In Illinois, deductions from paychecks must be done very carefully. Illinois employers need to be aware of the tricky web of laws and regulations which often prevent the employer from simply deducting, unilaterally, from the employee's paycheck-even when the employer is merely paying the Company back for a loan taken out by the employee.
Placing new legal burdens on employers in Illinois, on August 26, 2018, Governor Rauner signed into law an amendment to the Illinois Wage Payment and Collection Act (IWPCA), requiring employers to reimburse their employees for all expenses within the scope of "necessary expenditures incurred by the employee within the employee's scope of employment and directly related to services performed for the employer." The statute defines "necessary expenditures" as all reasonable expenditures required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer.
In a rare and somewhat unexpected action, the Illinois Department of Labor, which is not perceived as an "employer-friendly agency," recently amended the requirements that are imposed on employers when making deductions from employee wages.
The brilliant Illinois legislature has recently recognized payroll cards as an approved method of wage payment in the State of Illinois. This measure has passed the House (House Bill 5622) after receiving prior approval from the Senate and now awaits Governor Pat Quinn's signature. The author believes that this group is the reincarnation of Nero "who fiddled while Rome burned." As presently written, the Illinois Wage Payment and Collection Act expressly provides only for the payment of wages via Cash or via Check or via Direct Deposit and makes no mention whatsoever of payroll payment cards. Obviously, this dichotomy as to what the Illinois Wage Payment and Collection Act states and what the Illinois legislature has recently done, creates a quandary.