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Illinois has significantly amended the Workplace Transparency Act (WTA) introducing new requirements and restrictions on employment agreements such as offer letters, confidentiality/NDA agreements, restrictive covenant agreements, settlement agreements, and termination agreements. The WTA covers employers with one or more employees, including contractors and consultants who are directly performing services for the employer. The amendments apply to any employment agreement entered into, modified, or extended on or after January 1, 2026.

 

The WTA ensures that employees are not prohibited by any agreement from reporting unlawful employment practices to federal or state authorities. Previously, the WTA voided agreements that prevented an employee from making truthful statements or disclosures about alleged unlawful employment practices actionable under the Illinois Human Rights Act, the Equal Employment Opportunities Act, or Title VII of the Civil Rights Act of 1964. The amendments have expanded the scope of the WTA to now include employment practices made unlawful under any state or federal law regulating employment that is enforced by the following agencies: the Department of Labor, Illinois Labor Relations Board, U.S. Department of Labor, the Occupational Health and Safety Administration, or the National Labor Relations Board. This extends the application of the WTA beyond claims of discrimination, harassment, and retaliation to include workplace safety claims, wage and hour claims, FMLA claims, and claims related to engaging in concerted activities to address work-related issues. 

 

Additionally, the WTA now states that employment agreements may not prohibit or restrict employees, prospective employees, or former employees from engaging in concerted activities to address work-related issues like collective bargaining, union organizing, and discussing wages, hours, and working conditions. Any unilateral condition of employment or continued employment may not: (1) shorten an applicable statute of limitations, (2) apply non-Illinois law to an Illinois employee’s claim, (3) require a non-Illinois venue for an Illinois employee’s claim, or (4) state that confidentiality is the employee’s preference. Terms that are not allowed as unilateral conditions may still be included as a mutual condition of employment if they are in writing, supported by actual, knowing, bargained-for consideration, and if the agreement expressly acknowledges the individual’s rights to report unlawful employment practices and criminal conduct, participate in proceedings related to unlawful employment practices (including private litigation and arbitration), make truthful statements required by law, seek confidential legal advice, and engage in concerted activity to address workplace issues.

 

When an agreement includes confidentiality regarding alleged unlawful employment practices, the promise of confidentiality must be supported by separate, bargained-for consideration that is distinct from the consideration for a release of claims. Employers may not unilaterally state that confidentiality reflects the employee’s preference and the provisions cannot restrict future or prospective concerted activity related to workplace conditions. The WTA clarifies that employees – including prospective and former employees – may participate in legal proceedings like providing deposition testimony  concerning alleged unlawful employment practices or criminal conduct.

 

Employers will want to review all employment-related agreement templates to ensure compliance with the WTA. Under these new amendments, individuals may recover consequential damages for establishing a violation of the WTA or for successfully defending against an employer’s claim for breach of confidentiality under the WTA in addition to reasonable attorneys’ fees and costs.