Illinois General Assembly - Full Text of SB3776
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Full Text of SB3776  103rd General Assembly

SB3776 103RD GENERAL ASSEMBLY

 


 
103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3776

 

Introduced 2/9/2024, by Sen. Lakesia Collins

 

SYNOPSIS AS INTRODUCED:
 
New Act
820 ILCS 105/3  from Ch. 48, par. 1003
820 ILCS 105/4  from Ch. 48, par. 1004
820 ILCS 105/9  from Ch. 48, par. 1009
820 ILCS 105/12.1 new
820 ILCS 115/4.1

    Creates the Blue Star Restaurant Program Act. Provides that the Department of Labor shall create the Blue Star Restaurant Program to recognize restaurants that voluntarily take no allowance for gratuities under the Minimum Wage Law. Provides for program eligibility requirements, benefits, and revocation of certification. Provides that the Department may adopt rules to implement and enforce the program. Amends the Minimum Wage Law. Provides that, from July 1, 2024 through June 30, 2026, the allowance for gratuities to which an employer is entitled for an employee engaged in an occupation in which gratuities have been recognized as part of the remuneration shall not exceed 20% of the applicable minimum wage rate. Provides that, on and after July 1, 2026, an employer shall not be entitled to an allowance for gratuities and shall pay each employee no less than the applicable minimum wage rate. Defines "interested party". Amends the Minimum Wage Law. Provides for additional notice requirements that employers must provide to employees who receive gratuities. Sets forth provisions concerning civil actions brought by an interested party. Amends the Illinois Wage Payment and Collection Act. Provides that no employer shall withhold from gratuities paid by credit card any credit card processing fees that the employer must pay in connection with the transaction. Provides that any service charge imposed by an employer on a customer shall be a gratuity and is the property of the employees. Effectively immediately.


LRB103 39516 SPS 69717 b

 

 

A BILL FOR

 

SB3776LRB103 39516 SPS 69717 b

1    AN ACT concerning employment.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the Blue
5Star Restaurant Program Act.
 
6    Section 5. Blue Star Restaurant Program.
7    (a) The Department of Labor shall create the Blue Star
8Restaurant Program to recognize restaurants that voluntarily
9take no allowance for gratuities under subsection (c) of
10Section 4 of the Minimum Wage Law.
11    (b) To qualify for recognition as a Blue Star Restaurant
12under the program, an owner of a restaurant must certify, on a
13form created by the Department, that the restaurant has
14satisfied the following requirements:
15        (1) that it takes no allowance for gratuities under
16    subsection (c) of Section 4 of the Minimum Wage Law;
17        (2) that all of the restaurant's owners and employees
18    have completed an equity training program approved by the
19    Department under Section 10; and
20        (3) that it has not been found to have violated the
21    Illinois Wage Payment and Collection Act or the Minimum
22    Wage Law by the Department or a court within the prior 3
23    years.
 

 

 

SB3776- 2 -LRB103 39516 SPS 69717 b

1    Section 10. Equity training program. The Department of
2Labor shall approve an equity training program that trains
3restaurant owners and employees on how to achieve equity among
4employees in the restaurant while maintaining profitability
5and eliminating the subminimum wage for workers who have
6customarily received gratuities. To develop the content of the
7training and provide the training, the Department may work
8with non-profit organizations with an established history of
9working toward the goal of a full minimum wage plus gratuities
10for employees who have customarily received gratuities,
11eliminating the subminimum wage for such employees, and with a
12history of advancing racial equity in restaurants. The
13Director of Labor shall have the authority to approve any
14equity training program under this Section and certify any
15organization to provide the training that meets the criteria
16described in this Section. Under no circumstances may a
17restaurant owner charge an employee a fee for participation in
18an equity training program.
 
19    Section 15. Benefits of program membership. The Department
20of Labor shall certify restaurants participating in the Blue
21Star Restaurant Program that satisfy the requirements
22described in subsection (b) of Section 5 and provide those
23restaurants with the following benefits:
24        (1) issuing the owner of a restaurant a certificate

 

 

SB3776- 3 -LRB103 39516 SPS 69717 b

1    identifying the restaurant as a certified Blue Star
2    Restaurant Program, that may be posted inside of the
3    restaurant; and
4        (2) listing the restaurant on its website as a
5    certified member of the Blue Star Restaurant Program.
 
