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New Amendments to the Illinois Day and Temporary Labor Services Act (IDTLSA) Have Major Implications for Temporary Staffing

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On August 4, 2023, Illinois Governor JB Pritzker signed House Bill 2862 into law, enacting substantial amendments to the Illinois Day and Temporary Labor Services Act (IDTLSA). The changes, which took effect immediately, not only significantly expand protections for an estimated 650,000 temporary workers in the state but may provide key insight into the future of temporary staffing regulations nationwide.

A particularly notable change is a requirement that temporary workers assigned to the same client company for over 90 days in a 12-month period must receive equal pay and benefits as the lowest paid direct employee in an equivalent role and seniority level (or the closest seniority level if no direct equivalent exists).  This is a major change from the previous version of the Act, which only required compliance with minimum wage and overtime laws. It is also a change that can be expected to have far reaching implications as it dramatically alters the incentives and economics of temporary work from the worker, employer, and agency perspective.

Another notable change is the lifting of the prohibition against assigning temporary workers to worksites with active labor disputes. The amendment replaces the prohibition with a requirement that the agencies notify the assigned temporary workers of any disputes and their right to refuse the assignment without fear of retaliation. This change appears to have been a response to a court finding that an absolute prohibition was preempted by the National Labor Relations Act.

The amendments also substantially increase oversight and enforcement mechanisms. For instance, staffing agencies and their clients now face statutory penalties ranging from $100 to $18,000 for their first violations, and $250 to $7,500 for each subsequent violation within a three-year period. Notably, under the Act, a separate violation occurs for each worker and for each day a violation continues. “Interested” third-party organizations, in turn, may now sue to enforce the Act and, if they are successful, collect 10% of any statutory penalties assessed, plus attorney fees and costs. This is a big deal.

It is worth noting, however, that the IDTLSA continues to specifically exclude temporary workers who perform work of a “professional or clerical nature” from its protections.

While the IDTLSA is specific to Illinois, with the use of temporary workers expanding rapidly across the country, more states are likely to follow Illinois’ lead in passing laws regulating agency practices. All employers—particularly multistate employers—utilizing temporary workers should, accordingly, take note of what Illinois has done as it may forecast changes in other states.

The full text of HB 2862, showing the changes made to the IDTLSA can be found here.

On August 7, 2023, the Illinois Department of Labor (DOL) also issued Emergency Rules to implement and clarify key provisions of the newly amended IDTLSA. Those Emergency Rules will remain in effect until they expire on January 4, 2024 or permanent rules are adopted. The Emergency Rules can be found here and the Proposed Permanent Rules can be found here.

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