Bill Text: IL HB3437 | 2021-2022 | 102nd General Assembly | Engrossed


Bill Title: Creates the Investing in Illinois Works Tax Credit Act. Provides that each owner or operator, as defined in the Illinois Hazardous Materials Workforce Training Act, may apply for a credit against withholding payments due under the Illinois Income Tax Act for each member of its skilled and trained workforce who is also a qualifying graduate. Provides limitations on the credit. Creates the Access to Apprenticeship Act. Provides that no preapprenticeship or apprenticeship program may require a recommendation from a union member or any other person as a condition of acceptance. Amends the Illinois Administrative Procedure Act and the Illinois Income Tax Act to make conforming changes. Creates the Illinois Hazardous Workforce Materials Training Act. Requires workers at high hazard facilities to obtain minimum approved safety training, provided by the Occupational and Safety Health Administration, and to file a certificate of completion with the Department of Labor. Contains enforcement provisions. Provides that the Act does not apply to any owner or operator that has an executed national or local labor agreement in effect pertaining to the performance of construction work at a given facility or site under the terms of the agreement. Requires applicable apprenticeship and training programs, approved by and registered with the U.S. Department of Labor's Office of Apprenticeship, providing minimum approved safety training for workers in high hazard facilities and contractors employing workers at high hazard facilities to file an annual report with the Department and the Illinois Works Review Panel. Provides that an owner or operator who violates the requirements of the Act shall be subject to a minimum civil penalty of $10,000 for each violation. Requires all moneys received by the Department as fees and civil penalties under the Act to be deposited into the Illinois Works Fund to be used to recruit, prescreen, and provide preapprenticeship skills training. Contains other provisions. Effective January 1, 2022.

Spectrum: Partisan Bill (Democrat 45-1)

Status: (Engrossed) 2021-07-16 - Senate Floor Amendment No. 2 Pursuant to Senate Rule 3-9(b) / Referred to Assignments [HB3437 Detail]

Download: Illinois-2021-HB3437-Engrossed.html



HB3437 EngrossedLRB102 14622 CPF 19975 b
1 AN ACT concerning safety.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4
ARTICLE 1. INVESTING IN ILLINOIS WORKS TAX CREDIT ACT
5 Section 1-1. Short title. This Article may be cited as the
6Investing in Illinois Works Tax Credit Act. References in this
7Article to "this Act" mean this Article.
8 Section 1-3. Legislative findings. The General Assembly
9finds that:
10 Economic research indicates that registered apprenticeship
11programs have positive economic impacts, and countries with
12more widespread usage of apprenticeship programs have shown to
13be more successful at transitioning young workers into stable
14jobs, resulting in lower youth unemployment rates.
15 The demographics of registered apprenticeship programs in
16our State do not mirror the diversity of Illinoisans.
17According to data from the U.S. Department of Labor's Office
18of Apprenticeship, from 2000 through 2016, only 8.8% of all
19construction apprentices were African-American, 17.6% were
20Hispanic or Latino/Latina, while 69.6% were white.
21 In order to work toward a level playing field for all who
22seek the training and economic stability apprenticeships

HB3437 Engrossed- 2 -LRB102 14622 CPF 19975 b
1provide, Illinois created the Illinois Works Preapprenticeship
2Program, which funds preapprenticeship skills training through
3community-based organizations serving populations that have,
4historically, been met with barriers to entry or advancement
5in the workforce.
6 By targeting historically underutilized communities whose
7members seek to access the upward mobility and career
8advancement apprenticeships bring, the Illinois Works
9Preapprenticeship Program is one part of many State
10initiatives to increase diversity in apprenticeship programs
11and careers in the construction and building trades.
12 The Investing in Illinois Works Tax Credit expands the
13goals of the Illinois Works Preapprenticeship Program to
14private construction projects and highly skilled training
15programs by incentivizing contractors to utilize graduates of
16the Illinois Works Preapprenticeship Program or graduates of
17the U.S. Department of Labor's Office of Apprenticeship as
18part of their skilled and trained workforces on projects at
19high-hazard facilities.
20 Section 1-5. Definitions. As used in this Act:
21 "Apprenticeship program" has the same meaning as provided
22in Section 10-5 of the Illinois Hazardous Materials Workforce
23Training Act.
24 "Department" means the Department of Commerce and Economic
25Opportunity.

HB3437 Engrossed- 3 -LRB102 14622 CPF 19975 b
1 "Illinois Works Preapprenticeship Program" means a network
2of community-based, nonprofit organizations throughout
3Illinois that receive grant funding from the Illinois
4Department of Commerce and Economic Opportunity to recruit,
5pre-screen, and provide preapprenticeship skill training to
6create a qualified, diverse pipeline of workers who are
7prepared for careers in the construction and building trades
8as prescribed in Section 20-15 of the Illinois Works Jobs
9Program Act.
10 "Inflation adjustment" means for any calendar year the
11percentage, if any, by which the Consumer Price Index for All
12Urban Consumers, as issued by the United States Department of
13Labor, for the preceding calendar year exceeds the Consumer
14Price Index for All Urban Consumers for calendar year 2021.
15 "Owner or operator" has the meaning provided in Section 5
16of the Illinois Hazardous Materials Workforce Training Act.
17 "Qualifying employee" means a qualifying graduate who was
18continuously employed by the owner or operator, or a
19contractor employed by the owner or operator, in Illinois
20during all 4 reporting periods occurring in the calendar year
21directly preceding the calendar year in which the credit is
22claimed.
23 "Qualifying graduate" means an individual from an
24underrepresented population who has successfully completed a
25preapprenticeship program through the Illinois Works
26Preapprenticeship Program in compliance with the requirements