6    Section 20. Revocation of certification under the program.
7    (a) Upon a finding that a restaurant certified under this
8Act has committed a substantial violation of the Illinois Wage
9Payment and Collection Act or the Minimum Wage Law, the
10Department of Labor shall revoke the certification as soon as
11practicable. Upon written notice of the revocation of its
12certification, the restaurant shall be removed from the
13Department's website and shall not be permitted to display the
14program certification.
15    (b) The Department shall fine any restaurant that violates
16any provision of this Act up to $1,500 per day for each
17violation, payable to the Wage Theft Enforcement Fund.
 
18    Section 25. Rulemaking. The Department of Labor may adopt
19rules to implement and enforce the provisions of this Act.
 
20    Section 90. The Minimum Wage Law is amended by changing
21Sections 3, 4, and 9 and by adding Section 12.1 as follows:
 
22    (820 ILCS 105/3)  (from Ch. 48, par. 1003)

 

 

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1    Sec. 3. As used in this Act:
2    (a) "Director" means the Director of the Department of
3Labor, and "Department" means the Department of Labor.
4    (b) "Wages" means compensation due to an employee by
5reason of his employment, including allowances determined by
6the Director in accordance with the provisions of this Act for
7gratuities and, when furnished by the employer, for meals and
8lodging actually used by the employee.
9    (c) "Employer" includes any individual, partnership,
10association, corporation, limited liability company, business
11trust, governmental or quasi-governmental body, or any person
12or group of persons acting directly or indirectly in the
13interest of an employer in relation to an employee, for which
14one or more persons are gainfully employed on some day within a
15calendar year. An employer is subject to this Act in a calendar
16year on and after the first day in such calendar year in which
17he employs one or more persons, and for the following calendar
18year.
19    (d) "Employee" includes any individual permitted to work
20by an employer in an occupation, and includes, notwithstanding
21subdivision (1) of this subsection (d), one or more domestic
22workers as defined in Section 10 of the Domestic Workers' Bill
23of Rights Act, but does not include any individual permitted
24to work:
25        (1) For an employer employing fewer than 4 employees
26    exclusive of the employer's parent, spouse or child or

 

 

SB3776- 5 -LRB103 39516 SPS 69717 b

1    other members of his immediate family.
2        (2) As an employee employed in agriculture or
3    aquaculture (A) if such employee is employed by an
4    employer who did not, during any calendar quarter during
5    the preceding calendar year, use more than 500 man-days of
6    agricultural or aquacultural labor, (B) if such employee
7    is the parent, spouse or child, or other member of the
8    employer's immediate family, (C) if such employee (i) is
9    employed as a hand harvest laborer and is paid on a piece
10    rate basis in an operation which has been, and is
11    customarily and generally recognized as having been, paid
12    on a piece rate basis in the region of employment, (ii)
13    commutes daily from his permanent residence to the farm on
14    which he is so employed, and (iii) has been employed in
15    agriculture less than 13 weeks during the preceding
16    calendar year, (D) if such employee (other than an
17    employee described in clause (C) of this subparagraph):
18    (i) is 16 years of age or under and is employed as a hand
19    harvest laborer, is paid on a piece rate basis in an
20    operation which has been, and is customarily and generally
21    recognized as having been, paid on a piece rate basis in
22    the region of employment, (ii) is employed on the same
23    farm as his parent or person standing in the place of his
24    parent, and (iii) is paid at the same piece rate as
25    employees over 16 are paid on the same farm.
26        (3) (Blank).

 

 

SB3776- 6 -LRB103 39516 SPS 69717 b

1        (4) As an outside salesman.
2        (5) As a member of a religious corporation or
3    organization.
4        (6) At an accredited Illinois college or university
5    employed by the college or university at which he is a
6    student who is covered under the provisions of the Fair
7    Labor Standards Act of 1938, as heretofore or hereafter
8    amended.
9        (7) For a motor carrier and with respect to whom the
10    U.S. Secretary of Transportation has the power to
11    establish qualifications and maximum hours of service
12    under the provisions of Title 49 U.S.C. or the State of
13    Illinois under Section 18b-105 (Title 92 of the Illinois
14    Administrative Code, Part 395 - Hours of Service of
15    Drivers) of the Illinois Vehicle Code.
16        (8) As an employee employed as a player who is 28 years
17    old or younger, a manager, a coach, or an athletic trainer
18    by a minor league professional baseball team not
19    affiliated with a major league baseball club, if (A) the
20    minor league professional baseball team does not operate
21    for more than 7 months in any calendar year or (B) during
22    the preceding calendar year, the minor league professional
23    baseball team's average receipts for any 6-month period of
24    the year were not more than 33 1/3% of its average receipts
25    for the other 6 months of the year.
26    The above exclusions from the term "employee" may be

