Lawmakers just passed 2 bills making Illinois even worse for business

This legislative session members of the Illinois General Assembly passed a bill to make it easier to sue out-of-state businesses and a bill that would prevent state agencies from adopting eased workplace regulations. Illinois’ business climate is bad, but these bills could make it worse.

Illinois is one of the worst states in the country for business – largely because of taxes and regulations – but state lawmakers are trying to make it worse with two bills headed to Gov. J.B. Pritzker.

Senate Bill 328 would make it easier to sue out-of-state businesses merely for being registered in Illinois. Senate Bill 1976 would prevent Illinois business from benefitting from any federal rules easing workplace regulations. If Pritzker wants to attract businesses and the revenue and jobs they generate for the state, he should veto these bills.

Senate Bill 328 makes it easier to sue businesses that register in Illinois

SB 328 would require companies registered to do business in Illinois to consent to what is known as the state’s “general jurisdiction.” Companies could be sued in Illinois courts even if the plaintiffs were not from Illinois and even if the harm did not occur in the state. What that means in practice is that any company registered to do business in Illinois would be opening itself up to a higher-than-normal level of litigation.

The bill follows a 5-4 U.S. Supreme Court decision upholding a similar law enacted in Pennsylvania. If signed into law, Illinois would be only the second state with such a statute.

Although a handful of other state courts have claimed authority to exercise general jurisdiction over businesses registered in the state without such a law, the Illinois Supreme Court has explicitly rejected doing so.

Illinois was already ranked dead last by the U.S. Chamber of Commerce’s Lawsuit Climate Survey. Cook County has been continually listed in the American Tort Reform Foundation’s top “Judicial Hellholes” for at least a decade, often joined by St. Clair and Madison counties, which have either been included or given “dishonorable” mentions. Enacting SB 328 could cement the state’s position in the mind of businesses as a black hole for litigation.

Senate Bill 1976 puts brakes on easing workplace regulations

If Illinois’ lawsuit climate weren’t enough to discourage businesses operating in the state, lawmakers passed another bill that would prevent federal reductions in workplace regulations from taking effect in Illinois. SB 1976 would require state agencies to maintain the current level of workplace regulation established under federal wage and hour laws, federal coal mine safety law, and under the Occupational Safety and Health Act as of April 28, 2025, even if the federal government reduces those regulations.

What this means in practice: even if the federal government loosens regulations to make it easier to do business, Illinois will be stuck with current regulations as they are. That leaves the state less flexible to adapt to often rapidly changing workplace environments.

Advocates will argue this measure will protect workers from federal deregulation that disregards worker safety. What it really does is prevent state agencies from adopting looser restrictions that state regulators themselves may judge to be reasonable and appropriate. Counterintuitively, overregulation can make workplaces less safe, partially because as the burden of regulation increases, compliance falls and enforcement is more difficult.

If state agencies judge any federal deregulation to be unwise, most agencies already can make rules requiring more stringent regulations. If they lacked it, the legislature could have instead granted agencies that authority. But lawmakers have instead substituted their own judgment, disallowing any reduction in regulations, no matter how reasonable.

Illinois is already one of the most regulated states in the country. It ranks as the 10th-most burdened state when it comes to federal regulations, according to the Mercatus Center’s Federal Regulation and State Enterprise index. And at the state level, Illinois’ administrative code contained more instances of restrictive language than 44 other states and Washington, D.C.

That translates to real harm – higher levels of business regulation are associated with increased levels of poverty, while lower levels of regulation correlate with decreased poverty. Illinois should welcome opportunities to reduce regulations, not blindly reject them.

If Pritzker signs these bills into law, companies have two more reasons to avoid the state’s already terrible business climate. If he wants the state to prosper, he should be looking for ways to attract more businesses: vetoing both these bills would be a good start.