Big changes are coming to the way that manufacturers in Illinois interact with temporaries and temporary labor firms. On June 1 of this year, the amended Illinois Day and Temporary Labor Act goes into effect, legally requiring manufacturers for the first time to take specific actions related to light industrial temps and their agencies.
The new Responsible Jobs Creation Act (HB690) signifies Illinois’ most far-reaching effort to date to regulate working conditions, wages and hiring practices to protect temporary labor. With nearly 800,000 temporary workers in Illinois, virtually every manufacturer doing business in Illinois will feel the impact.
What does this actually all mean? In addition to new obligations for day and temporary labor services agencies, businesses will now have significantly more direct exposure for day and temp labor services in three distinct categories:
Utilizing Only Registered Agencies
Your first concern is ensuring that the agencies you use are registered with the state. While the state has required staffing firms to register for a number of years, it is now placing the responsibility on the firm’s’ clients to ensure that they only use registered agencies. Going forward, when you initially sign a contract with an agency, you must certify the agency is on the list, and then again every year by March 1st and September 1st.
If you are using a firm that isn’t registered with the state, the Department of Labor can fine your company up to $500 per day per agency. The Illinois Department of Labor maintains a list of certified staffing firms.
Temporaries’ Training and Safety
Most companies’ process has been designed to limit co-employment and manage workers through the staffing agency. In other words, whenever possible, the agency provides direction to temps, handles the training, and any HR issues or firings. Now, in a dramatic change in process, this new law takes some of those responsibilities and squarely places them on the backs of the manufacturer specifically as it relates to training and safety.
Beginning June 1, you must have completed a job hazard analysis for every temporary position including job hazards, safety equipment, and the safety process. This must be documented and kept for three years.
Then, before the start of every assignment, it is the client company’s responsibility to provide in-person training on both job tasks, job risks, and safety measures and processes. In some fast-paced manufacturing environments where the temporary staff can change out every day, this is a notable change.
Temporary Pay Requirements and Written Notifications to Temps
The new law states the worker, “shall not be paid less than the same average rate of pay and equivalent benefits as a permanent employee of the third party client performing the same or substantially similar work.”
In addition, you are now going to be required, at least on some assignments, to provide written documentation of the hours, the location and the rate of pay for which they worked that day directly to the laborers. Again, because previous processes were designed to limit co-employment, this can be a significant change for many companies.
This documentation will need to be completed on a daily basis and you must keep copies of those documents for up to three years.
Noncompliance Can Cost You
Depending on your current setup, you may not find these process changes a particularly heavy lift. However, you still need to stay on top of it as the penalties for failing to comply can be costly. Not only do some regulations have $500/day fines, others are open to class action lawsuits by temporaries for amounts that could total as much as $500 per temp per day.
To help IMA members, over the coming months we will take a deeper dive into each of these area to help you understand how to:
- Achieve compliance on new training and safety requirements
- Comply with requirements to notify temp workers on hours
- Comply with requirements as it relates to comparable pay
- Assess your compliance readiness and tactics for ongoing diligence
Whether you are in Plant Management, Operations Management, Safety, Procurement, HR, or Compliance, be proactive. Familiarize your team with the Responsible Jobs Creation Act and get a well thought out compliance strategy in place before it goes into effect on June 1, 2018.
About the author:
John Syverson, is Managing Partner at The Gentry Partnership, a Third Party Advisory firm that helps HR and Procurement leaders save money and manage risks in their contingent workforces.