 

 

SB3776- 7 -LRB103 39516 SPS 69717 b

1further defined by regulations of the Director.
2    (e) "Occupation" means an industry, trade, business or
3class of work in which employees are gainfully employed.
4    (f) "Gratuities" means voluntary monetary contributions to
5an employee from a guest, patron or customer in connection
6with services rendered.
7    (g) "Outside salesman" means an employee regularly engaged
8in making sales or obtaining orders or contracts for services
9where a major portion of such duties are performed away from
10his employer's place of business.
11    (h) "Day camp" means a seasonal recreation program in
12operation for no more than 16 weeks intermittently throughout
13the calendar year, accommodating for profit or under
14philanthropic or charitable auspices, 5 or more children under
1518 years of age, not including overnight programs. The term
16"day camp" does not include a "day care agency", "child care
17facility" or "foster family home" as licensed by the Illinois
18Department of Children and Family Services.
19    (i) "Interested party" means an organization that monitors
20or is attentive to compliance with public or worker safety
21laws, wage and hour requirements, or other statutory
22requirements.
23(Source: P.A. 99-758, eff. 1-1-17; 100-192, eff. 8-18-17.)
 
24    (820 ILCS 105/4)  (from Ch. 48, par. 1004)
25    Sec. 4. (a)(1) Every employer shall pay to each of his

 

 

SB3776- 8 -LRB103 39516 SPS 69717 b

1employees in every occupation wages of not less than $2.30 per
2hour or in the case of employees under 18 years of age wages of
3not less than $1.95 per hour, except as provided in Sections 5
4and 6 of this Act, and on and after January 1, 1984, every
5employer shall pay to each of his employees in every
6occupation wages of not less than $2.65 per hour or in the case
7of employees under 18 years of age wages of not less than $2.25
8per hour, and on and after October 1, 1984 every employer shall
9pay to each of his employees in every occupation wages of not
10less than $3.00 per hour or in the case of employees under 18
11years of age wages of not less than $2.55 per hour, and on or
12after July 1, 1985 every employer shall pay to each of his
13employees in every occupation wages of not less than $3.35 per
14hour or in the case of employees under 18 years of age wages of
15not less than $2.85 per hour, and from January 1, 2004 through
16December 31, 2004 every employer shall pay to each of his or
17her employees who is 18 years of age or older in every
18occupation wages of not less than $5.50 per hour, and from
19January 1, 2005 through June 30, 2007 every employer shall pay
20to each of his or her employees who is 18 years of age or older
21in every occupation wages of not less than $6.50 per hour, and
22from July 1, 2007 through June 30, 2008 every employer shall
23pay to each of his or her employees who is 18 years of age or
24older in every occupation wages of not less than $7.50 per
25hour, and from July 1, 2008 through June 30, 2009 every
26employer shall pay to each of his or her employees who is 18

 

 

SB3776- 9 -LRB103 39516 SPS 69717 b

1years of age or older in every occupation wages of not less
2than $7.75 per hour, and from July 1, 2009 through June 30,
32010 every employer shall pay to each of his or her employees
4who is 18 years of age or older in every occupation wages of
5not less than $8.00 per hour, and from July 1, 2010 through
6December 31, 2019 every employer shall pay to each of his or
7her employees who is 18 years of age or older in every
8occupation wages of not less than $8.25 per hour, and from
9January 1, 2020 through June 30, 2020, every employer shall
10pay to each of his or her employees who is 18 years of age or
11older in every occupation wages of not less than $9.25 per
12hour, and from July 1, 2020 through December 31, 2020 every
13employer shall pay to each of his or her employees who is 18
14years of age or older in every occupation wages of not less
15than $10 per hour, and from January 1, 2021 through December
1631, 2021 every employer shall pay to each of his or her
17employees who is 18 years of age or older in every occupation
18wages of not less than $11 per hour, and from January 1, 2022
19through December 31, 2022 every employer shall pay to each of
20his or her employees who is 18 years of age or older in every
21occupation wages of not less than $12 per hour, and from
22January 1, 2023 through December 31, 2023 every employer shall
23pay to each of his or her employees who is 18 years of age or
24older in every occupation wages of not less than $13 per hour,
25and from January 1, 2024 through December 31, 2024, every
26employer shall pay to each of his or her employees who is 18

