November 17, 2023

This Week in Illinois

Session Update

The House and Senate both returned to Springfield last week for the conclusion of veto session. Activity for the week wrapped up last Thursday afternoon. Per HJR 45, both chambers will return to Springfield on January 16th at the call of the Speaker and Senate President. The 2024 Spring session calendar is now available. Click to view the House and Senate calendars.

Illinois Chamber Signs-On to PPWO Comments Responding to DOL’s Proposed Rulemaking on Overtime

Recently, the Illinois Chamber joined the Partnership to Protect Workplace Opportunity (PPWO) and 244 national, state, and local organizations representing employers from a wide range of private industry and public, nonprofit and education sectors filed comments urging the U.S. Department of Labor (DOL or “Department”) to abandon the agency’s proposed 69 percent increase to the minimum salary an employee must receive to qualify as a “white collar” employee exempt from federal overtime pay requirements under the Fair Labor Standards Act (FLSA).

While the Biden Administration announced in December of 2021 that it was contemplating an increase to the minimum salary for white collar  exemptions, the Department did not announce the proposed salary level until September 8 of this year, when the agency issued a Notice of Proposed Rulemaking that proposes an increase from the current minimum of $35,568 annually, which was set in 2019, to a projected minimum of $60,209 annually. The Department has based the proposal on a formula that sets the proposed minimum to the 35th percentile of earnings for all full-time salaried workers in the lowest-wage Census Region at the time the final rule is published. The Department has also proposed automatically increasing the minimum salary every 3 years by pegging it to the 35th percentile formula.

The Department only provided the public with 60 days to comment on the proposed rule, even though hundreds of stakeholders asked the Department for more time to comment. In addition, the Department’s proposal would only allow employers 60 days to implement the changes following release of a final rule, even though by the agency’s own estimate, 3.6 million workers who are currently exempt white collar workers make less than $60,209. For each of these 3.6 million workers, employers will need to determine whether to raise an employee’s salary to meet the new threshold, reclassify them as hourly, or restructure the job or department and distribute work differently, which may result in reductions in force. Oxford Economics, which evaluated the rule on behalf of the National Retail Federation, estimates far more workers–as many as 7.2 million–would be impacted by the Department’s proposed increase. Based on the Department’s timetables, PPWO estimates DOL could issue the final rule as early as March 1, 2024, and employers would need to implement the changes as early as May 1, 2024.

Top line issues raised in PPWO’s Comments:

• Employees Will Have Fewer Opportunities for Flexible and Remote Work and Career Development 
• Employees Will Have Fewer Opportunities for Part-Time Work
• Most Employees Will Not Receive Additional Compensation, and Some Employees May See a Reduction in Pay
• Businesses, Nonprofits, Schools, Local Governments and Workers in Rural and other Low-Cost Areas Will be Hit the Hardest
• The Department’s Proposed Rule Is Unlikely to Withstand Judicial Scrutiny

Thank you to the Partnership to Protect Workplace Opportunity for their work on this issue. Learn more here. Read the full comments here.

$25 Million Available in B2B Grants for New Businesses

The Illinois Department of Commerce and Economic Opportunity (DCEO) today announced $25 million in available grant funding through the Back to Business (B2B) NewBiz program. Following state recovery programming for businesses totaling $1.5 billion, the latest American Rescue Plan Act (ARPA)-funded opportunity is designed to provide additional support for businesses in hard-hit sectors who launched during the pandemic. Businesses that launched in 2020 or 2021 and remain in operation have faced significant impacts during the pandemic, but they have not been eligible for other federal or state relief programming since they were not operational prior to the pandemic.

To provide hands-on support and raise awareness about the program, the State has mobilized a network of nearly 100 community navigators across Illinois. Applicants are encouraged to visit b2bnewbiz.com to learn more and apply. 

Applications are open from November 30 through January 11, 2024, and awards are expected to be made several weeks after the deadline date. All eligible applicants will receive a grant as long as the business meets eligibility requirements and submits proper documentation and attestations.

To qualify for the B2B NewBiz program, businesses must have launched between January 2020 and December 2021 and be in an industry that was particularly impacted by the pandemic (As outlined here), or a business that was started by an individual or individuals that became unemployed during the pandemic. Eligible funding amounts are based on when the business was established and whether the business is home-based or operating out of a “brick-and-mortar” establishment.

Learn more here.

Reading List: US Chamber 2023 Crime Risk to Business Report

The US Chamber recently released its 2023 Crime Risk to Business Report. According to the US Chamber, communities and businesses across the U.S. are facing a historic increase in crime, an alarming trend requiring a robust response. The rising crime problem is affecting both small businesses and large retailers and warrants a serious response from policymakers. While commending progress made in the fight against retail crime, the report notes much more needs to be done and outlines needed policy actions from local, state, and national lawmakers. 

Read the Crime Risk to Business Report here.

Bill Action of Note:

SB 765, Farm Mutual Insurance-Support was signed into law. This bill provides that, until the date that is 5 years after the effective date of the amendatory Act, a farm mutual insurance company insuring against the perils of wind or hail must have and maintain adequate catastrophic reinsurance (instead of catastrophic reinsurance which limits the company's exposure on any one loss occurrence to 20% of its policyholders' surplus). Defines "adequate catastrophic reinsurance" as reinsurance in an amount no less than that required for a 500-year event, based on an actuarially sound catastrophe model that limits the company's exposure on any one loss occurrence to (i) 20% of its policyholders' surplus or (ii) an amount authorized by the Director of Insurance. Provides that a farm mutual insurance company must additionally have and maintain aggregate reinsurance coverage in an amount no less than that required for a 250-year event, based on an actuarially sound catastrophe model. Provides that the reinsurance permitted or required under the provisions must be provided by (i) a farm mutual insurance company, (ii) an insurance company authorized to write the kinds of insurance described in the Illinois Insurance Code pertaining to casualty, fidelity, surety, fire, marine, and other types of insurance, or (iii) a reinsurer and reinsurance program meeting the standards set forth in the Illinois Insurance Code that permit a domestic company to take credit for reinsurance. Requires a farm mutual insurance company converting from unlimited catastrophic reinsurance to adequate catastrophic reinsurance to provide notice of the change to policyholders in a form approved by the Director of Insurance. 

Save the Date: 10th Annual Illinois Chamber New Laws Forum

The New Laws Forum focuses on the new laws and legal developments that will affect ALL Illinois employers in 2024 and beyond. The forum features Illinois attorneys and experts speaking about Illinois laws – as well as representatives from government agencies talking about the latest changes and your peers, a panel of Senior HR professionals discussing how the laws have and will affect their businesses. It's already been a busy year, and more regulation is coming.

When: December 5, 2023 | 8:30 am – 4:30 pm

Where: Doubletree Hilton l 3003 Corporate West Drive

Lisle, IL 60532

Register Here.