Illinois Poised To Require Pay Transparency In Job Postings

Illinois is poised to become the latest state to require employers to provide salary information in job postings.  Governor J.B. Pritzker is expected to sign House Bill 3129, which amends the Illinois Equal Pay Act (IEPA) and requires employers to include pay scale and benefits information in job postings.  If the Bill is enacted, its requirements will go into effect on January 1, 2025, and will apply to employers with 15 or more employees and to positions that are (i) physically performed, in whole or in part, in Illinois or (ii) physically performed outside of Illinois where the employee reports to a supervisor, office or other work site in Illinois. 

The bill defines “pay scale and benefits” broadly to mean the wage or salary, or the wage or salary range, for the position and a general description of the benefits and other compensation, including, but not limited to, bonuses, stock options or other incentives the employer reasonably expects to offer.  The bill’s posting requirements can be satisfied by including a hyperlink in the job posting to a publicly viewable webpage that outlines the pay scale and benefits for the position.  Further, an employer may satisfy the bill’s benefits posting requirement by posting a relevant and up-to-date general benefits description in an easily accessible, central and public location on the employer’s website, and providing this location in the job posting.  The law also applies to internal promotions: if a job is posted publicly, but internal candidates may also apply for the position as a promotion, the employer must announce, post or otherwise make known to current employees that promotion opportunity within 14 days of externally posting the position. 

Notably, if an employer does not use job postings, the bill clarifies that it does not create any new requirement to do so. 

Use of a third-party posting service does not allow employers to circumvent the posting requirements; any third party that fails to provide the pay scale and benefits in job postings published on behalf of an employer is subject to liability, unless it can show that the employer failed to provide the necessary information.  Accordingly, Illinois employers should work closely with any third party they use to assist with job postings and recruitment to ensure that posting requirements are satisfied.

The law includes record-keeping requirements, including the obligation to preserve records of the pay scale and benefits information for each posted position for at least five years, or in the event of an ongoing investigation or action under the law, until their destruction is authorized by the Illinois Department of Labor (IDOL) or court order.

An employer that does not make pay scale and benefits information available to an applicant, through public or internal postings for the job, “shall disclose … the pay scale and benefits to be offered for the position prior to any offer or discussion of compensation and at the applicant’s request.” Additionally, the law includes an anti-retaliation provision: employers “shall not refuse to interview, hire, promote, or employ, and shall not otherwise retaliate against, an applicant for employment or an employee for exercising any rights” thereunder.

The IDOL may initiate investigations regarding compliance with the amendments under HB3129 at its discretion or upon receiving a complaint from any individual (within one year of the violation).  If the IDOL determines that a violation occurred, an employer may cure the violation within seven days; otherwise, the employer will be subject to civil penalties.  Excluding duplicative posts, each job posting not in compliance with the law will be considered a separate violation that could incur civil penalties.  Employers found to be in violation of the bill’s posting requirements face fines ranging from $250 to $10,000, depending on the number of prior violations, whether postings are duplicative, and whether the job posting is active or inactive at the time the notice of violation is issued.  The law does not provide for a private right of action.

This law is just the latest in a series of actions that Illinois lawmakers have taken regarding pay transparency issues.  In 2019, Illinois amended the IEPA to prohibit employers from requesting or requiring that job applicants disclose wage or salary history as a condition of employment.  In 2021, Illinois further amended the IEPA to require certain employers to obtain an equal pay registration certificate every two years and provide EEO-1 type diversity data in annual reports filed with the State. When the law becomes effective, Illinois will join a number of other states, including California, Colorado and Washington, in requiring the disclosure of salary information in job postings.