 

 

SB3776- 10 -LRB103 39516 SPS 69717 b

1years of age or older in every occupation wages of not less
2than $14 per hour; and on and after January 1, 2025, every
3employer shall pay to each of his or her employees who is 18
4years of age or older in every occupation wages of not less
5than $15 per hour.
6    (2) Unless an employee's wages are reduced under Section
76, then in lieu of the rate prescribed in item (1) of this
8subsection (a), an employer may pay an employee who is 18 years
9of age or older, during the first 90 consecutive calendar days
10after the employee is initially employed by the employer, a
11wage that is not more than 50˘ less than the wage prescribed in
12item (1) of this subsection (a); however, an employer shall
13pay not less than the rate prescribed in item (1) of this
14subsection (a) to:
15        (A) a day or temporary laborer, as defined in Section
16    5 of the Day and Temporary Labor Services Act, who is 18
17    years of age or older; and
18        (B) an employee who is 18 years of age or older and
19    whose employment is occasional or irregular and requires
20    not more than 90 days to complete.
21    (3) At no time on or before December 31, 2019 shall the
22wages paid to any employee under 18 years of age be more than
2350˘ less than the wage required to be paid to employees who are
24at least 18 years of age under item (1) of this subsection (a).
25Beginning on January 1, 2025 2020, every employer shall pay to
26each of his or her employees who is under 18 years of age that

 

 

SB3776- 11 -LRB103 39516 SPS 69717 b

1has worked more than 650 hours for the employer during any
2calendar year a wage not less than the wage required for
3employees who are 18 years of age or older under paragraph (1)
4of subsection (a) of Section 4 of this Act. Every employer
5shall pay to each of his or her employees who is under 18 years
6of age that has not worked more than 650 hours for the employer
7during any calendar year: (1) $8 per hour from January 1, 2020
8through December 31, 2020; (2) $8.50 per hour from January 1,
92021 through December 31, 2021; (3) $9.25 per hour from
10January 1, 2022 through December 31, 2022; (4) $10.50 per hour
11from January 1, 2023 through December 31, 2023; (5) $12 per
12hour from January 1, 2024 through December 31, 2024; and (6)
13$13 per hour on and after January 1, 2025.
14    (b) No employer shall discriminate between employees on
15the basis of sex or mental or physical disability, except as
16otherwise provided in this Act by paying wages to employees at
17a rate less than the rate at which he pays wages to employees
18for the same or substantially similar work on jobs the
19performance of which requires equal skill, effort, and
20responsibility, and which are performed under similar working
21conditions, except where such payment is made pursuant to (1)
22a seniority system; (2) a merit system; (3) a system which
23measures earnings by quantity or quality of production; or (4)
24a differential based on any other factor other than sex or
25mental or physical disability, except as otherwise provided in
26this Act.

 

 

SB3776- 12 -LRB103 39516 SPS 69717 b

1    (c) Every employer of an employee engaged in an occupation
2in which gratuities have customarily and usually constituted
3and have been recognized as part of the remuneration for hire
4purposes is entitled to an allowance for gratuities as part of
5the hourly wage rate provided in Section 4, subsection (a) in
6an amount not to exceed 40% of the applicable minimum wage rate
7through June 30, 2024. From July 1, 2024 through June 1, 2026,
8the allowance for gratuities shall not exceed 20% of the
9applicable minimum wage rate. On and after July 1, 2026, an
10employer shall not be entitled to an allowance for gratuities
11and shall pay each employee no less than the applicable
12minimum wage rate as provided in paragraph (1) of subsection
13(a). An allowance for gratuities shall only be taken for
14shifts in which an employee's wages and gratuities combined
15over that shift result in an average hourly wage rate equal to
16or greater than the hourly minimum wage provided in paragraph
17(1) of subsection (a).
18    The Director shall require each employer desiring an
19allowance for gratuities to provide substantial evidence that
20the amount claimed, which may not exceed the allowance amount
21prescribed in this subsection 40% of the applicable minimum
22wage rate, was received by the employee in the period for which
23the claim of exemption is made, and no part thereof was
24returned to the employer, and that the employer provides, at
25the time of payment, a written accounting of the hourly wages
26paid, the gratuities earned, and the average hourly

