Employers Must Pay Fines for Violations of Illinois Wage Payment and Collection Act

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On May 25, 2021, both houses of the Illinois General Assembly approved a amendment the state law on the payment and collection of wages (“the law”). The change would require employers who break the law to pay damages of 5% of the amount of any underpayment of wages, compensation or pay supplements for each month following the date of payment in which the amount (s) owed. remain unpaid. This represents a 150% increase in the penalty, since the legal rate before this amendment was 2%. The measure will take effect upon signature by Governor JB Pritzker.

the Act covers private employers as well as local government units, including school districts, but exempts state and federal employees. It requires that the wages of non-exempt workers be paid at least twice a month, and that executive, administrative and professional employees, as defined by the federal Fair Labor Standards Act (FLSA), be paid at least once a month. . It limits the time between the dates of taking wages and paying wages, depending on whether an employer’s pay period is weekly, bi-weekly or bimonthly, and sets out specific rules for the final payment of wages and compensation. upon termination of an employee’s employment. the employer. Notably, the law requires employers in Illinois to pay departing employees the full dollar value of any unused accrued vacation at the employee’s final rate of pay, and prohibits any employment contract or policy from providing for the loss of employees. vacation earned during separation. Employers are also prohibited by law from making deductions from wages or final indemnity unless required by law or a valid order, for the benefit of the employee, with express written consent, or for certain garnishments authorized by law.

Failure to comply with the law can be costly for an employer: Employees who are not paid according to mandatory deadlines can file a complaint with the state Department of Labor or take legal action. In addition to the recovery of all underpayments and damages, a successful claimant will also be entitled to legal costs and fees, and the employer will also be liable to fines of up to $ 1,000. If the violation of the Act by an employer is found to be willful or fraudulent in nature, the employer will also be found guilty of a misdemeanor. Repeat offenders can be convicted of a crime.

The amendment to the Act only changes the severity of the penalty for non-compliance, not the substantive requirements imposed on employers. Nonetheless, now is a good opportunity for Illinois employers to ensure their exposure is limited by ensuring their compensation practices are fully compliant with the law.

© 2021 Epstein Becker & Green, PC All rights reserved.Revue nationale de droit, volume XI, number 148

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