HB3437 Engrossed- 4 -LRB102 14622 CPF 19975 b
1of Section 20-15 of the Illinois Works Jobs Programs Act and
2who is a registered apprentice as defined under Section 10-5
3of the Illinois Hazardous Materials Workforce Training Act or
4has successfully completed an apprenticeship program approved
5by and registered with the United States Department of Labor's
6Office of Apprenticeship.
7 "Reporting period" means the quarter for which a return is
8required to be filed under subsection (b) of Section 704A of
9the Illinois Income Tax Act.
10 "Skilled and trained workforce" has the same meaning
11provided in Section 10-5 of the Illinois Hazardous Materials
12Workforce Training Act.
13 "Tax credit certificate" means the certificate awarded by
14the Department pursuant to Section 1-20 of this Act.
15 "Underrepresented population" has the meaning provided in
16Section 20-10 of the Illinois Works Job Program Act.
17 Section 1-10. Credit amount. For reporting periods
18beginning on or after January 1, 2022, subject to the
19limitations provided in this Act, an owner or operator may
20claim as a credit against the tax imposed under Section 704A of
21the Illinois Income Tax Act an amount equal to $2,500 for each
22qualifying employee, plus any applicable inflation adjustment,
23as certified by the Department on a tax credit certificate
24awarded pursuant to this Act.

HB3437 Engrossed- 5 -LRB102 14622 CPF 19975 b
1 Section 1-15. Application process.
2 (a) An owner or operator may apply to the Department for a
3certificate to receive a credit under Section 1-10.
4 (b) The Department shall establish an application process
5to certify an owner or operator for the credit under Section
61-10 as necessary for implementation of this Act. As part of
7the application process, the Department shall require the
8owner or operator to provide:
9 (1) the name, year, and community-based organization
10 or union through which each qualifying employee completed
11 his or her Illinois Works Preapprenticeship Program or
12 apprenticeship program;
13 (2) the certificate of completion from the Department
14 of Labor that the qualifying employee has completed the
15 minimum approved safety training required by the Illinois
16 Hazardous Materials Workforce Training Act;
17 (3) the hours worked by the qualifying employee that
18 go to meeting his or her apprenticeship requirements at
19 the time of the application;
20 (4) a signed affidavit from the owner or operator
21 attesting that: (i) the qualifying employee was employed
22 by the owner and operator or a contractor reemployed by
23 the owner or operator during all 4 reporting periods
24 occurring during the calendar year preceding the calendar
25 year in which the credit will be applied; (ii) the
26 qualifying employee performed work in his or her

HB3437 Engrossed- 6 -LRB102 14622 CPF 19975 b
1 prevailing wage classification for the duration of his or
2 her employment in the calendar year preceding the calendar
3 year in which the credit will be applied; (iii) the
4 documents provided in the application are true; and (iv)
5 the owner or operator will comply with all applicable
6 laws; and
7 (5) any other material required by the Department.
8 Section 1-20. Credit awards.
9 (a) Upon satisfactory review, the Department shall issue a
10tax credit certificate stating the amount of the tax credit to
11which an owner or operator is entitled under this Act. Each
12certificate shall include a unique identifying number. The
13credit shall be claimed for the first reporting period
14beginning on or after the date on which the certificate is
15issued by the Department. The credit shall be equal to the
16amount shown on the certificate but may not reduce the
17taxpayer's obligation for any payment due under Section 704A
18of the Illinois Income Tax Act to less than zero. If the amount
19of the credit exceeds the total payments due under this
20Section with respect to amounts withheld during the reporting
21period, the excess may be carried forward and applied against
22the taxpayer's liability under Section 704A of the Illinois
23Income Tax Act in the 5 succeeding calendar years. The credit
24shall be applied to the earliest reporting period for which
25there is a tax liability. If there are credits from more than

HB3437 Engrossed- 7 -LRB102 14622 CPF 19975 b
1one reporting period that are available to offset a liability,
2the earlier credit shall be applied first. No credit awarded
3under this Act shall be sold or otherwise transferred.
4 (b) This Section is exempt from the provisions of Section
5250 of the Illinois Income Tax Act.
6 (c) The Department shall award not more than an aggregate
7of $20,000,000 in total annual tax credits pursuant to this
8Act, increased annually by any applicable inflation
9adjustment. If applications for a greater amount are received,
10credits shall be allowed on a first-come, first-served basis
11based on the date on which each properly completed application
12for certification is received by the Department. If more than
13one properly completed application for certification is
14received on the same day, the credits shall be awarded based on
15the time of submission for that particular day.
16 Section 1-25. Penalties; recapture.
17 (a) False or fraudulent claims for credits under this Act
18may be subject to penalties as provided under Sections 3-5 or
193-6 of the Uniform Penalty and Interest Act, as applicable.
20 (b) If the Department determines that an owner or operator
21who has received a credit under this Act does not comply with
22the requirements of this Act or that a certification the owner
23or operator made in his or her application are false, the
24Department may initiate recapture procedures against the owner
25or operator and, after notice and an opportunity for hearing,

