Explained: Chicago Fair Workweek Regulations
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Chicago is the latest city to be hit with Fair Workweek legislation, also known as predictive scheduling law, which aims to protect workers from unfair scheduling practices. Violations include last-minute changes to schedules and assigning “clopening” shifts, where employees don’t have enough time to rest between closing and opening shifts.
As more and more US states adopt fair workweek laws, operators are bracing for the additional paperwork and risk of fines for violations. The problem for fast-food chains and restaurant operators is that the rules are complex and violations are met with heavy fines.
A case from December 2017, involving minimum wage and overtime violations, showed the tough penalties in place and the willingness of the authorities to enforce employment law. An Italian restaurant in Chicago was ordered to pay $339,000 in fines and damages after paying non-tipped trainees as little as $3.75 an hour and failing to pay time-and-a-half to employees who worked over 40 hours a week.
On January 1, 2019, Chicago City Council created a new department, The Office of Labor Standards, to “proactively investigate employers it believes could be violating labor laws”. And on July 1, 2020, new legislation comes into force with even stricter predictive scheduling laws and penalties.
The laws apply to restaurants and franchisees in Chicago with at least 30 locations and 250 employees globally, and to franchisees with four or more locations. And only to employees earning less than $26 per hour.
Among other headaches, shifts must be planned 10 days in advance (rising to 14 days after two years) and records must be immaculate to avoid costly fines. It’s especially difficult for groups operating in multiple jurisdictions, as the law varies from state to state.
The good news is, our team has been busy working on a solution to the problem. Harri’s smart scheduling tools have been developed specifically to help operators who find themselves at risk of violating the laws.
The system automatically keeps your team updated with the relevant regulations and helps managers proactively avoid fines by providing them with all the information they need in real-time as they make schedules.
The result is less stress for managers, happier workers with more flexibility and advance warning of their schedules, and ultimately a boost for your business’ bottom line – not only in terms of efficiency savings but in fines and negative press avoided.
Fair Workweek Regulations for Chicago
Let’s take a look at the rules and penalties for the Windy City and how Harri’s system deals with the many challenges they pose to operators in the city.
Good Faith Estimate
A Good Faith Estimate gives employees a clearer picture, ahead of time, of the shifts they will be expected to work. The idea is to eliminate any uncertainty and hold employers accountable for the hours they promise to new hires.
The rules say that employers must provide a Good Faith Estimate detailing:
the median number of hours the employee is expected to work each week.
whether or not they are expected to be on-call.
a subset of days and a subset of times or shifts that the employee can expect to work, or days of the week and times or shifts at which the employee will not be scheduled to work.
The employee has the right to ask the employer to modify the estimated work schedule.
Right to Rest
The aim of Right to Rest rules is to prevent employers from scheduling “clopening” shifts which don’t allow enough time for workers to rest between shifts.
The Chicago rules state that employees have the right to decline any shifts scheduled:
within 10 hours of the previous day's shift finishing.
in the 10 hours following the end of any shift spanning two days.
If an employee agrees in writing to work shifts that fall under these conditions, they must be compensated 1.5x their regular rate of pay for any such hours.
Advanced Notice on Scheduling
Advanced Scheduling rules are put into place to prevent last-minute changes to work schedules that may negatively impact workers. For example, if they have paid to travel to work, or organized child care, only to be told they are not needed at the last minute.
The rules for Chicago state that:
schedules must be provided two weeks in advance.
new employees must be included in an existing schedule with other employees.
employees have the right to decline any previously unscheduled hours that the employer adds to the schedule with less than 10 days of notice.
Predictability Pay for Schedule Changes
Predictability pay offers compensation for last-minute schedule changes. The employer must pay the following penalties, for each shift change within the 10-day notice period.
No change in the number of hours:
One hour of predictability pay.
Additional hours:
One hour of predictability pay.
Subtracted hours or shifts canceled:
One hour of predictability pay.
With less than 24 hours' notice: at least half the employee's regular hourly rate for any scheduled hours that were subtracted.
Exceptions
There are certain exceptions to the rules, which cover situations beyond the employer’s control, or that it would be unfair to penalize them for.
The above requirements don’t apply under any of the following circumstances:
Operations cannot begin or continue due to:
threats to employers, employees, or property.
civil authorities recommending that work cannot begin or continue.
failure of public utilities required for operations to continue.
acts of nature including but not limited to flood, fire, explosion, earthquake, tidal wave, drought, war, civil unrest, strikes, or a similar cause not within the employer's control.
A schedule change is the result of a mutually agreed upon shift trade or coverage arrangement between employees, subject to any existing employer policy regarding required conditions for employees to exchange shifts.
An employee requests a shift change in writing, including but limited to the use of sick leave, vacation leave, or other policies offered by the employer.
