Update Applicable to:	Effective Date
All Employers Regardless of Size.	August 15, 2025

What happened?

On August 15, 2025, Illinois Governor J.B. Pritzker signed House Bill (HB) 1362, a measure amending the Illinois Service Member Employment and Reemployment Rights Act (ISERRA) to expand leave and compensation protections for service members.

Overview:

HB 1362 introduces new rights for service members to use accrued paid leave and clarifies compensation rules for public employees.

• ISERRA requires employers to reinstate employees returning from military service under the same terms as the federal USERRA. Time off under ISERRA is generally unpaid.

Additional Information:

Section 1-10 – Definitions (330 ILCS 61/1-10)

• New exclusions: “Active service” no longer includes absences to work as a military technician (dual status).

• New definition: “Orders in lieu of annual training” refers to paid active duty designated by military authority as a substitute for annual training. Employers may request documentation to verify this.

Section 1-15 – Differential Compensation (330 ILCS 61/1-15)

• Removed: Language stating that work hours extending into the next calendar day count as two workdays.

• Added: “Workdays” are now counted up to 24 continuous hours per shift. Shifts exceeding 24 hours count as an additional workday.

• Impact: Employers may need to revise how they calculate workdays for differential pay.

Section 5-5 – Basic Protections (330 ILCS 61/5-5)

• New benefit: Service members may choose to use accrued vacation, annual, or similar paid leave during active service.

• Employer restriction: Employers cannot require service members to use paid leave.

• Applies to: Both paid and unpaid active service, including travel to/from orders, rest periods before/after orders, and unpaid military service.

Section 5-10 – Additional Benefits for Public Employees (330 ILCS 61/5-10)

• (a) Concurrent Compensation – Modified
  • Public employees may receive full pay for up to 30 days of annual training or substitute orders.
  • Leave may be taken non-synchronously.
  • Combined total for both types of orders cannot exceed 30 days per calendar year.

• (b) Differential Compensation – Modified
  • Public employees may elect to use accrued paid leave instead of differential pay.
  • Differential pay for voluntary active service is capped at 60 workdays per year.
  • After 3 consecutive years of voluntary active service, entitlement to differential pay ends but is reinstated after 90 days back at work.
  • Differential pay is not available for unpaid active service (e.g., travel, rest periods, or unpaid military duty).
  • Stricken: Prior language stating differential compensation shall not be paid for active service without pay.

Source References

• Illinois HB 1362 (Public Act 104-0176) – SERVICE MEMBER EMPLOYMENT-COMP

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