HB3437 Engrossed- 8 -LRB102 14622 CPF 19975 b
1recapture the entire credit amount awarded pursuant to any tax
2credit certificate under issued under this Act. The Department
3shall notify the Department of Revenue of any credits
4recaptured pursuant to this subsection.
5 (c) If a previously awarded credit is required to be
6recaptured under subsection (b), the owner or operator shall
7increase the next withholding payment required under Section
8704A of the Illinois Income Tax Act by the amount of the
9recaptured credit.
10 Section 1-30. Rulemaking. The Department shall adopt rules
11for the implementation and administration of this Act. In
12order to provide for the expeditious and timely implementation
13of this Act, the Department, the Department of Labor, and the
14Department of Revenue may adopt emergency rules. The adoption
15of emergency rules authorized by this Section is deemed to be
16necessary for the public interest, safety, and welfare.
17
ARTICLE 5. ACCESS TO APPRENTICESHIP ACT
18 Section 5-1. Short title. This Article may be cited as the
19Access to Apprenticeship Act. References in this Article to
20"this Act" mean this Article.
21 Section 5-5. Restrictions on application requirements.
22Notwithstanding any law to the contrary, in order to ensure

HB3437 Engrossed- 9 -LRB102 14622 CPF 19975 b
1fair and equal access to apprenticeship programs, no
2application for a preapprenticeship or apprenticeship program,
3whether run by the State, a community-based organization, a
4community college, a public university, a private employer, a
5union, or joint labor-management program, may require a
6recommendation from a union member or any other person as a
7condition of acceptance to the preapprenticeship or
8apprenticeship program. An intent to hire letter from a
9signatory contractor shall not be considered a recommendation
10for purposes of this Act.
11 Section 5-97. Severability. The provisions of this Act are
12severable under Section 1.31 of the Statute on Statutes.
13
ARTICLE 10. ILLINOIS HAZARDOUS MATERIALS WORKFORCE TRAINING
14
ACT
15 Section 10-1. Short title. This Article may be cited as
16the Illinois Hazardous Materials Workforce Training Act.
17References in this Article to "this Act" mean this Article.
18 Section 10-5. Definitions. As used in this Act:
19 "Apprenticeable occupation" means an occupation in the
20building and construction trades for which training and
21apprenticeship programs have been approved by and registered
22with the U.S. Department of Labor's Office of Apprenticeship.

HB3437 Engrossed- 10 -LRB102 14622 CPF 19975 b
1 "Apprenticeship program" means an applicable training and
2apprenticeship program approved by and registered with the
3U.S. Department of Labor's Office of Apprenticeship.
4 "Building and construction trades council" means any labor
5organization that represents multiple construction trades and
6monitors or is attentive to compliance with public or workers'
7safety laws, wage and hour requirements, or other statutory
8requirements and negotiates and maintains collective
9bargaining agreements.
10 "Construction" means all work at a stationary source
11involving laborers, workers, or mechanics, including any
12maintenance, repair, assembly, or disassembly work performed
13on equipment whether owned, leased, or rented.
14 "Department" means the Department of Labor.
15 "Director" means the Director of Labor.
16 "Labor agreement" means a form of prehire collective
17bargaining agreement covering all terms and conditions of
18employment.
19 "Labor organization" means an organization that is the
20exclusive representative of an employer's employees recognized
21or certified under the federal National Labor Relations Act of
221935.
23 "Minimum approved safety training for workers at high
24hazard facilities" means a minimum 30-hour OSHA Outreach
25Training Program for the Construction class consisting of a
26curriculum of OSHA-designated training topics with training

HB3437 Engrossed- 11 -LRB102 14622 CPF 19975 b
1performed by an authorized OSHA Outreach Training Program
2Trainer and that is intended to provide workers with
3information about their rights, employer responsibilities,
4safety and health hazards a worker may encounter on a work
5site, as well as how to identify, abate, avoid, and prevent
6job-related hazards by emphasizing hazard identification,
7avoidance, control, and prevention.
8 "OSHA" means the United States Department of Labor's
9Occupational Safety and Health Administration.
10 "Owner or operator" means an owner or operator of a
11stationary source that is engaged in activities described in
12Code 324110, 325110, 325193, or 325199 of the 2017 North
13American Industry Classification System (NAICS), and has one
14or more covered processes that are required to prepare and
15submit a Risk Management Plan. "Owner or operator" does not
16include oil and gas extraction operations.
17 "Prevailing hourly wage rate" has the same meaning as
18"general prevailing rate of hourly wages" as defined in
19Section 2 of the Prevailing Wage Act.
20 "Registered apprentice" means an apprentice registered in
21an applicable apprenticeship program for an apprenticeable
22occupation approved by and registered with the U.S. Department
23of Labor's Office of Apprenticeship.
24 "Shift" means a set standard period of time an employer
25requires its employees to perform his or her work-related
26duties on a daily basis. For purposes of this definition,

