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HB 3638

Relating to executive sessions.

2025 Regular Session Introduced by Jeff Helfrich

Prohibits contracts from restricting reporting of unlawful conduct or protected concerted activity; allows severable void unilateral provisions, and limits confidentiality in settl

In committee upon adjournment.
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Bill Summary · HB 3638

Summary — HB 3638 (Public Act 104-0320) — “Work Transparency — Confidential”

Status: Enacted as Public Act 104-0320
Introduced: March 3, 2025. Governor approved August 15, 2025. Effective date: January 1, 2026.
Statutory change: Amends the Workplace Transparency Act (820 ILCS 96), revising Sections 1‑5, 1‑10, 1‑15, 1‑20, 1‑25, 1‑30, 1‑35, and 1‑40.

Purpose

The Act reinforces Illinois’s interest in protecting individuals from unlawful workplace discrimination and harassment while recognizing parties’ ability to contract over employment terms. It clarifies which contractual terms are unenforceable when they would limit reporting of unlawful conduct or suppress protected, work‑related concerted activity.

Key provisions

  • Protects reporting and concerted activity

    • No contract, clause, covenant, waiver, or other document may prohibit, prevent, or otherwise restrict an employee, prospective employee, or former employee from: (1) reporting allegations of unlawful conduct to federal, state, or local officials; or (2) engaging in concerted activities to address work‑related issues.
    • “Concerted activity” is defined by reference to collective activity for mutual aid or protection (cross‑referencing federal and Illinois labor law as of January 19, 2025, in amendments).

  • Unilateral vs. mutual conditions of employment

    • A unilateral condition (non‑negotiable requirement imposed by an employer) that prevents truthful statements about unlawful employment practices or protected concerted activity is against public policy and void to the extent it does so; such provisions are severable.
    • Mutual conditions (negotiated, written, with bargained‑for consideration) may include provisions that otherwise would be void if the agreement expressly acknowledges specific rights of the worker — including reporting, participating in proceedings, making truthful disclosures, obtaining confidential legal advice, and engaging in concerted activities.

  • Confidentiality in settlement/termination agreements

    • Employers and workers may enter settlement or termination agreements with confidentiality promises concerning alleged unlawful employment practices only if the confidentiality provision expires no later than 5 years after the alleged unlawful employment practice occurred.

  • Remedies and damages

    • The Act provides for recovery of damages by parties challenging contracts that violate the Act; legislative materials state recovery may include consequential damages incurred in challenging an offending contractual provision (text was amended during consideration).

  • Scope and application

    • Does not apply to collective bargaining agreements governed by the Illinois Public Labor Relations Act or the National Labor Relations Act (the collective bargaining agreement controls in case of conflict).
    • Applies to contracts entered into, modified, or extended on or after the Act’s effective date (January 1, 2026).

Who is affected

  • Employers doing business in Illinois and their contracting practices (hiring, settlement, termination, confidentiality clauses).
  • Current employees, prospective employees, and former employees (broadly defined consistent with Illinois Human Rights Act).
  • Agencies enforcing employment and labor laws (IDHR, IDOL, EEOC, NLRB, OSHA) may be implicated when reporting or claims proceed.

Legislative timeline & status

  • Introduced March 2025; committee hearings and amendments in March–May 2025.
  • Passed both houses (May 31, 2025); sent to Governor June 24, 2025; approved August 15, 2025.
  • Becomes effective January 1, 2026. Enrolled as Public Act 104‑0320.

Related / Notes

  • Companion: SB 2416.
  • The Act clarifies enforceability standards for confidentiality and waiver provisions in employment‑related contracts and strengthens protections for worker speech and collective action.

Compiled from official sources — confirm details with the bill’s official record.

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