Access to Hours for Existing Employees
This part of the legislation requires the employer to give fair and reasonable access to hours for both existing and potential new employees. It lays out the rules determining how shifts are advertised so that they can be assigned fairly.
Before hiring new employees, the employer must offer any additional hours of work to existing employees.
Employees have the right to refuse this work. If they are willing to accept the additional hours, they must do so in writing.
The employer must post notice of available shifts for at least three consecutive days, unless it is critical that the work be performed within a shorter period.
The offer must be posted in a conspicuous location in the workplace where notices to employees are normally posted, or electronically on an internal website in a conspicuous location accessible to all employees.
The notice must include:
the total hours of work being offered.
the schedule of available shifts.
whether those shifts will occur at the same time each week.
the period in which the employer anticipates needing cover for the additional hours.
the process by which employees should notify the employer of their acceptance of the shift.
advice stating that an employee may accept a subset of the shifts offered.
the criteria the employer will use for the distribution of the shifts.
The employer is allowed to post the notice at the location where the shifts will be worked, at other locations, or to external candidates, at the same time.
Harri’s Intelligent Scheduling
Harri’s intelligent scheduling tools offer a number of features developed specifically to help managers schedule shifts fairly and avoid fair workweek violations.
The system automatically keeps operators up-to-date with regulations, even across multiple jurisdictions, and enables managers to proactively create schedules that comply with all the local rules. Saving them a ton of time in looking up rules as well as reducing the risk of violations and costly fines.
Here’s an overview of the features and how they protect against violations.
Good Faith Documentation
Harri’s Good Faith Documentation helps managers easily provide the required Good Faith Estimate to employees and makes the process of review and acceptance a breeze. During onboarding the Good Faith Estimate is automatically generated, providing new hires with their schedule in advance and in accordance with local laws.
The document is sent to new hires as part of the digital onboarding process for review and e-signature, avoiding the need for paper forms or an unnecessary back-and-forth correspondence. Managers save time and can be confident the document complies with the regulations.
Direct Shift Swaps
Harri’s Hot Fill system is designed to make direct shift swaps between employees easy and hands-off for the business. Allowing employees to arrange their own shift swaps enables the business to fill shifts at short notice, without incurring fees for last-minute changes.
Hot Fill - “Uber for your employees”
Here’s how the peer-to-peer exchange works:
When an employee is unable to work a shift, they use the app to release the shift.
Other employees have previously indicated they wish to work on that day if a shift becomes available (note, they are not “on-call”).
These employees are automatically alerted that a shift is available via SMS and push notification.
The first employee to accept is assigned to the shift.
The manager on duty is then notified of the employee’s distance from work and expected arrival time.
Not only does Hot Fill give more flexibility to workers, but it also allows managers to oversee shift swaps without having to spend time negotiating a back-and-forth exchange with multiple parties.
Calculation of Right to Rest Compensation Payment
In the fast-moving world of shift work, sometimes scheduling “clopening” shifts is unavoidable. When this does happen, operators must accept that they have to pay penalties. Harri helps managers to comply by alerting them in real-time if this rule is violated so they can make changes to the schedule proactively. They can then avoid “clopening” shifts and their related penalties altogether, or at least mitigate the cost by reducing the number assigned.
Manager Alert for Penalties Related to Schedule Changes
One of the hardest things for managers creating schedules is juggling all the Fair Workweek rules while also trying to take into account the needs of the restaurant and each employee. Harri’s tools allow managers to define the compensation rules for last-minute shift changes so they no longer have to constantly check the rules or try to keep this information top of mind.
Any premium pay due is indicated on the schedule and included as part of the total wage cost calculation. So managers can rest assured all the fees are being taken into account as they make scheduling decisions. And because all the data is stored in one system, it can easily be handed over to the finance department for processing.
Premium Reporting for Predictive Scheduling
The system also provides reports into all the premiums payable due to predictive scheduling laws. The detailed breakdown allows a deep-dive into how well the business is coping with the rules so that changes can be implemented for the better.
Rather than sifting through the data and typing up long documents, managers can quickly export these reports for analysis. This saves precious time and informs company-wide decision-making on scheduling policy. Maximizing cost savings by minimizing unnecessary fines.
Give Your Business a Boost with Harri’s Smart Predictive Scheduling Tools
Fair workweek laws don’t have to be a negative for your business. By taking control of predictive scheduling, you can turn it into a boost to your efficiency and staff morale.
Not only will your managers thank you, but employees on the floor will also be happy and secure in their roles, safe in the knowledge that you care about promoting fair scheduling. With compliance taken care of, your managers have more time to maximize profits for the business.
To see how much you could save in lost time and efficiency, and ultimately boost your bottom line, get started with Harri’s smart scheduling tools.
Learn more about Fair Workweek regulations in New York City and San Francisco.