HB3437 Engrossed- 12 -LRB102 14622 CPF 19975 b
1there may be multiple shifts per day.
2 "Skilled journeyperson" means a worker who meets all of
3the following criteria:
4 (1) the worker either graduated from an approved
5 apprenticeship and training program approved by and
6 registered with the U.S. Department of Labor's Office of
7 Apprenticeship for the applicable occupation, or has at
8 least as many hours of on-the-job experience in the
9 applicable occupation that would be required to graduate
10 from an apprenticeship program approved by and registered
11 with the U.S. Department of Labor's Office of
12 Apprenticeship for the applicable occupation;
13 (2) the worker is being paid at least a rate
14 equivalent to the prevailing hourly wage rate for a
15 journeyperson in the applicable occupation and locality;
16 and
17 (3) beginning on or after July 1, 2024, the worker has
18 completed, within the prior 3 calendar years, minimum
19 approved safety training for workers at high hazard
20 facilities and has filed a certificate of completion with
21 the Department.
22 "Skilled and trained workforce" means a workforce that
23meets all of the following criteria:
24 (1) all the workers are either registered apprentices
25 or skilled journeypersons;
26 (2) beginning on July 1, 2022, at least 45% of the

HB3437 Engrossed- 13 -LRB102 14622 CPF 19975 b
1 skilled journeypersons are graduates of an apprenticeship
2 program for the applicable occupation;
3 (3) beginning on July 1, 2023, at least 60% of the
4 skilled journeypersons are graduates of an apprenticeship
5 program for the applicable occupation; and
6 (4) beginning on July 1, 2024, at least 80% of the
7 skilled journeypersons are graduates of an apprenticeship
8 program for the applicable occupation.
9 "Stationary source" means that term as it is defined under
10Section 39.5 of the Environmental Protection Act.
11 Section 10-10. Minimum approved safety training.
12 (a) A person who has completed minimum approved safety
13training for workers at high hazard facilities shall file his
14or her certificate of completion with the Department in a
15manner prescribed by the Department.
16 (b) The owner or operator, when contracting for the
17performance of construction work at the stationary source,
18shall require that its contractors and any subcontractors use
19a skilled and trained workforce to perform all onsite work
20within an apprenticeable occupation in the building and
21construction trades.
22 (c) The requirements of this Section shall not immediately
23apply to contracts awarded before July 1, 2022, unless the
24contract is extended or renewed after that date. Contracts
25awarded before July 1, 2022 shall meet the requirements of

HB3437 Engrossed- 14 -LRB102 14622 CPF 19975 b
1this Section no later than July 1, 2023.
2 (d) The requirements of this Section shall only apply to
3the skilled and trained workforce, contracted with an owner or
4operator to perform construction work at the stationary source
5site.
6 (e) The skilled and trained workforce requirements under
7this Section shall not apply to:
8 (1) Contractors that have requested qualified workers
9 from the local hiring halls that dispatch workers in the
10 apprenticeable occupation and, due to workforce shortages,
11 the contractor is unable to obtain sufficient qualified
12 workers within 48 hours of the request, Saturdays,
13 Sundays, and holidays excepted. This Act shall not prevent
14 contractors from obtaining workers from any source.
15 (2) An emergency where compliance is impracticable;
16 namely, an emergency requires immediate action to prevent
17 imminent harm to public health or safety or to the
18 environment. Within 14 days of an emergency, the Illinois
19 Department of Labor must certify that the emergency
20 warranted noncompliance with this Act. The employer must
21 provide necessary documentation of the emergency to the
22 Illinois Department of Labor.
23 Section 10-15. Enforcement. Any interested party may file
24a complaint with the Department of Labor against an owner,
25operator, or construction contractor covered under this Act if

HB3437 Engrossed- 15 -LRB102 14622 CPF 19975 b
1there is reasonable belief that the owner, operator, or
2construction contractor is in violation of this Act. Upon
3receiving the complaint, the Department of Labor shall request
4a copy of any contract at issue that was entered into between
5the owner, operator, or construction contractor to ensure that
6training requirements under this Act were included in the
7contract's terms. The Department of Labor shall request from
8the construction contractor a copy of the construction
9contractor's payroll, broken down by any registered apprentice
10and skilled journeyperson on the job site. If the Department
11of Labor finds that an owner, operator, or construction
12contractor has not complied with this Act, the Department
13shall refer the matter to the Attorney General for
14enforcement.
15 Section 10-20. Exemptions. This Act does not apply to any
16owner or operator that has an executed national or local labor
17agreement in effect pertaining to the performance of
18construction work at a given facility or site under the terms
19of the agreement. The labor agreement must be negotiated with
20and approved by a local building and construction trades
21council that has geographic jurisdiction over the stationary
22source.
23 Section 10-21. Reporting.
24 (a) Any applicable apprenticeship and training program

