The Fair Workweek Ordinance requires certain employers to provide workers with predictable work schedules and compensation for shift changes. Employees are covered by the ordinance if they work in Chicago in one of seven “covered” industries — Building Services, Healthcare, Hotels, Manufacturing, Restaurants, Retail and Warehouse Services, they make less than $26/hour or $50,000/year and the employer has at least 100 employees globally — 250 employees and 30 locations for a restaurant and 250 employees for nonprofits. Covered employees are entitled to:

• Advance notice of work schedule (10 days beginning July 1, 2020 and 14 days beginning on July 1, 2022)
• Right to decline previously unscheduled hours
• One hour of Predictability Pay for any shift change within 10 days
• 50% base pay for hours and shifts cancelled within 24 hours’ notice
• 1.25 times regular pay for any shift that begins less than 10 hours after the end of the previous day’s shift
• Right to rest by declining work hours less than 10 hours after the end of the previous day’s shift.

COVID-19 Exception

The ordinance provisions apply unless COVID-19 causes the employer to materially change its operating hours, operating plan or its goods or services, resulting in the work schedule change.

Fines

Any employer that violates the ordinance can be subject to a fine of between $300 and $500 for each offense. Each covered employee whose rights are affected constitutes a separate and distinct offense to which a separate fine applies, and each day that a violation occurs constitutes a separate and distinct offense to which a separate fine applies.

Administrative Remedies

An employee must first exhaust his or her administrative remedies with the City of Chicago Department of Business Affairs and Consumer Protection before filing a private lawsuit.

The ordinance provides that an employee may initiate a civil action only after:

• The employee submits a factually supported written complaint to the Department alleging a violation.
• The Department forwards the complaint to the employer and provides the employer with an opportunity to contest the alleged violation or cure the violation.

AND

• The Department has notified the complaining employee and the employer in writing that the Department considers the complaint to be closed.

The Department may consider a complaint closed because:

• The complaint has been cured by the employer.
• The Department has deemed the complaint justified and has enforced it against the employer to conclusion.

OR

• The Department has deemed the complaint unjustified or unsupported.

Accordingly, much like an administrative charge at the Equal Employment Opportunity Commission, an employee will have the ability to file a private action regardless of the results of the city’s investigation.

Private Right of Action

A claim or action must be filed within two years of the alleged conduct resulting in the complaint. A covered employee who prevails in a civil action is entitled to an award of compensation for any damages sustained as a result of a violation of the ordinance, including litigation costs, expert witness fees and reasonable attorney’s fees.

Even though employers could not be sued prior to January 1, Isaac Richman, a spokesperson for the Department of Business Affairs and Consumer Protection, recently stated that the city’s Office of Labor Standards reports that it is already investigating 82 complaints about violations of the law by 49 different employers.

Key Takeaways for Employers

Employers affected by the lifting of the moratorium should evaluate how to revamp their policies and procedures to ensure compliance with the new law. More importantly, employers should train human resources, payroll and management employees with responsibility over scheduling to ensure that they help establish a culture of compliance with this new requirement. Employers may also wish to explore technological solutions such as automatically locking schedules and requiring active override by human resources to make any revisions beyond the lock date, to ensure their leaders stay ahead of any issues. Of course, ensuring a happy workforce that feels respected and invested is a critical first step to minimize litigation risk from what is likely to be an area rife with human error. Keeping up to date in this area is also important given that current and developing COVID-19 related considerations could have an impact on future enforcement efforts with respect to this new law.

Given the significant penalties at issue, the potential for class claims, and the availability of attorneys’ fees, we expect that employers will see litigation develop quickly in this area. Employers should therefore ensure that promptly developing a plan for compliance, with assistance from counsel where appropriate, is one New Year resolution they intend to keep.

For a more detailed analysis of the ordinance’s provisions, please see the firm’s prior alert.