Labor & Employment Law Update

If your business has 16 or more employees in Illinois, a new law—the Family Neonatal Intensive Care Leave Act—requires you to provide additional job-protected leave for parents with a newborn or newly adopted child in the neonatal intensive care unit (NICU).

The Illinois Neonatal Intensive Care Leave Act (NICLA) takes effect June 1, 2026. Here’s what you need to know.

What Is NICLA?

NICLA is a new Illinois law that gives employees the right to take unpaid, job-protected leave while their child is hospitalized in a NICU. The amount of leave depends on the size of your company:

Who Is Eligible?

NICLA has broad eligibility rules—broader than the federal Family and Medical Leave Act (FMLA). An employee qualifies for NICLA leave if:

• Their employer has more than 16 employees in Illinois.
• Their child is currently hospitalized in a NICU.

Note that there is no minimum length of employment and no minimum number of hours worked. Part-time and newly hired employees qualify just the same as full-time, long-tenured staff.

Tip: An employee who is not eligible for FMLA leave (for example, someone who has worked fewer than 12 months) may still be entitled to NICLA leave. Make sure your HR team does not use FMLA eligibility as the standard when a NICU situation arises.

Who Counts as a “Child”?

Under NICLA, a “child” includes biological, adopted, or foster children; stepchildren; legal wards; or a child of someone who has assumed legal responsibility to act as a parent to the child (i.e., standing in loco parentis).

How NICLA Works Alongside FMLA

NICLA leave is separate from FMLA leave—it does not replace it. Here is how the two interact:

• If the employee is FMLA-eligible, they must use their FMLA leave first.
• If the child is still in the NICU after the employee has exhausted all FMLA leave, NICLA leave kicks in for additional days.
• Employees who are not FMLA-eligible can go straight to NICLA leave.

Key Rules for Taking NICLA Leave

Continuous or Intermittent

Employees may take NICLA leave all at once or in smaller increments. Employers may require that any intermittent leave be taken in blocks of no less than two hours at a time.

Paid Time Off Is Optional

Unlike FMLA leave, employers cannot require employees to substitute accrued paid leave (such as vacation or sick days) for NICLA leave. However, employees may choose to use their paid time off at the same time if they wish.

Verification Is Allowed

Employers may ask for reasonable documentation from a healthcare provider confirming the child’s NICU hospitalization and the expected length of stay. Employers cannot, however, require the disclosure of confidential medical details beyond what is necessary to verify the leave.

Employer Obligations During and After Leave

While an employee is on NICLA leave and upon their return, you must:

• Continue providing health insurance benefits on the same terms as before the leave.
• Reinstate the employee to the same position or a substantially equivalent one with the same pay and benefits.
• Not require the employee to use their accrued paid time off as a condition of taking NICLA leave.
• Not retaliate against an employee for requesting or taking NICLA leave, or for supporting a coworker who does.

Violations of NICLA can result in civil penalties of up to $5,000 per infraction.

Employer Action Checklist

If your company has more than 16 employees, here’s what to do before June 1, 2026:

• Update your employee handbook to include a NICLA policy section explaining employee rights and the process for requesting leave.
• Train HR and managers so they understand NICLA requirements and know how to respond when an employee requests this type of leave.
• Create a NICLA notice to provide to employees alongside FMLA paperwork whenever a NICU-related leave request is made.
• Review your leave tracking process to ensure NICLA days are tracked separately from FMLA days.
• Consult legal counsel if you have questions about how NICLA applies to your specific workforce or situation.