HB3437 Engrossed- 16 -LRB102 14622 CPF 19975 b
1approved by and registered with the U.S. Department of Labor's
2Office of Apprenticeship providing minimum approved safety
3training for workers in high hazard facilities and any
4contractor who employs workers operating at high hazard
5facilities shall file an annual report with the Department and
6the Illinois Works Review Panel, in the form and manner
7required by the Department, within 6 months after the
8effective date of this Act and on January 31 of each year
9thereafter. The report shall contain the following
10information:
11 (1) A description of the applicable apprenticeship and
12 training program, approved by and registered with the U.S.
13 Department of Labor's Office of Apprenticeship, or the
14 contractor's recruitment efforts, screening efforts, and a
15 general description of training efforts.
16 (2) The applicable apprenticeship and training
17 program, approved by and registered with the U.S.
18 Department of Labor's Office of Apprenticeship, shall
19 provide the number of individuals who apply to,
20 participate in, and complete the minimum approved safety
21 training for workers at high hazard facilities, broken
22 down by race, gender, jurisdiction, age, and veteran
23 status. A contractor under this paragraph shall provide
24 the number of workers who the contractor employs to work
25 at high hazard facilities, within the last calendar year,
26 broken down by race, gender, jurisdiction, age, and

HB3437 Engrossed- 17 -LRB102 14622 CPF 19975 b
1 veteran status.
2 (3) The demographic data of the jurisdiction.
3 (4) For the applicable apprenticeship and training
4 program, approved by and registered with the U.S.
5 Department of Labor's Office of Apprenticeship, a
6 statement of the minimum diversity goal that participation
7 in the minimum approved safety training for workers in
8 high hazard facilities is equal to the demographics of its
9 jurisdiction. For a contractor under this paragraph, a
10 statement of the minimum diversity goal that the workers
11 employed by the contractor to work at high hazard
12 facilities are equal to of the demographics of the
13 contractor's jurisdiction.
14 (5) An action plan to increase diversity and meet or
15 exceed the stated minimum diversity goal, inclusive of,
16 but not limited to, the following actions if the diversity
17 goal is not met:
18 (A) Providing information on this Act for all high
19 schools and field offices of the Department of
20 Employment Security in the jurisdiction.
21 (B) Entering into a joint agreement with the
22 Department of Employment Security for outreach and
23 employment.
24 (C) Entering into a joint agreement with
25 educational institutions or approved Illinois Works
26 Preapprenticeship Programs established under

HB3437 Engrossed- 18 -LRB102 14622 CPF 19975 b
1 subsection (a) of Section 20-15 of the Illinois Works
2 Jobs Program Act in the jurisdiction to enhance
3 recruitment efforts.
4 (D) Eliminating experience requirements, when
5 feasible, to permit increased participation by
6 minorities.
7 (b) If the Department and the Illinois Works Review Panel
8conclude that the report submitted under this Section does not
9meet or is unlikely to meet the minimum diversity goal under
10paragraph (4) of subsection (a) within 12 months after filing
11its report, or that the action plan was not followed, the
12Department and the Illinois Works Review Panel shall recommend
13that the action plan be revised to provide additional steps
14and opportunities for minority participation.
15 (c) An applicable apprenticeship and training program,
16approved by and registered with the U.S. Department of Labor's
17Office of Apprenticeship, providing workers in a high hazard
18facility or a contractor operating at high hazard facility
19shall be deemed unfit to provide workers or operate at high
20hazard facilities and may be subject to a penalty of up to one
21year's prohibition from providing workers or operating at high
22hazard facilities. If the Department and the Illinois Works
23Review Panel conclude that the applicable apprenticeship and
24training program, approved by and registered with the U.S.
25Department of Labor's Office of Apprenticeship, providing
26workers in a high hazard facility or the contractor operating

HB3437 Engrossed- 19 -LRB102 14622 CPF 19975 b
1at a high hazard facility failed to follow its action plan
2under paragraph (5) of subsection (a) or the recommendations
3to its action plan provided by the Department and the Illinois
4Works Review Panel under subsection (b) within 12 months after
5filing the entity's report, then the applicable apprenticeship
6and training program or contractor shall be deemed unfit to
7provide workers or operate at high hazard facilities and may
8be subject to a penalty of up to one year's prohibition from
9providing workers or operating at high hazard facilities.
10 (d) For reporting purposes, the jurisdiction is the
11Illinois county where the applicable apprenticeship and
12training program, approved by and registered with the U.S.
13Department of Labor's Office of Apprenticeship, is located.
14For a contractor, the jurisdiction is the county where the
15contractor's workers perform the majority of work in a high
16hazard facility within the last calendar year.
17 Section 10-25. Penalties; noncompliant reporting;
18reinstatement.
19 (a) Except as provided in subsection (b), an owner or
20operator who violates the requirements of this Act shall be
21subject to a minimum civil penalty of $10,000 for each
22violation. Each shift a violation of this Act occurs shall be
23considered a separate violation. The penalty may be recovered
24in a civil action brought by the Director in any circuit court.
25In the civil action, the Director shall be represented by the