 

 

SB3776- 13 -LRB103 39516 SPS 69717 b

1remuneration for each shift worked during the pay period.
2    An employer shall not keep any gratuities received by an
3employee for any purpose or allow a manager or a supervisor to
4keep any portion of an employee's gratuities, regardless of
5whether or not the employer takes an allowance for gratuities.
6Nothing in this subsection shall be construed to prohibit an
7otherwise valid pooling of gratuities among non-managerial and
8non-supervisory employees.
9    (d) No camp counselor who resides on the premises of a
10seasonal camp of an organized not-for-profit corporation shall
11be subject to the adult minimum wage if the camp counselor (1)
12works 40 or more hours per week, and (2) receives a total
13weekly salary of not less than the adult minimum wage for a
1440-hour week. If the counselor works less than 40 hours per
15week, the counselor shall be paid the minimum hourly wage for
16each hour worked. Every employer of a camp counselor under
17this subsection is entitled to an allowance for meals and
18lodging as part of the hourly wage rate provided in Section 4,
19subsection (a), in an amount not to exceed 25% of the minimum
20wage rate.
21    (e) A camp counselor employed at a day camp is not subject
22to the adult minimum wage if the camp counselor is paid a
23stipend on a onetime or periodic basis and, if the camp
24counselor is a minor, the minor's parent, guardian or other
25custodian has consented in writing to the terms of payment
26before the commencement of such employment.

 

 

SB3776- 14 -LRB103 39516 SPS 69717 b

1(Source: P.A. 101-1, eff. 2-19-19.)
 
2    (820 ILCS 105/9)  (from Ch. 48, par. 1009)
3    Sec. 9. (a) Every employer subject to any provision of
4this Act or of any regulations issued under this Act shall keep
5a summary of this Act approved by the Director, and copies of
6any applicable regulations issued under this Act or a summary
7of such regulations, posted in a conspicuous and accessible
8place in or about the premises wherever any person subject to
9this Act is employed. Every employer subject to any provision
10of this Act or any regulations issued under this Act with
11employees who do not regularly report to a physical workplace,
12such as employees who work remotely or travel for work, shall
13also provide the summaries and regulations by email to its
14employees or conspicuous posting on the employer's website or
15intranet site, if such site is regularly used by the employer
16to communicate work-related information to employees and is
17able to be regularly accessed by all employees, freely and
18without interference. Employers shall be furnished copies of
19such summaries and regulations by the State on request without
20charge.
21    (b) Every employer shall provide each employee who
22receives gratuities, in writing in English and in the language
23identified by each employee as the primary language of the
24employee, at the time of hiring, a notice containing:
25        (1) the rate of pay and basis thereof, whether paid by

 

 

SB3776- 15 -LRB103 39516 SPS 69717 b

1    the hour, shift, day, week, salary, or other method,
2    including overtime compensation rates for non-exempt
3    employees and allowances claimed as part of the minimum
4    wage, including gratuities;
5        (2) employees' rights to be compensated by their
6    employer at the rate prescribed in subsection (a) of
7    Section 4 when gratuities do not bring the employee to
8    that rate at the end of each shift;
9        (3) employee rights to retain gratuities as described
10    in this Act; and
11        (4) and other relevant employee rights deemed
12        necessary by the Director by rule.
13    The Director shall prepare a template that complies with
14the notice requirements of this subsection. The template shall
15include the information required by this subsection in 2
16languages, including English and one additional language
17determined by the Director based on the population of this
18State that speaks the language and any other factor that the
19Director deems relevant.
20(Source: P.A. 103-201, eff. 1-1-24.)
 
