Follow us on LinkedIn to see future News.
January 27, 2026
In case you missed it, several laws became effective in Illinois in late 2025 or early 2026. This article is one of three articles discussing those laws. We published an article in December 2025 discussing changes to leave laws in Illinois. This article discusses amendments to Illinois’s Workplace Transparency Act, which grants employees increased protection when reporting unlawful employment practices. A third article will address amendments to Illinois’s Human Rights Act and increased protections related to immigration.
The Illinois Workplace Transparency Act (Act) restricts employers’ use of agreements, like nondisclosure agreements and confidentiality clauses, to ban employee communications about alleged unlawful workplace conduct (discrimination, harassment, or retaliation). The Act also protects employees’ rights to report such conduct or participate in investigations of such conduct.
Effective January 1, 2026, Illinois expanded these protections through amendments to the Act. See 2025 Ill. HB 3638.
First, the amendments expand the scope of unlawful employment practices that are subject to the Act. Specifically, an “unlawful employment practice” now includes any unlawful practice actionable under state or federal employment laws (not just discrimination, harassment, or retaliation).
Second, the amended Act bans clauses that limit concerted activity to address work-related issues.
Third, the amended Act bans unilateral clauses that (1) shorten statutes of limitations; (2) apply non-Illinois law or venue; (3) require Illinois claims to be adjudicated outside of Illinois if doing so would deny the employee a right or remedy related to unlawful employment practices. If such agreements are mutual, they may be included, as long as they are in writing; in exchange for consideration (something of value to which the employee is not otherwise entitled); and acknowledge the employee’s right to report unlawful conduct to an appropriate agency, participate in proceedings related to unlawful employment practices, and engage in concerted activity to address workplace issues.
Fourth, the amended Act contains new requirements for confidentiality clauses in settlement or separation agreements. Employers may not unilaterally include a clause in a settlement or separation agreement stating that confidentiality is the employee’s preference. If a settlement or separation agreement is resolving allegations of unlawful employment practices, any confidentiality provision in the agreement must be supported by consideration that is separate from the consideration that is provided for a release of other claims. Further, the Act prohibits employers from including confidentiality provisions that restrict employees from engaging in future concerted activity concerning workplace conditions (think: non-disparagement clauses).
Fifth, the amended Act clarifies that, in addition to allowing employees to testify about unlawful conduct in administrative, legislative, or judicial proceedings, employees also may testify in arbitral proceedings.
Lastly, the amended Act expands available remedies to include “consequential damages.” Such remedies will apply to successful challenges to the enforcement of an employment agreement, as well as to successful defenses to claims that an employee breached a confidentiality agreement.
Illinois Employers: It is time to review and update your employment agreements and your settlement and separation agreement templates to comply with the amended Act.
The author of this article, Patricia Tsipras, is a member of the Bar of Pennsylvania. This article is designed to provide one perspective regarding recent legal developments, and is not intended to serve as legal advice in Pennsylvania, Illinois, or any other jurisdiction, nor does it establish an attorney-client relationship with any reader of the article where one does not exist. Always consult an attorney with specific legal issues.