HB3437 Engrossed- 20 -LRB102 14622 CPF 19975 b
1Attorney General. All moneys received by the Department as
2fees and civil penalties under this Act shall be deposited
3into the Illinois Works Fund to be used to recruit, prescreen,
4and provide preapprenticeship skills training for which
5participants may attend free of charge and receive a stipend
6to create a qualified, diverse pipeline of workers who are
7prepared to work in high hazard facilities.
8 (b) Notwithstanding subsection (a), if the Department and
9the Illinois Works Review Panel determine that there is a
10violation of Section 10-21, the Department and the Illinois
11Works Review Panel shall provide reasonable notice of
12noncompliance to the violator within 90 days after the
13violation and inform the violator that the violator has 45
14days to comply with Section 10-21 without penalty. If the
15noncompliance is not remedied, the violator may be deemed
16unfit to provide workers or operate at high hazard facilities
17for a period of up to one year. If the Department and the
18Illinois Works Review Panel determine that the violator has
19remedied the violation and is in compliance with Section
2010-21, the Department shall have 45 days to reinstate the
21authorization for the violator to provide workers or operate
22at high hazard facilities. The Department and the Illinois
23Works Review Panel may not unreasonably withhold reinstatement
24under this subsection when the applicable apprenticeship and
25training program, approved by and registered with the U.S.
26Department of Labor's Office of Apprenticeship, providing

HB3437 Engrossed- 21 -LRB102 14622 CPF 19975 b
1workers in high hazard facilities or the contractor operating
2at high hazard facilities is found to be in compliance with
3Section 10-21.
4 Section 10-97. Severability. The provisions of this Act
5are severable under Section 1.31 of the Statute on Statutes.
6
ARTICLE 15. AMENDATORY PROVISIONS
7 Section 15-5. The Illinois Administrative Procedure Act is
8amended by adding Section 5-45.8 as follows:
9 (5 ILCS 100/5-45.8 new)
10 Sec. 5-45.8. Emergency rulemaking. To provide for the
11expeditious and timely implementation of this amendatory Act
12of the 102nd General Assembly, the Department of Commerce and
13Economic Opportunity shall, and the Department of Labor and
14the Department of Revenue may, adopt emergency rules. The
15adoption of emergency rules authorized by this Section is
16deemed to be necessary for the public interest, safety, and
17welfare.
18 This Section is repealed on January 1, 2026.
19 Section 15-10. The Illinois Income Tax Act is amended by
20changing Section 704A as follows:

HB3437 Engrossed- 22 -LRB102 14622 CPF 19975 b
1 (35 ILCS 5/704A)
2 Sec. 704A. Employer's return and payment of tax withheld.
3 (a) In general, every employer who deducts and withholds
4or is required to deduct and withhold tax under this Act on or
5after January 1, 2008 shall make those payments and returns as
6provided in this Section.
7 (b) Returns. Every employer shall, in the form and manner
8required by the Department, make returns with respect to taxes
9withheld or required to be withheld under this Article 7 for
10each quarter beginning on or after January 1, 2008, on or
11before the last day of the first month following the close of
12that quarter.
13 (c) Payments. With respect to amounts withheld or required
14to be withheld on or after January 1, 2008:
15 (1) Semi-weekly payments. For each calendar year, each
16 employer who withheld or was required to withhold more
17 than $12,000 during the one-year period ending on June 30
18 of the immediately preceding calendar year, payment must
19 be made:
20 (A) on or before each Friday of the calendar year,
21 for taxes withheld or required to be withheld on the
22 immediately preceding Saturday, Sunday, Monday, or
23 Tuesday;
24 (B) on or before each Wednesday of the calendar
25 year, for taxes withheld or required to be withheld on
26 the immediately preceding Wednesday, Thursday, or

HB3437 Engrossed- 23 -LRB102 14622 CPF 19975 b
1 Friday.
2 Beginning with calendar year 2011, payments made under
3 this paragraph (1) of subsection (c) must be made by
4 electronic funds transfer.
5 (2) Semi-weekly payments. Any employer who withholds
6 or is required to withhold more than $12,000 in any
7 quarter of a calendar year is required to make payments on
8 the dates set forth under item (1) of this subsection (c)
9 for each remaining quarter of that calendar year and for
10 the subsequent calendar year.
11 (3) Monthly payments. Each employer, other than an
12 employer described in items (1) or (2) of this subsection,
13 shall pay to the Department, on or before the 15th day of
14 each month the taxes withheld or required to be withheld
15 during the immediately preceding month.
16 (4) Payments with returns. Each employer shall pay to
17 the Department, on or before the due date for each return
18 required to be filed under this Section, any tax withheld
19 or required to be withheld during the period for which the
20 return is due and not previously paid to the Department.
21 (d) Regulatory authority. The Department may, by rule:
22 (1) Permit employers, in lieu of the requirements of
23 subsections (b) and (c), to file annual returns due on or
24 before January 31 of the year for taxes withheld or
25 required to be withheld during the previous calendar year
26 and, if the aggregate amounts required to be withheld by

HB3437 Engrossed- 24 -LRB102 14622 CPF 19975 b
1 the employer under this Article 7 (other than amounts
2 required to be withheld under Section 709.5) do not exceed
3 $1,000 for the previous calendar year, to pay the taxes
4 required to be shown on each such return no later than the
5 due date for such return.
6 (2) Provide that any payment required to be made under
7 subsection (c)(1) or (c)(2) is deemed to be timely to the
8 extent paid by electronic funds transfer on or before the
9 due date for deposit of federal income taxes withheld
10 from, or federal employment taxes due with respect to, the
11 wages from which the Illinois taxes were withheld.
12 (3) Designate one or more depositories to which
13 payment of taxes required to be withheld under this
14 Article 7 must be paid by some or all employers.
15 (4) Increase the threshold dollar amounts at which
16 employers are required to make semi-weekly payments under
17 subsection (c)(1) or (c)(2).
18 (e) Annual return and payment. Every employer who deducts
19and withholds or is required to deduct and withhold tax from a
20person engaged in domestic service employment, as that term is
21defined in Section 3510 of the Internal Revenue Code, may
22comply with the requirements of this Section with respect to
23such employees by filing an annual return and paying the taxes
24required to be deducted and withheld on or before the 15th day
25of the fourth month following the close of the employer's
26taxable year. The Department may allow the employer's return

