Illinois Wage Payment and Collection Act: an owner's cheat sheet
When Illinois employers must pay, what may come out of a paycheck and what late pay can cost, on one short page with slides, a chart and a checklist.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on October 29, 2026.
The Illinois Wage Payment and Collection Act (820 ILCS 115) covers when pay is due, which deductions are allowed and what late pay costs. Wage claims go to the Illinois Department of Labor (IDOL). Our Stub-to-Sendoff Pay Pass keeps it simple. The statute is on the Illinois General Assembly site.
- Covers all Illinois employers, but not employees of the State or federal governments.
- Most staff are paid at least twice a month; final pay is due by the next regular payday.
- Deductions need a legal basis or written consent.
- Late pay costs 5% of the amount per month, plus IDOL fees.
What the law asks
| Topic | What the law asks |
|---|---|
| Pay schedule | At least twice a month, except that monthly pay is allowed for executive, administrative and professional employees, and for commissions. |
| Worker or contractor | Anyone permitted to work is an employee unless all three independence tests are met. Placement businesses differ. |
The numbers
| Item | Amount or rule | Year |
|---|---|---|
| Unpaid wages | 5% of the shortfall for each month unpaid, plus attorney's fees if the worker sues | 2026 |
| IDOL fee, cannot be waived | $500, $750 or $1,250 (chart) | Since Aug. 1, 2025 |
| Ignoring a demand or order | Past 15 days (demand) or 35 (order), with no review sought: 20% of the amount owed goes to IDOL, plus 1% daily to the worker | 2026 |
| IDOL claim deadline | 1 year after the pay was due | 2026 |
Source: 820 ILCS 115/14(b)
Our checklist
Our Stub-to-Sendoff Pay Pass has five checks:
- Stub: hours, rate, gross pay, deductions and year-to-date totals.
- Schedule: timing rules met and payday notice posted.
- Deduction: legal basis or consent signed at the time.
- Expenses: a written claim policy.
- Sendoff: everything earned is paid by the next regular payday.
Mistakes people make
- Holding a last paycheck until a uniform or tool comes back. IDOL says it cannot be held for that.
- Making a shortage deduction with no agreement signed when it was taken.
- Calling someone a contractor without passing all three Illinois tests. The IRS tests differ.
Consider an attorney for an IDOL claim or demand letter. Overtime is on our FLSA page; IRS guidance says to keep employment tax records 4 years or more (small business compliance).
Common questions
What is the deadline for a wage claim with IDOL?
The limit is one year from the date the pay was due. Since November 2025 an IDOL pilot may turn away some claims, such as purely disputed bonus or severance claims. Workers may still sue.
Must earned vacation be paid at separation?
If a contract or policy promises paid vacation, yes: earned unused time is part of final pay, unless a union contract says otherwise.
Does a business with one employee count?
Yes. Any size counts, and officers or agents who knowingly allow a violation are treated as employers.
Official sources
- Illinois General Assembly: Wage Payment and Collection Act, 820 ILCS 115
- Illinois Department of Labor: Wage Payment and Collection
- Illinois Department of Labor: Wage Payment FAQ
- Illinois Department of Labor: Deductions from Pay FAQ
- Illinois General Assembly: Public Act 104-135 (IDOL fees from August 1, 2025)
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