Legal Question in Employment Law in Illinois

I'm in the State of Illinois can the employer hold back any part of final pay until the employee returns company assets i.e laptop, cell phone etc.. and are the rules the same for exempt and non exempt employees.


Asked on 2/03/15, 11:11 am

1 Answer from Attorneys

Betty Tsamis Tsamis Law Firm PC

Pursuant to Illinois law your employer cannot make a deduction pending return of company property. This is the rule regardless of whether you are exempt or not. Illinois' deduction law was revised in August 2014 making it easier for employers to enter into willing deduction agreement with employees. However, these changes do not help your former employer and Illinois law expressly prohibits the deduction you have personally ordered. Specifically, 820 ILCS �115/9 provides:

Deductions by employers from wages or final compensation are prohibited unless such deductions are (1) required by law; (2) to the benefit of the employee; (3) in response to a valid wage assignment or wage deduction order; (4) made with the express written consent of the employee, given freely at the time the deduction is made. . . .

Further Illinois� Wage Payment and Collection Act regulations provide:

Section 300.620 Individual Liability of Officers, Agents or Other Persons

a) As a result of PA 96-1407, any person, including corporate officers, agents or any person who acts directly or indirectly in the interest of an employer in relation to an employee is an employer under Section 2 of the Act and may be held individually liable for wages and final compensation. For example, any person, including corporate officers and agents, acting directly or indirectly in the interest of an employer, includes, but is not limited to, actions such as being a signatory to an employment or union contract, or otherwise maintaining a decision-making role with regards to employment decisions and/or payment of employees. In evaluating whether any person, including officers and agents, are individually liable under the Act, the "economic realities test" is the appropriate standard and, although no one factor is dispositive, the relevant inquiry is whether the person:

1) held significant ownership interest in the corporation or entity;

2) exercised operational control over significant aspects of the corporation's and/or entity's day-to-day functions, including the compensation of employees, or had supervisory authority over employees and was responsible in whole or in part for the alleged violation; and

3) was personally involved in the decision to continue operations despite financial adversity during the period of nonpayment.

b) In addition to an individual who is deemed to be an employer pursuant to Section 2 of the Act, Section 13 of the Act allows for a separate and independent basis for liability for any agents of an employer who knowingly permit the employer to violate the provisions of the Act. Such a person may be deemed to be an employer of the employees of the corporation and shall be individually liable for a claimant's wages or final compensation. For example, individual liability would attach when an individual exercises sufficient control to allocate to whom or what entity the funds would be paid and in what amount (i.e., no paychecks, full paychecks or partial paychecks) during the relevant time period.

c) As used in subsection (b):

1) "Knowingly" means knowledge of the existence of facts constituting the alleged violation, rather than a knowledge of the unlawfulness of the act or omission.

2) "Permit" means to allow to happen or to fail to prevent, regardless of the corporation's ability to pay.

(Source: Amended at 38 Ill. Reg. 18517, effective August 22, 2014)

Illinois law additionally provides for penalties, interest (2%) per month for non-payment, reasonable attorney fees and costs, and misdemeanor and/or felony charges for employers and their agents.

So, it seems to me your employer owes you some money. Good luck!

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Answered on 2/04/15, 12:26 pm


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