. Covered employees have the absolute right to refuse additional shifts that violate this right to rest.
- If an employee agrees to accept an additional shift with less than 10 hours off from his/her previous shift, the employer must record that agreement in writing, and the employee must be paid at 1.25 times regular hourly rate for the entire shift (or 1.5 times regular rate for any hours that qualify as overtime.)
There are several exceptions to certain rights written into the new law. Note, however, that there are NO exceptions to the right to rest. The following exceptions apply to the notice and predictability pay requirements:
- Threats to employers, covered employees, or property, or when civil authorities recommend that work not begin or continue
- When public utilities fail to supply electricity, water, or gas, or the sewer system fails to serve the location of work
- Acts of nature including flood, earthquake, tornado, or blizzard
- War, civil unrest, strikes, threats to public safety, or pandemics
- Mutually agreed shift trades or coverage arrangements between covered employees
- Work schedule changes that are mutually agreed to by the covered employee and employer and confirmed in writing
- A work schedule change that is the result of a covered employee’s request for a shift change, confirmed in writing
- Subtraction of hours from a work schedule for a written, documented disciplinary reason
- A banquet event being scheduled or rescheduled due to an issue outside the Employer’s control, or when attendee counts increase by more than 20%, or a new banquet event is scheduled within 48 hours of the event occurring and after the employer has provided the work schedule
- Events outside a manufacturing employer’s control result in changes in the need for covered employees
- Declared national, state, or municipal disasters or other catastrophic events, the implementation of a healthcare employer’s disaster plan, or incident causing a hospital to activate its Emergency Operations Plan that will substantially affect or increase the need for healthcare services
- Any circumstance in which patient care needs require a covered employee at a healthcare employer’s specialized skills through the completion of a procedure
- Any unexpected substantial increase in demand for healthcare due to large public events, severe weather, violence, or other circumstances beyond the healthcare employer’s control
- The cancellation, scheduling, rescheduling, postponement, or delay of a ticketed event, or when expected attendance increased by 20% or more, or when the duration of the ticketed event increases due to circumstances outside the employer’s control.
The law and follow-on FAQs outline a series of guidelines for employers to use in ensuring that a change in schedule is truly “mutually agreed upon” and specifies that Chicago Office of Labor Standards will apply a “facts-and-circumstances” analysis to any allegations that a schedule change was not truly mutually agreed. They also go on to say that under no circumstances may an employee waive their rights under the law permanently or for any ongoing period of time (i.e., indefinite future “mutually agreed” changes are prohibited, even if in writing.)
HCM Implications: The new Chicago FWW Ordinance will require that a number of new administrative processes be instituted by covered employers. Employers will need to (a.) post schedules per the minimum advance notice required under the law (note that electronic/employee self-service schedule posting is expressly permitted), (b.) notify employees of changes to those schedules timely per the ordinance, or make predictability payments to employees where they fail to do so, and (c.) ensure that their scheduling software is re-programmed to be aware of, and honor, required rest periods between shifts. A fourth “nice-to-have” feature may rise to a priority of “required” for certain employers having many such last minute schedule changes: (d.) engage an “advanced scheduling” feature that can reach out to workers to solicit volunteers willing to take a shift when a “last-minute” (as defined under the law) change is required. Remember, when the scheduled worker does not willingly accept the change in writing, one way to avoid the predictability penalty pay is to find a willing alternate worker to agree in writing (or electronically) to voluntarily take the shift.
Finally, the new ordinance is noteworthy for the ease with which workers can report violations. The City of Chicago not only encourages employees who believe that their rights under the law have been abridged to e-mail or “snail-mail” a complaint form, but they can also dial the City’s non-emergency “311” service, or even use a mobile device app (the “CHI 311” app) to make such a report. Violations carry a fine of from $300 to $500 per verified offense, per covered employee per day. Additionally, employees may bring a civil suit against the employer under the law.
[NOTE: In part due to the COVID-19 health crisis, in June the City of Chicago amended the ordinance by delaying a portion of its enforcement. ONLY the employee right to bring private civil actions under the law has been delayed until January 1, 2021. Other sanctions for non-compliance remain in effect, although the City also issued more specific guidance on exceptions to the schedule change notice provisions due to the pandemic.]