HB3437 Engrossed- 25 -LRB102 14622 CPF 19975 b
1to be submitted with the employer's individual income tax
2return or to be submitted with a return due from the employer
3under Section 1400.2 of the Unemployment Insurance Act.
4 (f) Magnetic media and electronic filing. With respect to
5taxes withheld in calendar years prior to 2017, any W-2 Form
6that, under the Internal Revenue Code and regulations
7promulgated thereunder, is required to be submitted to the
8Internal Revenue Service on magnetic media or electronically
9must also be submitted to the Department on magnetic media or
10electronically for Illinois purposes, if required by the
11Department.
12 With respect to taxes withheld in 2017 and subsequent
13calendar years, the Department may, by rule, require that any
14return (including any amended return) under this Section and
15any W-2 Form that is required to be submitted to the Department
16must be submitted on magnetic media or electronically.
17 The due date for submitting W-2 Forms shall be as
18prescribed by the Department by rule.
19 (g) For amounts deducted or withheld after December 31,
202009, a taxpayer who makes an election under subsection (f) of
21Section 5-15 of the Economic Development for a Growing Economy
22Tax Credit Act for a taxable year shall be allowed a credit
23against payments due under this Section for amounts withheld
24during the first calendar year beginning after the end of that
25taxable year equal to the amount of the credit for the
26incremental income tax attributable to full-time employees of

HB3437 Engrossed- 26 -LRB102 14622 CPF 19975 b
1the taxpayer awarded to the taxpayer by the Department of
2Commerce and Economic Opportunity under the Economic
3Development for a Growing Economy Tax Credit Act for the
4taxable year and credits not previously claimed and allowed to
5be carried forward under Section 211(4) of this Act as
6provided in subsection (f) of Section 5-15 of the Economic
7Development for a Growing Economy Tax Credit Act. The credit
8or credits may not reduce the taxpayer's obligation for any
9payment due under this Section to less than zero. If the amount
10of the credit or credits exceeds the total payments due under
11this Section with respect to amounts withheld during the
12calendar year, the excess may be carried forward and applied
13against the taxpayer's liability under this Section in the
14succeeding calendar years as allowed to be carried forward
15under paragraph (4) of Section 211 of this Act. The credit or
16credits shall be applied to the earliest year for which there
17is a tax liability. If there are credits from more than one
18taxable year that are available to offset a liability, the
19earlier credit shall be applied first. Each employer who
20deducts and withholds or is required to deduct and withhold
21tax under this Act and who retains income tax withholdings
22under subsection (f) of Section 5-15 of the Economic
23Development for a Growing Economy Tax Credit Act must make a
24return with respect to such taxes and retained amounts in the
25form and manner that the Department, by rule, requires and pay
26to the Department or to a depositary designated by the

HB3437 Engrossed- 27 -LRB102 14622 CPF 19975 b
1Department those withheld taxes not retained by the taxpayer.
2For purposes of this subsection (g), the term taxpayer shall
3include taxpayer and members of the taxpayer's unitary
4business group as defined under paragraph (27) of subsection
5(a) of Section 1501 of this Act. This Section is exempt from
6the provisions of Section 250 of this Act. No credit awarded
7under the Economic Development for a Growing Economy Tax
8Credit Act for agreements entered into on or after January 1,
92015 may be credited against payments due under this Section.
10 (h) An employer may claim a credit against payments due
11under this Section for amounts withheld during the first
12calendar year ending after the date on which a tax credit
13certificate was issued under Section 35 of the Small Business
14Job Creation Tax Credit Act. The credit shall be equal to the
15amount shown on the certificate, but may not reduce the
16taxpayer's obligation for any payment due under this Section
17to less than zero. If the amount of the credit exceeds the
18total payments due under this Section with respect to amounts
19withheld during the calendar year, the excess may be carried
20forward and applied against the taxpayer's liability under
21this Section in the 5 succeeding calendar years. The credit
22shall be applied to the earliest year for which there is a tax
23liability. If there are credits from more than one calendar
24year that are available to offset a liability, the earlier
25credit shall be applied first. This Section is exempt from the
26provisions of Section 250 of this Act.

