IN THIS ISSUE:
This Week In Springfield committee action was the focus and will only intensify as next week is the first committee deadline. When the Assembly leaves town next Friday, any legislation remaining in committee that does not have its consideration deadline extended will be considered ‘held’.
This week, on a party-line vote, the House Labor & Commerce Committee approved for consideration a proposed increase to Illinois’ minimum wage. HB 3345 (Rep. Art Turner, D- Chicago) envisions increasing the Illinois minimum wage from $8.25 to $9.00 on July 1, 2015 and from $9.00 to $10.00 on July 1, 2016. It also prohibits home rule municipalities from establishing their own minimum wage but this provision would not apply to the City of Chicago. Additionally, HB 3345 contains a limited income tax credit to help employers with fewer than 50 employees absorb the increased costs.
TWIS readers will recall that in early January the first act of the Illinois Senate was to the Illinois House a proposed minimum wage increase. SB 11 (Sen. Kimberly Lightford, D- Westchester) proposed increasing the Illinois minimum wage from $8.25 per hour to $11 per hour starting July 1st and ending July 1, 2019. Otherwise, the two bills are virtually identical.
The advocates of increasing the minimum wage have long argued that such increases do not negatively impact employers. The presence of the tax credit is a significant admission that such increases in the minimum wage do add substantial costs to employers.
As it has for a few years now, the minimum wage debate will continue to rage but it is certainly moving closer to some sort of finale. While anything is possible, IRMA does not expect immediate action on either bill. However, with Governor Rauner having himself proposed an increase to the minimum wage, the likelihood of some increase passing before the Assembly departs later this year grew more likely this week.
Illinois employers would soon have to provide up to twelve unpaid weeks to employees to tend to people with whom they are related to but do not have an existing relationship. SB 1238 (Sen. Napoleon Harris, D-Chicago) expands the federal Family Medical Leave Act (FMLA) by removing federal Department of Labor (DOL) criteria that establishes a requisite relationship between family members to determine leave eligibility. The FMLA criteria is a fact intensive inquiry that proves that there is a qualifying relationship, i.e. the individual was raised by the applicant or the applicant raised the individual. This could be an aunt, uncle, brother, sister, or even a person who is not biologically related to the individual. If an applicant can prove the fact intensive inquiry then they may take up to 12 weeks of unpaid leave to care for the individual. These criteria were established by the FMLA and subsequent DOL administrative interpretations to recognize the status of a modern family while at the same time protecting employers from abuse of FMLA leave rights.
As drafted, SB 1238 does not require a fact intensive inquiry to prove there is an existing relationship between the applicant and the family member. For instance, all an applicant would have to prove is that they are biologically related and the family member is sick. So therefore, an employee who has never met their grandparent, aunt, uncle, etc. and has no existing relationship could ask and be awarded 12 weeks of unpaid leave to care for their family member. As such SB 1238 eliminates the delicate balance created by Congress and the DOL to protect employers and non-traditional families.
The sponsor has agreed to amend the legislation to tie the requirements of the bill straight to the FMLA statute. There are a number of concerns with this approach. The federal FMLA is constantly changed and interpreted by US DOL rules, regulations and adjudications. For instance, the fact intensive inquiry mentioned above to establish a qualifying relationship was decided through US DOL case law and administrative review not the language of the FMLA. If the amendment is referenced only to the FMLA statute and not subsequent US DOL rulings and interpretations, the amendment could actually reduce the minimum protections intended for employers. Also, since the FMLA is always being changed by US DOL cases and adjudications, Illinois would be required to constantly update its statute. The amendment could also potentially give the IL DOL additional investigative and punitive authority over employers that it currently does not have. For the reasons, stated above, the sponsor has indicated that he intends on having continued discussion regarding this initiative.
An initiative to address the notification process for food allergens passed out of the Consumer Protection Committee this week only after the sponsor promised the committee she would work with IRMA and other opponents to amend the language on the House floor. HB 3495 (Rep. Robyn Gabel, D-Evanston), which is directed at restaurants, would require the certified Food Service Sanitation Manager on duty to register for the FDA’s text/email service which notifies the public about recent food allergy recalls. The management must then take precautions to notify staff of the recall and check the supplies of recalled food. In addition, the bill requires restaurants to place a notification in the restaurant that customers should tell their servers of food allergies. The notification can be placed on the menu/menu board, a placard or poster in the restaurant. Restaurants already have procedures in place to process recall notices received from the manufacturers or FDA. Illinois should not impose a one-size fits all. Additionally, changing menus, again, after just doing so to abide by federal nutritional labeling requirements imposes a significant expense. Food allergy sufferers are very proactive already so the question becomes whether additional notification really adds any value.
We appreciate that Rep. Gabel is willing to continue to work with IRMA to ensure that the bill allows current corporate food allergy notification systems to remain in place while exploring potential alternatives to encouraging customers to be more proactive than they already are. We look forward to an amendment before a vote is taken on the House floor.
As consumers increasingly turn to social media as one of their primary sources to receive information and news, businesses have moved much of their advertising to this platform to reach their audience right where they are. HB 3237 (Rep. Sara Feigenholtz, D-Chicago) was introduced to ensure that liquor manufacturers and distributors could provide retailers and restaurants with the opportunity to advertise on social media platforms without violating important “of value” laws. The bill passed out of the Executive Committee unanimously.
IRMA would like to thank Rep. Feigenholtz and co-sponsor Rep. Ron Sandack (R-Downers Grove) for keeping the law current with the increasing changes in technology, allowing retailers and restaurants to remain relevant to their customers.
REDUCING LLC FEES
SB 680 (Sen. Heather Steans, D-Chicago) would reduce the costs of establishing Limited Liability Corporations in Illinois. Currently it costs $500 to file the Articles of Incorporation and $750 to for businesses that want to file Articles to establish series. Those costs would be reduced to $39 and $59 respectively. The bill passed out of the Commerce and Economic Development Committee unanimously.
IRMA would like to thank Sen. Steans for sponsoring this business friendly action to reduce the front-end costs of potential business owners, particularly small business owners, so that they can spend that money investing in their business and growing the economy.
Despite Illinois’ lagging economy and need for substantial and sustained growth over a long period to get Illinois back on track fiscally, proposals continue to be advanced that only add to employer costs and make it harder to hire or retain employees, increase salaries, and open or expand businesses. Make your voice heard. Join your fellow employers in Springfield on Wednesday, May 6th to hear from policy makers and have your voice heard. Governor Bruce Rauner will keynote the opening luncheon. Register today at www.irma.org .