January 2027 employer changes: Illinois, Connecticut, California
Three state employer rules change on 1 January 2027. Illinois limits driver's license requirements in job postings. Connecticut paid sick leave reaches employers with one or more employees. California raises the minimum wage to $17.40 an hour and the standard minimum exempt salary to $72,384 a year. Here is what each change asks of you, with official sources for the legal requirements.
About this note
Published Researched
Illinois: driver's license requirements in job postings
Public Act 104-0776 adds Section 17 to the Job Opportunities for Qualified Applicants Act. From 1 January 2027, an employer or employment agency may not state in a job posting that an applicant must have a valid driver's license unless driving is one of the essential functions of the job and is a business necessity. When a job does require a license, the posting must include a brief explanation of why.
The rule covers employers with 15 or more employees in the current or preceding calendar year, and employment agencies. Start by listing every posting and template connected to Illinois that mentions a license. Record the reason for each requirement you keep. For remote or multistate positions, confirm whether Illinois law applies to the posting before excluding it from the review.
Connecticut: paid sick leave for one or more employees
From 1 January 2027, Connecticut paid sick leave generally covers employers with one or more employees in the state, the last step of the expansion under Public Act 24-8. The Connecticut Department of Labor says coverage is based on payroll for the week that contains 1 January. Employees accrue 1 hour for every 30 hours worked, up to 40 hours in the 365 day period the employer uses for benefits, and may begin using accrued leave after 120 calendar days have elapsed from their hire date. Employers may waive or shorten that wait. Seasonal employees are excluded, and so are employers in qualifying construction related multiemployer health plans and their member employees. Records of hours worked, accrued and used are kept for at least three years.
A part time employee working 25 hours a week reaches the 40 hour yearly limit after 1,200 hours worked, in week 48. At 20 hours a week for 52 weeks, an employee earns at least 34 hours of sick leave.
California: $17.40 an hour and $72,384 a year
The Department of Industrial Relations announced that the statewide minimum wage rises to $17.40 an hour on 1 January 2027. The standard minimum salary for exempt executive, administrative and professional employees becomes $72,384 a year, which is two times the state minimum wage for full time work. An exempt employee must also meet the duties test. Cities and counties can set a higher local minimum wage, and covered fast food and health care workers have their own higher minimum wages. Some exemptions carry their own thresholds. In 2027, the computer software exemption requires at least $127,108.34 a year for salaried employees or $61.03 an hour for hourly employees.
An office manager paid $70,000 and treated as exempt is $2,384 below the new minimum. The choice before 1 January is to raise the salary to at least $72,384 where the role meets the duties test, or to reclassify the role as nonexempt and pay overtime.
A completed example
An example business with 22 employees posts jobs connected to Illinois, has five people in Connecticut and twelve in California. Here is how the kit records its review before the business makes any changes.
| Applicability answers Illinois, Connecticut, California | Result |
|---|---|
| Illinois postings, 22 employees, not an employment agency 15 or more employees in the current or preceding year | Applies |
| Connecticut: employees on payroll for the week that contains 1 January, no construction multiemployer plan One or more employees | Applies |
| California: local and industry rates not yet answered A missing answer that the decision needs is never treated as No | Check |
| California Salary Review rows Entered pay and status | Review flag |
|---|---|
| Office manager, $70,000, standard exemption Rates checked | Review: $2,384 below $72,384 |
| Bookkeeper, $41,600 salary, nonexempt No hours entered | Review: confirm hours, regular rate and overtime |
| Software developer, $90,000, other exemption Computer software threshold applies | Review: confirm that exemption's own threshold |
| Barista, $18.00 an hour Applicable rate and its official source not yet entered | Check: enter the applicable rate first |
| Illinois Posting Review rows License decision and wording | Review flag |
|---|---|
| Office coordinator License required, driving not essential | Review: remove the requirement |
| Delivery driver Essential and a business necessity, no explanation yet | Review: add the explanation |
| Route sales representative Explanation added, final wording and posting location recorded | Confirm the live posting |
Use the action checklist to give each flagged item an owner, a due date and a place to record the evidence. Mark a step done only when its evidence location is recorded. In this example, the software developer's $90,000 salary is below the $127,108.34 a year that the computer software exemption requires for salaried employees, so that row needs a decision before 1 January.
Put the changes that apply to your business into a working plan
Our January 2027 Employer Change Action Kit includes an Excel applicability check, state specific action checklists, a California pay review, a Connecticut accrual worksheet with a policy starting draft, and an Illinois posting review. You can assign owners, set due dates and record the evidence for each completed step. The kit also includes an eight page guide and the sources used. The download is $39 under the Standard License, with a 30 day money back guarantee.
The kit covers three selected January 2027 changes. It helps organize reviews and identify items requiring attention. It does not determine legal compliance, classify employees or calculate every applicable wage and leave requirement.
Research and sources
Researched 8 November 2026. Each source was opened on that date.
- Illinois General Assembly, Public Act 104-0776 (effective 1 January 2027), with Littler, 17 August 2026
- Connecticut Department of Labor, Paid Sick Leave FAQs (updated 23 September 2026), with Office of Legislative Research report 2025-R-0016 and CGS 31-57s
- California Department of Industrial Relations, release 2026-66 (13 August 2026), with CDF Labor Law, 18 August 2026, and DIR, Overtime Exemption for Computer Software Employees
Rules can change. This note is general information, not legal advice.
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