Illinois Imposes New Requirements on Employers Who Use Staffing Agencies

Illinois employers who use staffing agencies should take note. The state’s Day and Temporary Labor Services Act (the “Act”), which was last revised by the General Assembly in 2017, was significantly amended this past legislative session. The Act generally requires temporary staffing agencies in the state to register with the Illinois Department of Labor (IDOL) and makes it unlawful for a third-party client who uses temporary labor to engage an unregistered staffing agency. The Act also provides various rights for workers of staffing agencies, including, among other things, rights related to meals, transportation, wage payment, and equal pay.

On August 4, 2023, amendments to the Act went into effect that changed certain provisions as follows:

Right of Refusal

Temporary workers in Illinois employed by a staffing agency may refuse assignments to a client location if there is a labor dispute at that location. That is, a staffing agency must disclose to a temporary worker that a strike, lockout, or other labor trouble exists prior to dispatching the worker there, and the worker may refuse the assignment without consequence from the staffing agency.

Equal Pay for Equal Work

Temporary workers assigned to a staffing agency’s client for more than 90 calendar days must be paid at least the rate of pay and equivalent benefits as the lowest paid directly hired employee of the client who has the same level of seniority and performs substantially similar work. If no such employee exists, the workers must be paid not less than the lowest paid directly hired employee of the client with the lowest seniority. The calculation of 90 calendar days will not begin to run until April 1, 2024, at which point only the days actually worked by the worker must be counted (not the entire duration of the assignment).

Safety Measures

Several new requirements related to worker safety are now in effect. They include:

• Staffing agencies must inquire into a client’s safety and health practices, provide safety training to workers, transmit descriptions of the training program to client companies, provide the IDOL’s hotline number to employees, and inform workers to whom they may report safety concerns.
• Clients must document and inform workers about anticipated job hazards, review health and safety awareness training provided by the staffing agency to confirm that it addresses hazards in the client’s industry, provide training tailored to particular hazards at the client’s worksite, and document and maintain records of site-specific training as well as provide confirmation the training occurred to the staffing agency within three days of the training.
• If the client changes the job tasks or work location, or new hazards may be encountered, it must inform the staffing agency and the worker of the change in task or location and inform the staffing agency and the worker of job hazards not previously covered before the worker undertakes the new tasks as well as update personal protective equipment (PPE) and training for the new job tasks.
• A staffing agency or worker may refuse a new job task if the task has not been reviewed, or if the worker has not had appropriate training to do the new task.
• A client company that supervises a worker must provide worksite-specific training to the worker and must allow a staffing agency to visit any worksite where the worker works or will be working to observe and confirm its training and information related to the worksite job tasks, safety and health practices, and hazards.

Attorney General Actions

The Illinois Attorney General may make a request to a circuit court to suspend or revoke the registration of a staffing agency.

Civil Actions and Penalties

An interested party — that is, an organization that monitors compliance with public or worker safety laws, wage and hour requirements, or other statutory requirements — may initiate a civil action against a staffing agency or client if they believe the agency or client is violating the Act. For staffing agencies, the civil penalties for violating the Act have increased to between $100 and $18,000 for first violations and $250 to $7,500 for repeat violations. Violations by clients could incur a penalty between $100 and $1,500 for each violation.

With these ever-expanding protections for temporary workers in Illinois, employers who use temporary labor should review their existing contracts with staffing agencies to ensure compliance, particularly as the April 1, 2024, implementation date for the equal pay for equal work provision of the Act draws near.