21    (820 ILCS 105/12.1 new)
22    Sec. 12.1. Civil actions brought by an interested party.
23    (a) Upon a reasonable belief that an employer covered by
24this Act is in violation of any part of this Act, an interested
25party may initiate a civil action in the county where the

 

 

SB3776- 16 -LRB103 39516 SPS 69717 b

1alleged offenses occurred or where any party to the action
2resides, asserting that a violation of this Act has occurred,
3pursuant to the following sequence of events:
4        (1) The interested party submits to the Department of
5    Labor a complaint describing the violation and naming the
6    employer alleged to have violated this Act.
7        (2) The Department sends notice of complaint to the
8    named parties alleged to have violated this Act and the
9    interested party. The named parties may either contest the
10    alleged violation or cure the alleged violation.
11        (4) The Department issues a notice of right to sue to
12    the interested party, if one or more of the following has
13    occurred:
14            (A) the named party has cured the alleged
15        violation to the satisfaction of the Director;
16            (B) the Director has determined that the
17        allegation is unjustified or that the Department does
18        not have jurisdiction over the matter or the parties;
19        or
20            (C) the Director has determined that the
21        allegation is justified or has not made a
22        determination, and either has decided not to exercise
23        jurisdiction over the matter or has concluded
24        administrative enforcement of the matter.
25    (b) If within 180 days after service of the notice of
26complaint to the parties, the Department has not (i) resolved

 

 

SB3776- 17 -LRB103 39516 SPS 69717 b

1the contest and cure period, (ii) with the mutual agreement of
2the parties, extended the time for the named party to cure the
3violation and resolve the complaint, or (iii) issued a right
4to sue letter, the interested party may initiate a civil
5action for penalties. The parties may extend the 180-day
6period by mutual agreement. The limitations period for the
7interested party to bring an action for the alleged violation
8of the Act shall be tolled for the 180-day period and for the
9period of any mutually agreed extensions. At the end of the
10180-day period, or any mutually agreed extensions, the
11Department shall issue a right to sue letter to the interested
12party.
13    (c) Any claim or action filed under this Section must be
14made within 3 years of the alleged conduct resulting in the
15complaint plus any period for which the limitations period has
16been tolled.
17    (d) In an action brought in accordance with
this Section,
18an interested party may recover against the covered entity any
19statutory penalties and injunctive relief. An interested party
20who prevails in a civil action shall receive 10% of any
21statutory penalties assessed, plus any attorneys' fees and
22expenses in bringing the action. The remaining 90% of any
23statutory penalties assessed shall be deposited into the
24Department's Wage Theft Enforcement Fund.
 
25    Section 95. The Illinois Wage Payment and Collection Act

 

 

SB3776- 18 -LRB103 39516 SPS 69717 b

1is amended by changing Section 4.1 as follows:
 
2    (820 ILCS 115/4.1)
3    Sec. 4.1. Gratuities.
4    (a) Gratuities to employees are the property of the
5employees, and employers shall not keep gratuities. Failure to
6pay gratuities owed to an employee more than 13 days after the
7end of the pay period in which such gratuities were earned
8constitutes a violation of this Act.
9    (a-5) Any service charge imposed by an employer on a
10customer shall be a gratuity as described in subsection (a)
11and is the property of the employees. An employer who imposes a
12bona fide service charge on a customer shall explicitly and
13conspicuously disclose to the consumer that all funds
14generated from the service charge are directly given to the
15employees in the form of a gratuity.
16    (b) No employer shall withhold This Section does not
17prohibit an employer from withholding from gratuities paid by
18credit card a proportionate amount of any credit card
19processing fees that the employer must pay in connection with
20the transaction, provided that the amount withheld does not
21exceed the proportion of the amount of the tip to the amount of
22the overall bill, regardless of whether the overall bill was
23paid using a credit card. This Section does not prohibit tip
24pooling as permitted by law. This Section does not affect an
25employer's entitlement to an allowance for gratuities to the

 

 

SB3776- 19 -LRB103 39516 SPS 69717 b

1extent permitted under subsection (c) of Section 4 of the
2Minimum Wage Law.
3(Source: P.A. 101-509, eff. 1-1-20.)
 
4    Section 999. Effective date. This Act takes effect upon
5becoming law.