Illinois becomes sixth state to pass pay transparency legislation

Life moves pretty fast, so you may have missed that on May 17, 2023, the Illinois Legislature passed pay transparency legislation.

This is the second piece of legislation that Illinois has passed in an attempt to close the gender and racial pay gaps. Last year, Illinois joined California in passing a law requiring employers to report pay data.

Now, beginning January 1, 2025, Illinois will join Colorado, California, Washington State, New York State, Hawaii, and several cities, such as New York City, in requiring employers to include salary ranges in all job postings.

What will Illinois require? We’ve broken it all down for you:

Who must comply?

  • Employers with 15 or more employees. As it reads, the law does not specify whether all 15 employees must be in Illinois, or if a company must comply if it has 15 employees anywhere with at least one working in Illinois (similar to the language in California and Washington).

What if I’m posting for general remote roles that can be performed anywhere?

  • Employers will be required to comply if the job “will be physically performed, at least in part, in Illinois” or “will be performed outside Illinois, but the employee reports to a supervisor, office, or other worksite in Illinois.” This language is almost identical to the new amendments in New York State’s pay transparency law, which will take effect later this fall.

What information must employers include in job postings?

  • All job postings published after January 1, 2025 must include the following information:
    • Pay scale: the salary range that the employer “reasonably expects in good faith to offer for the position”;
    • Benefits: a general description of benefits and other compensation, including things like bonuses, stock options, or other incentives.

NOTE: The new Illinois law states that the “pay scale” should be set by reference to any applicable pay scale, the previously determined range for the role, the actual range of others currently holding equivalent positions, or the budgeted amount for the role. This may be intended to be additional guidance to help employers set the pay scale in job postings but may also open the door to allowing candidates to ask employers to clarify what exactly the “pay scale” they are seeing in the job posting is.

When must employers post salary ranges?

  • Salary ranges and a general description of benefits must be included in job postings for roles, promotions, or transfers.
  • Illinois also allows employers to include a hyperlink to the pay scale and benefits in job postings, instead of placing the information directly on the postings.

What about third parties who post roles for employers?

  • Third parties will be liable for their failure to include any of this information, unless they can show that they never received the information from the employer.

Will Illinois impose penalties on employers who don’t post salary ranges?

  • Yes. Employees, former employees, and candidates can file complaints with the Illinois Department of Labor (“Department”), who will investigate the claims.
  • The new law makes clear that a violation means one job posting that lacks the now-required information.
  • If the Department confirms the violation, employers will receive a notice.
    • First violation: Employers will have 14 days to remedy the violation, or they will receive a fine not to exceed $500.
    • Second violation: The employer will have seven days to remedy the violation, or they may receive a fine not to exceed $2,500
    • Third violation: If the violation has still not been remedied, there will be no cure period, and a fine not to exceed $10,000. If a company incurs a third violation, it shall incur automatic penalties without a cure period for five years. The five-year period shall restart if, during the five years, an employer receives a subsequent notice of violation from the Department.
  • The new law also prohibits employers from retaliating against employees or applicants who ask for a posted position’s salary range.

Is there anything else we should know?

  • The new law will require employers to keep records of their employees for a period of five years, which must include the following: the name, address, occupation, and wages paid to each employee, along with the pay scale and benefits for each position and the job posting for each position.

What’s next?

We are waiting for Illinois Governor J.B. Pritzker to sign the legislation into law, which we expect to happen in the next few weeks. After that, employers will have over a year to comply with these new laws.

To stay up -to -date on the latest pay transparency legislation in the United States, check out our legislation landing page.

Need help responding to pay transparency legislation?

To learn how Payscale helps organizations drive pay transparency objectives and build confidence in salary ranges posted on job descriptions, explore Payscale’s Pay Transparency Solution.

Need help responding to pay transparency legislation?

To learn how Payscale helps organizations drive pay transparency objectives and build confidence in salary ranges posted on job descriptions, explore Payscale’s Pay Transparency Solution.

Explore Payscale’s Pay Transparency Solution