On June 1, 2026, the City of Chicago’s revised rules implementing the Paid Leave and Paid Sick and Safe Leave Ordinance (“Ordinance”) took effect. Although the amendments do not fundamentally change the Ordinance, they provide important clarification regarding employer obligations and enforcement.
Chicago employers should review their policies and practices to ensure they remain compliant with the updated rules.
- Joint Employers Are Expressly Responsible for Compliance
The revised rules formally recognize joint employment and provide that all joint employers are responsible for compliance with the Ordinance.
The rules define joint employment as situations in which two or more entities share control over the essential terms and conditions of an employee’s work. Common examples may include relationships involving staffing agencies, professional employer organizations, and similar workforce arrangements.
Importantly, jointly employed workers must be counted by each joint employer when determining whether coverage thresholds under the Ordinance are met.
- Non-Exempt Employees Accrue Leave on All Hours Worked
The revised rules clarify that non-exempt employees accrue Paid Leave and Paid Sick Leave on all hours worked, including overtime hours. By contrast, accrual for exempt employees may be calculated based on a maximum 40-hour workweek.
This clarification may affect employers whose payroll or leave-tracking systems currently calculate accruals based only on regularly worked or scheduled hours as opposed to actual hours worked.
- Expanded Guidance on Childcare-Related Leave
The Ordinance permits employees to use Paid Sick Leave when a child’s school or “place of care” experiences an unexpected closure.
The revised rules clarify that a “place of care” is not limited to formal institutions such as schools, daycare centers, or camps. It may also include informal childcare arrangements, such as babysitters, family members, or friends who provide childcare while the employee is working.
The rules further clarify that a closure may include circumstances where a childcare provider unexpectedly becomes unavailable.
- Combined PTO Policies Remain Permissible
The revised rules expressly confirm that employers may satisfy their obligations under the Ordinance through a single paid time off (“PTO”) policy rather than maintaining separate Paid Leave and Paid Sick Leave banks.
To do so, however, the policy must satisfy all Ordinance requirements, including accrual, carryover, and permissible-use provisions.
- Successor Employers Must Preserve Accrued Leave
The updated rules clarify that when employees continue working for a successor employer following a sale, merger, transfer, or other business transaction, accrued and unused leave must be preserved and transferred.
The rules further provide that liability for failing to properly transfer leave balances may extend to both the original employer and the successor employer, as well as any joint employers.
- Employers May Discipline Employees for Abuse of Paid Sick Leave
The revised rules expressly state that employers may take disciplinary action, including termination, when employees misuse Paid Sick Leave.
The rules identify several examples of potential abuse, including:
- Taking unscheduled Paid Sick Leave adjacent to weekends, holidays, vacations, or regular days off;
- Taking Paid Sick Leave after another leave request has been denied; and
- Taking Paid Sick Leave to avoid undesirable shifts or assignments.
The examples are non-exclusive and are intended to illustrate patterns of conduct that may support disciplinary action. Notably, employers may require that employees submit signed certifications affirming the use of Paid Sick Leave is for a reason permitted under the Ordinance.
Takeaways
Although the revisions largely clarify existing requirements rather than impose new obligations, employers should review their policies and practices to ensure continued compliance with the Ordinance.
If you have any questions regarding the revised rules or their impact on your business, please contact the authors of this post or your regular Saul Ewing attorney.
