Chicago Enacts Paid Leave and Paid Sick and Safe Leave Ordinance

What Changed

On November 9, 2023, the Chicago City Council passed the Chicago Paid Leave and Paid Sick and Safe Leave Ordinance, creating one of the most comprehensive municipal paid leave requirements in the country. The ordinance requires employers to provide two separate leave banks:

40 hours of paid sick leave per 12-month accrual period
40 hours of general paid leave (usable for any reason) per 12-month accrual period

Starting January 1, 2024, employees accrue one hour of paid sick leave and one hour of paid leave for every 35 hours worked. Employees may carry over up to 80 hours of paid sick leave and up to 16 hours of paid leave from one accrual period to the next.

The ordinance also includes posting, distribution, policy, and pay-stub disclosure requirements.

Who Is Affected

All employers with employees who perform at least two hours of work within the City of Chicago in any two-week period are subject to this ordinance, effective December 31, 2023. There is no minimum employer size threshold — this applies to employers of all sizes.

The ordinance covers all employees, including part-time and temporary workers, who meet the two-hour-in-two-weeks Chicago work threshold.

Where It Applies

City of Chicago, Illinois. The ordinance applies based on where the work is performed, not where the employer is located. Any employee who works at least two hours within Chicago city limits in any two-week period is covered.

Note: Illinois also enacted the statewide Paid Leave for All Workers Act effective January 1, 2024, and Cook County passed its own paid leave ordinance effective December 31, 2023. Employers with employees in the Chicago metro area should review all three laws for overlapping obligations.

When It Takes Effect

The ordinance became effective December 31, 2023, with accrual beginning January 1, 2024. Employers must also:

Post a notice of employee rights at each facility and distribute it with each employee's first paycheck (and annually every July)
Adopt and distribute a written policy explaining PTO and paid sick leave rights
Provide accrual and use information on each pay stub

Why It Matters

Chicago's ordinance carries some of the harshest penalties in the country for paid leave violations:

$1,000 to $3,000 per violation for leave violations, with each day of non-compliance counting as a separate violation
$500 for the first offense and $1,000 per subsequent offense for notice violations
A private right of action allowing employees to recover treble damages (three times the value of leave denied), plus interest and attorney's fees

The ordinance also requires payout of unused paid leave upon separation, which significantly impacts employers with unlimited or flexible PTO policies.

The Humareso Take

Chicago did not hold back with this one. Two separate leave banks, aggressive accrual rates, carryover requirements, and treble damages — this ordinance demands attention. If you have even a single employee who occasionally works in Chicago, you may be covered. The two-hour-in-two-weeks threshold is intentionally broad. We recommend auditing your workforce to identify who falls within scope and building your compliance infrastructure now rather than scrambling after a complaint.

Recommended Action Steps

Determine which employees are covered by identifying anyone who performs at least two hours of work within Chicago city limits in any two-week period.
Set up two separate leave accrual banks in your payroll/HR system — one for paid sick leave and one for general paid leave.
Post the required notice of employee rights at each Chicago-area work location and distribute it with each covered employee's first paycheck.
Adopt and distribute a written leave policy explaining paid leave and paid sick leave rights, accrual, usage, and carryover rules.
Update pay stubs to include paid leave accrual and usage information each pay period.
Review your PTO or unlimited leave policy to ensure it complies with the payout-on-separation requirement.
Contact your Humareso representative for help navigating the overlap between Chicago, Cook County, and Illinois state paid leave requirements.