Starting July 1, 2025, Chicago is strengthening paid leave/sick leave benefits (especially payout rules for mid-size employers and allowing private lawsuits).
The Paid Leave and Paid Sick Leave ordinance mandates that all Chicago businesses provide paid leave and paid sick leave to employees. Workers are guaranteed up to five days of paid leave and five days of paid sick leave.
Eligibility:
- Any employee who works at least 80 hours for an employer in Chicago OR resides in Chicago and works remotely for an employer within any 120-day period is covered by the ordinance and is eligible for paid leave and paid sick leave
- Employees begin to accrue paid leave and paid sick leave on the first calendar day after they begin their employment
Under the Paid Leave requirements:
- Employees accrue at a rate of 1 hour of paid leave for every 35 hours worked (up to 40 hours in a 12-month benefit period)
- Employees must be allowed to use accrued paid leave no later than on the 90th day following the commitment of employment
- Employees can carry over up to 16 hours between 12-month periods (if paid leave is not front loaded).
- Employees can use paid leave for any reason
Under the Paid Sick and Safe Leave requirements:
- Employees accrue at a rate of 1 hour of sick leave for every 35 hours worked (up to 40 hours in a 12-month period)
- Employees must be allowed to use accrued sick leave no later than on the 30th day following the commitment of employment
- Employees can carry over up to 80 hours between 12-month benefit periods
- Employees can use paid sick leave for medical and safety reasons
Payout on Separation:
- Medium-sized employers (51–100 employees) were previously only required to pay out up to 16 hours. That exemption ends July 1, 2025—all accrued unused paid leave (up to 40 hours) must now be paid upon separation, aligning with large employer requirements
- Small employers (≤50 employees) remain exempt
Private Right of Action:
- Employees may now bring private lawsuits to enforce their paid leave rights, with a 16-day “cure” window (July 1, 2025–June 30, 2026) to correct violations before litigation
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