HB3437 Engrossed- 28 -LRB102 14622 CPF 19975 b
1 (i) Each employer with 50 or fewer full-time equivalent
2employees during the reporting period may claim a credit
3against the payments due under this Section for each qualified
4employee in an amount equal to the maximum credit allowable.
5The credit may be taken against payments due for reporting
6periods that begin on or after January 1, 2020, and end on or
7before December 31, 2027. An employer may not claim a credit
8for an employee who has worked fewer than 90 consecutive days
9immediately preceding the reporting period; however, such
10credits may accrue during that 90-day period and be claimed
11against payments under this Section for future reporting
12periods after the employee has worked for the employer at
13least 90 consecutive days. In no event may the credit exceed
14the employer's liability for the reporting period. Each
15employer who deducts and withholds or is required to deduct
16and withhold tax under this Act and who retains income tax
17withholdings under this subsection must make a return with
18respect to such taxes and retained amounts in the form and
19manner that the Department, by rule, requires and pay to the
20Department or to a depositary designated by the Department
21those withheld taxes not retained by the employer.
22 For each reporting period, the employer may not claim a
23credit or credits for more employees than the number of
24employees making less than the minimum or reduced wage for the
25current calendar year during the last reporting period of the
26preceding calendar year. Notwithstanding any other provision

HB3437 Engrossed- 29 -LRB102 14622 CPF 19975 b
1of this subsection, an employer shall not be eligible for
2credits for a reporting period unless the average wage paid by
3the employer per employee for all employees making less than
4$55,000 during the reporting period is greater than the
5average wage paid by the employer per employee for all
6employees making less than $55,000 during the same reporting
7period of the prior calendar year.
8 For purposes of this subsection (i):
9 "Compensation paid in Illinois" has the meaning ascribed
10to that term under Section 304(a)(2)(B) of this Act.
11 "Employer" and "employee" have the meaning ascribed to
12those terms in the Minimum Wage Law, except that "employee"
13also includes employees who work for an employer with fewer
14than 4 employees. Employers that operate more than one
15establishment pursuant to a franchise agreement or that
16constitute members of a unitary business group shall aggregate
17their employees for purposes of determining eligibility for
18the credit.
19 "Full-time equivalent employees" means the ratio of the
20number of paid hours during the reporting period and the
21number of working hours in that period.
22 "Maximum credit" means the percentage listed below of the
23difference between the amount of compensation paid in Illinois
24to employees who are paid not more than the required minimum
25wage reduced by the amount of compensation paid in Illinois to
26employees who were paid less than the current required minimum

HB3437 Engrossed- 30 -LRB102 14622 CPF 19975 b
1wage during the reporting period prior to each increase in the
2required minimum wage on January 1. If an employer pays an
3employee more than the required minimum wage and that employee
4previously earned less than the required minimum wage, the
5employer may include the portion that does not exceed the
6required minimum wage as compensation paid in Illinois to
7employees who are paid not more than the required minimum
8wage.
9 (1) 25% for reporting periods beginning on or after
10 January 1, 2020 and ending on or before December 31, 2020;
11 (2) 21% for reporting periods beginning on or after
12 January 1, 2021 and ending on or before December 31, 2021;
13 (3) 17% for reporting periods beginning on or after
14 January 1, 2022 and ending on or before December 31, 2022;
15 (4) 13% for reporting periods beginning on or after
16 January 1, 2023 and ending on or before December 31, 2023;
17 (5) 9% for reporting periods beginning on or after
18 January 1, 2024 and ending on or before December 31, 2024;
19 (6) 5% for reporting periods beginning on or after
20 January 1, 2025 and ending on or before December 31, 2025.
21 The amount computed under this subsection may continue to
22be claimed for reporting periods beginning on or after January
231, 2026 and:
24 (A) ending on or before December 31, 2026 for
25 employers with more than 5 employees; or
26 (B) ending on or before December 31, 2027 for

HB3437 Engrossed- 31 -LRB102 14622 CPF 19975 b
1 employers with no more than 5 employees.
2 "Qualified employee" means an employee who is paid not
3more than the required minimum wage and has an average wage
4paid per hour by the employer during the reporting period
5equal to or greater than his or her average wage paid per hour
6by the employer during each reporting period for the
7immediately preceding 12 months. A new qualified employee is
8deemed to have earned the required minimum wage in the
9preceding reporting period.
10 "Reporting period" means the quarter for which a return is
11required to be filed under subsection (b) of this Section.
12 (j) An employer may claim a credit against payments due
13under this Section for amounts withheld during the first
14reporting period beginning after the date on which a tax
15credit certificate was issued under the Investing in Illinois
16Works Tax Credit Act. The credit shall be equal to the amount
17shown on the certificate but may not reduce the taxpayer's
18obligation for any payment due under this Section to less than
19zero. If the amount of the credit exceeds the total payments
20due under this Section with respect to amounts withheld during
21the reporting period, the excess may be carried forward and
22applied against the taxpayer's liability under this Section in
23the 5 succeeding calendar years. The credit shall be applied
24to the earliest reporting period for which there is a tax
25liability. If there are credits from more than one reporting
26period that are available to offset a liability, the earlier

HB3437 Engrossed- 32 -LRB102 14622 CPF 19975 b
1credit shall be applied first. This Section is exempt from the
2provisions of Section 250 of this Act.
3(Source: P.A. 100-303, eff. 8-24-17; 100-511, eff. 9-18-17;
4100-863, eff. 8-14-18; 101-1, eff. 2-19-19.)
5
ARTICLE 99. EFFECTIVE DATE
6 Section 99-99. Effective date. This Act takes effect
7January 1, 2022.
feedback