Illinois Enacts Laws Codifying Disparate Impact and Requiring Jury Duty Pay

Illinois Governor JB Pritzker recently signed into law two bills that will impact employers in the state. Senate Bill (SB) 3777, the Civil Rights Safeguard Act, amends the Illinois Human Rights Act (IHRA) to codify into statute disparate impact liability under Illinois law. House Bill (HB) 4844 amends Illinois’ Jury Act, 705 ILCS 305 et seq., to mandate that employers with more than 25 employees compensate employees for the time spent serving on jury duty. Both bills were signed into law on July 31, 2026, and are discussed below.

Disparate Impact Analysis

Under a disparate impact theory, a facially neutral policy or practice may be unlawful if it disproportionally affects members of a protected group, even absent discriminatory intent, unless the respondent can satisfy the applicable statutory defense. 

Disparate impact liability has long been recognized under Title VII of the Civil Rights Act of 1964. In Griggs v. Duke Power, the United States Supreme Court held that an employer’s requirement that employees possess a high school diploma and pass certain aptitude tests violated Title VII because those requirements disproportionately excluded Black applicants and employees and were not shown to be sufficiently related to successful job performance. As the Court explained, employment practices that are neutral on their face but operate to excluded protected groups may violate antidiscrimination laws when they cannot be justified by business necessity.¹

The Civil Rights Safeguard Act codifies disparate impact under the IHRA. Specifically, the Act makes it a civil rights violation for employers, employment agencies, and labor organizations to use criteria or methods that have the effect of subjecting individuals to discrimination based on a protected characteristic, citizenship status, family responsibilities, work authorization status, arrest record, or conviction record. 

The enactment of the Civil Rights Safeguard Act appears to be, at least in part, due to the federal government’s turning away from disparate impact theory of discrimination. In April of 2025, President Trump issued Executive Order 14281, which directed federal agencies (including the EEOC) to reevaluate the use of disparate-impact theories and enforcement practices. Shortly thereafter, the EEOC sought guidance from the U.S. Department of Justice regarding the constitutionality of disparate-impact liability under Title VII.² The DOJ concluded that disparate-impact liability is constitutionally problematic when based solely on discriminatory effects without evidence of intentional discrimination, and it criticized existing EEOC disparate-impact guidance on that basis. As a result, federal agencies have substantially reduced their reliance on disparate-impact theories in enforcement actions.

As such, the EEOC has declined to investigate charges raising allegations of disparate impact discrimination, including dismissing several EEOC lawsuits or claims therein. 

Against that backdrop, Illinois lawmakers elected to expressly incorporate disparate-impact liability into the IHRA. The Act therefore preserves a state-law avenue for challenging employment practices that disproportionately affect protected groups, regardless of whether federal agencies continue to pursue such claims. Although disparate-impact claims remain available to private plaintiffs under federal law, Illinois has now provided an independent statutory basis for such claims under state law.

What are the practical takeaways for employers? 

In one sense, the Act does not create a wholly new theory of liability because disparate impact discrimination has long been recognized under Title VII following the Supreme Court’s decision in Griggs. The legislature’s expressly incorporating disparate-impact liability into the IHRA, however, can be interpreted as creating an independent state-law basis for such claims and signals commitment to preserving this theory of discrimination notwithstanding recent changes in federal enforcement priorities. 

As a practical matter, employers may see an increase in disparate impact enforcement activity from the Illinois Department of Human Rights (IDHR), which has heralded the Civil Rights Safeguard Act as “further strengthen[ing] Illinois’ role as a national leader in protecting civil rights and expanding access to opportunity.”³ If the Department assumes a more active role in pursuing disparate-impact claims, employers should take the opportunity to review employment policies and practices that rely on facially neutral criteria, including hiring requirements, screening procedures, testing criteria, promotion standards, and disciplinary policies. To the extent those practices may disproportionately affect protected groups, employers should be prepared to articulate the business necessity supporting them and consider whether less-discriminatory alternatives are available.

The Civil Rights Safeguard Act may also create unintended consequences for employers. For example, the Act makes it unlawful to use “criteria or methods . . . that have the effect of subjecting individuals to discrimination on the basis of . . . arrest record, or conviction record.”⁴ Although Illinois law already regulates the consideration of criminal history in employment decisions, the Act arguably goes a step further by extending disparate-impact protections to individuals with arrest or conviction records. While the statute does not expressly designate arrest record or conviction record as protected classes, its inclusion of those categories in the disparate-impact framework could invite challenges to employment practices that disproportionately exclude individuals with criminal histories. This issue may be particularly significant for employers that utilize criminal background screening. Because such screening practices will often have a disproportionate impact on individuals with conviction records, employers may increasingly need to rely on the Act's statutory defenses if those practices are challenged. In particular, employers should be prepared to demonstrate that any criminal-history screening criteria are job related for the position in question, consistent with business necessity, and not susceptible to a less discriminatory alternative that would serve the same business purpose.⁵

In sum, employers can take steps to avoid liability by examining their employment practices and policies to be sure they either: (1) do not have an adverse impact against any protected group; or (2) are job-related and consistent with business necessity such that no less-discriminatory alternative exists that would also serve the business necessity. For that purpose, a privileged self-audit conducted by qualified employment counsel is recommended.

Amendment of the Jury Act to Make Jury Time Compensable

HB 4844’s requirements represent a significant departure from prior Illinois law for employers with more than 25 employees. Previously, the Jury Act prohibited employers from discharging, threatening, intimidating or otherwise discriminating against employees for serving on jury duty, but expressly provided that employers were not required to compensate employees for that time. Under the amended statute, however, “[e]mployers shall be required to compensate an employee at their regular rate of pay for the time serving on jury duty.”

Given this change, beginning January 1, 2027, all employers with more than 25 employees will be required to compensate employees for time spent serving on jury duty at their regular rate of pay. The law does not define “regular rate of pay,” creating uncertainty regarding whether the phrase should be interpreted consistent with the Fair Labor Standards Act and analogous Illinois wage laws, or whether it simply refers to an employee’s standard hourly rate. 

The new law also raises questions regarding compensation for tipped employees, including whether employers may satisfy the requirement by paying the employee’s tipped rate or must instead pay the full minimum wage as required under Illinois’ Paid Leave for All Workers Act. In addition, the statute does not define “time serving on jury duty,” leaving open whether employers must compensate employees for all time spent performing jury service or only those hours that coincide with the employee’s scheduled work hours. Absent further legislative or administrative guidance, employers will likely need to navigate these issues on a case-by-case basis prior to the January 1, 2027, effective date. 

This new law also increases potential litigation exposure for covered employers. Employees who believe they have not been properly compensated for jury service may pursue individual claims, and prevailing employees may be entitled to attorneys’ fees. As a result, employers should review and update their jury-duty policies, payroll practices, and manager training before the law’s January 1, 2027, effective date to ensure compliance and reduce the risk of litigation.