STUDY: Fair Workweek Laws Shown to Boost Wages and Job Quality in Essential and Frontline Industries 

The The State of Oregon, City of Chicago, and Six Other U.S. Cities Currently Have Fair Workweek Laws on the Books

La Grange, IL: As face-to-face and essential industries continue struggling to attract and retain sufficient numbers of qualified workers, a new study by the nonpartisan Illinois Economic Policy Institute (ILEPI) and the University of Illinois at Urbana-Champaign’s Project for Middle Class Renewal (PMCR) has found that Oregon’s Fair Workweek law has succeeded in boosting wages, job stability, and employee retention in the retail, food service, and hospitality industries—and that a statewide expansion of Chicago’s even more expansive Fair Workweek Ordinance could benefit more than one million workers.
Read the report, “Implementing a Fair Workweek Law in Illinois: Protecting Frontline Workers from Unpredictable Schedules.”
Also known as predictive scheduling laws, fair workweek laws typically provide as many as five standard protections to workers in covered industries. These include providing a set number of days advance notice of work schedules (advance notice), ensuring that employers offer additional hours to existing employees before hiring new workers (access to hours), compensating employees for last-minute changes or reductions in work schedules (predictability pay), protecting an employee’s right to request schedule changes without fear of retaliation (right to request), and guaranteeing employees a minimum amount of rest time in-between shifts (right to rest). While seven U.S. municipalities—including Chicago—have fair workweek ordinances, Oregon is currently the only U.S. state with such a law on the books. A national fair workweek law has been proposed in Congress, and in 2021, a bill was introduced in the Illinois General Assembly to implement a state law.
The ILEPI and PMCR analysis uses five years of U.S. Department of Labor and Census Bureau data to examine employment outcomes during the 30 months before and after Oregon enacted its Fair Workweek Act. The law covers 172,000 workers for retail, food service, and accommodation employers with more than 500 employees.
“Relative to national averages, it’s clear that weekly wages in the industries covered by Oregon’s fair workweek law grew faster on average than states without these protections, while improving employment stability and reducing employee turnover,” said ILEPI Research Associate and study coauthor Grace Dunn. “The data reveal that these policies can help more employers attract and retain workers back into industries hit hardest by the COVID-19 pandemic.”

Overall, the ILEPI and PMCR analysis revealed that average weekly wages grew 5% faster in covered industries following enactment of Oregon’s Fair Workweek Act, while the share of workers who were involuntarily employed part-time shrank at a faster rate than in other states. Additionally, employee turnover was lower and workforce retention rates were higher in Oregon’s covered industries, relative to national averages, after the law was in effect. 
“As we face historically tight labor markets in sectors that require face-to-face work, improving job quality is critical both for workers and employers,” said ILEPI Executive Director and study coauthor Frank Manzo IV. “The data makes clear that Oregon’s Fair Workweek Act is proving to be a win-win for both.”

In addition to retail, food services, and accommodations sectors, the City of Chicago’s Fair Workweek Ordinance covers the health care, warehouse, manufacturing, and building services sectors. It applies only to workers earning less than $26 per hour at employers with 100 or more workers, at restaurant employers with 250 or more workers and 30 locations, and non-profits with 250 or more employees.  In 2021, legislation was introduced (HB 3285) that would have extended the Chicago ordinance to cover all similarly situated workers statewide.

In analyzing the potential impacts of that legislation, ILEPI and PMCR researchers determined that it could cover as many as 1.6 million workers statewide—disproportionately benefiting women, people of color, and non-college educated and low-wage workers in essential and frontline industries where employment still lags pre-pandemic levels. Nearly half (44%) earn less than $15 per hour and four out of every five (80%) earn less than $26 per hour. 

“The disruption of a global pandemic has exposed the persistent inequality facing women and people of color in our workforce and the critical importance of improving jobs in the essential and frontline industries that can least afford labor supply shortages,” concluded study coauthor and University of Illinois at Urbana-Champaign Research Fellow Dr. Larissa Petrucci, who has also previously studied Oregon’s Fair Workweek Act. “It is clear that a fair workweek law is a valuable tool to protect our most vulnerable workers by establishing scheduling standards that are proven to improve job satisfaction and retention, which benefits workers, employers, and our economy as a whole.

The Illinois Economic Policy Institute (ILEPI) is a nonpartisan nonprofit organization which uses advanced statistics and the latest forecasting models to promote thoughtful economic growth for businesses and working families in Illinois and across the Midwest.

The Project for Middle Class Renewal (PMCR) at the University of Illinois at Urbana-Champaign investigates the working conditions of workers in today’s economy to elevate public discourse aimed at reducing poverty, create more stable forms of employment, and promote middle-class jobs.