Chicago
Since July 1, 2026, the Chicago minimum wage is $17.05 an hour for employers with 4 or more employees. It goes up every July 1 by the Consumer Price Index or 2.5%, whichever is lower, and the city's minimum wage page didn't state the July 1, 2027 rate as of October 20, 2026. Chicago also has its own Paid Leave and Paid Sick and Safe Leave Ordinance.
Two city rules change the payroll picture for a Chicago cleaning company: the minimum wage and the paid leave ordinance. This page covers who the wage reaches, how leave accrues, the notices the city requires, and a short word on Illinois sales tax. Payroll registration and the employee test are on bookkeeping for Illinois cleaning businesses.
As of July 1, 2026, Chicago's minimum wage is $17.05 an hour for employers with 4 or more employees; this page doesn't cover the rate for smaller employers. The city lists a tipped wage of $12.96, with the employer making up any shortfall to the full minimum wage. Under the Minimum Wage Ordinance the rate rises every July 1, by the Consumer Price Index or 2.5%, whichever is lower. The city's page didn't state the July 1, 2027 rate as of October 20, 2026.
Source: City of Chicago, Department of Business Affairs and Consumer Protection, Minimum Wage
Coverage turns on where the work happens. The city's fact sheet treats someone as a covered employee if they perform at least 2 hours of work in any two-week period for an employer while physically present within Chicago city boundaries, regardless of immigration status or where the employer is located. The Illinois statewide rate, for comparison, is $15.00 an hour, effective January 1, 2025.
Source: City of Chicago, BACP Office of Labor Standards, Chicago Minimum Wage fact sheet
Source: U.S. Department of Labor, Wage and Hour Division, State Minimum Wage Laws (updated July 1, 2026)
Source: Illinois Department of Labor, Illinois Minimum Wage Increasing on January 1 (December 17, 2024)
Chicago's Paid Leave and Paid Sick and Safe Leave Ordinance runs two balances side by side. Paid Leave accrues at 1 hour for every 35 hours worked, with accrual required as of July 1, 2024, and it's capped at 40 hours per 12-month period unless the employer sets a higher cap. Paid Sick Leave accrues at the same rate with the same 40-hour cap. The leave ordinance has its own coverage threshold: at least 80 hours for an employer within any 120-day period.
Source: City of Chicago, BACP Office of Labor Standards, FAQ: Paid Leave and Paid Sick and Safe Leave
Employers must post a notice at each Chicago facility covering the current minimum wage, Fair Workweek if it applies, Paid Leave and Paid Sick Leave, and Wage Theft. Covered employees also get a notice with their first paycheck, and again each year with a paycheck issued within 30 days of July 1.
Source: City of Chicago, Department of Business Affairs and Consumer Protection, Minimum Wage
The Illinois Department of Revenue says Illinois doesn't tax sales of service, so residential and commercial cleaning aren't taxable by inference; cleaning itself isn't named. Property transferred to the customer as an incident to a service can carry service occupation tax, and the detail is on my Illinois sales tax page. This page doesn't cover local taxes.
Source: Illinois Department of Revenue, Does Illinois tax sales of service?
Because the rate moves every July 1, Chicago labor costs change in the middle of the year, not in January. Chicago payroll isn't just a higher hourly rate. It's leave building at 1 hour per 35 worked, it's two balances that each top out at 40 hours unless you set them higher, it's a new wage every July 1 that the city's page didn't state yet for 2027. I record payroll at the wage you actually pay and keep each employee's leave balances in the books, and the job profitability estimator shows what $17.05 does to a single job.
I'm a bookkeeper, not a CPA or an Enrolled Agent. I keep wages and leave balances recorded accurately; whether the city ordinances cover a particular crew or job is a question for the city or an employment attorney, and tax questions go to your CPA.
Rules checked against the sources above as of October 20, 2026. Rates and rules change; confirm current figures with the agency or your CPA.
About Figure Eight Financial
Figure Eight Financial is Dave Gordon’s bookkeeping practice for residential and commercial cleaning companies. I work with owners in Chicago and across the country, and I’m a Certified QuickBooks Online ProAdvisor.
Before bookkeeping I studied computer science at Penn State and spent a career at IBM as an engineer, so I build the books as a system: data comes in once, lands in the right place, and ties back to a statement. I’m a bookkeeper, not a CPA or Enrolled Agent. I keep the books your CPA works from, and the tax decisions stay with your CPA.
Credentials and memberships reported by Figure Eight Financial.
More about DaveHow I Help
Chicago adds two moving parts to payroll: a wage that changes every July 1 and leave that accrues at 1 hour for every 35 worked. Wages get recorded at what you actually pay, and each employee's leave balances are kept so they tie back to the hours behind them. Book a short call below and tell me how your crews log hours today.
The core service. Transactions recorded and categorized, every account reconciled so the books and the bank agree, and monthly reports that arrive explained, split by residential and commercial and sliceable per contract.
The full picture of how this works for a cleaning companyFor the months where nothing got entered at all. I fill in the missing periods from the ground up, pulling bank feeds, statements, and receipts until every month has a complete set of records.
How catch-up bookkeeping worksFor books that exist but can’t be trusted. I audit what’s there, fix the unreconciled accounts, duplicate transactions, and wrong categories, and tie every balance back to a statement.
How cleanup bookkeeping worksYour crews paid on time, every pay period, with each payroll run recorded in the books so labor shows up against the jobs it belongs to.
How payroll worksRecurring invoices that match your contracts, an aging report you can trust, and follow-up on slow payers handled by a process instead of your evenings. Built for net-60 commercial accounts.
How invoicing and receivables workA file built right for a cleaning company from day one, or rebuilt after the DIY version drifts, and then I teach you to run it. I’m a Certified QuickBooks Online ProAdvisor, and this is honestly my favorite part of the job.
How a proper setup worksWe start with a short call about your business and where the books stand. The first conversation doesn’t cost anything.
I take a look at what you’ve got, your QuickBooks file, your spreadsheet, whatever exists.
You get a written proposal with the price, so the decision is yours with the number in hand.
Let's Connect
Running crews in Chicago and want leave balances and July wage changes showing up correctly in your books? Tell me how you track hours today. The first conversation doesn't cost anything.
