Illinois Punishes Wage Theft

 In Employment Law, Overtime Law, Wage Law

Wage theft by employers is illegal. Wage theft is prohibited by federal law and several states have enacted additional state laws that are designed to further prevent and stop wage theft. Employers can and are punished for engaging in wage theft, even if the wage theft is “accidental.” Wage theft is illegal in all 50 states under federal law.

Illinois Wage Law Increases Punishment for Wage Theft

Recently, various states across the country (Virginia and Minnesota are two examples) have increased punishments for wage theft. In 2021, Illinois substantially increased the punishments for employers who engage in wage theft. Under the previous rule, employees who were underpaid their wages, overtime, or any other compensation due had a right to recover not only their unpaid compensation and statutory damages, but also penalties amounting to 2% for each month that the compensation that was not paid. Under the new Illinois wage law, the employer penalty was increased from 2% to 5%.

This is important for workers because sometimes, unpaid compensation claims can take years to be resolved through the administrative and court processes. Consider an example where an employee is underpaid by $1,000. For each month that passes, the employee is entitled to recover an extra 5%, or $50 each month. If the case takes 12 months to conclude, that is an extra $600 that an employee can recover.

Moreover, the extra 5% entitlement “looks backwards in time.” That is, the extra 5% accumulates prior to any administrative claim or lawsuit being filed. For example, if the $1,000 in unpaid wages should have been paid in January 2019, but the unpaid wage claim is not filed until January 2020, the unpaid workers can recover the extra 5% for each month in 2019. This is a significant punishment for wage theft. Employers will be highly motivated to pay their employees what their employees are due. If you think that your employer has underpaid your wages or overtime, you should contact experienced employee rights attorneys like the ones at Herrmann Law. Your rights can and should be protected.

The new Illinois law tracks changes enacted in 2019 with respect to other areas of Illinois employment law. In 2019, Illinois increased its state minimum wage and added the extra 5% penalty for employers who violated the minimum wage increases and failed to pay overtime. Now the 5% right of recovery applies to ALL wage-related violations including underpayment of wages, miscalculation of overtime pay, theft of tips and other failures to pay employees their full compensation. As noted above, Illinois employees can also recover “statutory damages.” These are defined as money damages amounting to three times the unpaid compensation. Thus, in our example above, the employee would be entitled to recover $1,000 in unpaid compensation, plus $3,000 in statutory damages and also the monthly 5% employer penalty. Employers can also be fined by the state for every violation amounting to 20% of the amount of underpayment paid into the state’s wage theft enforcement fund.

Like many states that have recently enacted wage theft laws to protect employees, Illinois has become serious about combatting employer wage theft.

Call the Employee Rights Attorneys at Herrmann Law Today

For more information, call the Employee Rights attorneys at Herrmann Law. If you think that your employer has violated your rights as an employee, call us. We are proven, experienced, employee-focused attorneys representing workers across the United States in all types of workplace disputes. Use our Online Contact page or call us at (817) 479-9229.

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