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Public Act 099-0903
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| SB2804 Enrolled | LRB099 18541 HEP 44880 b |
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AN ACT concerning civil law.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Wage Assignment Act is amended by |
changing Sections 2, 2.1, 2.2, 4.1, and 4.2 as follows:
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(740 ILCS 170/2) (from Ch. 48, par. 39.2)
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Sec. 2.
Demand on an employer for the wages of wage-earner |
by virtue of a
wage assignment may not be served on the |
employer unless:
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(1) There has been a default of more than 40 days in |
payment of the
indebtedness secured by the assignment and |
the default has continued to the
date of the demand;
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(2) The demand contains a correct statement as to the |
amount the
wage-earner is in default and the original or a |
photostatic copy of the
assignment is exhibited to the |
employer; and
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(3) Not less than 20 days before serving the demand, |
notice required under Section 2.2 a notice of
intention to |
make the demand has been served upon the employee, and an
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advice copy sent to the employer, by 2 methods: (i) first |
class mail; and (ii) registered or certified mail.
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Service of any demand without complying with this Section |
has no legal
effect. Proof of certified mail is prima facie |
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evidence of service.
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A demand under this Section applies only to wages due at |
the time of
service of the demand and upon subsequent wages |
until the total amount due
under the assignment is paid, or, if |
the wage assignment is revocable under federal law, until the |
employee revokes it or until the expiration of the employer's
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payroll period ending immediately prior to 84 days after |
service of
such demand, whichever first occurs.
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(Source: P.A. 88-395.)
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(740 ILCS 170/2.1) (from Ch. 48, par. 39.2a)
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Sec. 2.1. A demand shall be in the following form:
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"Demand is hereby made upon an assignment of salary, wages, |
commissions
or other compensation for services, executed by |
.... and delivered to ....
on (insert date), to secure a debt
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contracted on (insert date).
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The total amount of the debt is $..... Payments in the |
amount of $....
have been made. The duration of the contract is |
.... months. There is now
due and owing without acceleration |
the sum of $...., the last payment
having been made on (insert |
date).
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The employee herein named has been in default in his |
payments in the
amount of $...., of which $.... has been due |
and owing for more than 40
days.
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Unless you have received a written notice from the employee |
herein named revoking the wage assignment within the past 20 |
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days, or do receive within 5
days after the service hereof, a |
notice of defense from the employee herein
named, you are |
required by law to make payment in accordance with such
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assignment. ...., first being duly sworn, deposes and says that |
the facts
stated in the demand above are true and correct; and |
further deposes and
says that he (or his principal, if he is an |
agent for the assignee) has not received notice from the debtor |
that he or she is revoking the wage assignment no
notice of any |
defenses of the debtor.
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Payments must be made until the total amount due under the |
assignment is paid or until the employee revokes the wage |
assignment. |
...........................
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Subscribed and sworn to before me on (insert date).
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...........................
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Notary Public".
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(Source: P.A. 91-357, eff. 7-29-99.)
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(740 ILCS 170/2.2) (from Ch. 48, par. 39.2b)
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Sec. 2.2. Forms; notice of intent to assign wages; |
revocation. |
(a) The notice to an employee required by Section 2 shall |
be in the
following form:
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"NOTICE OF INTENT TO ASSIGN WAGES
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This notice is required by the Illinois Wage Assignment |
Act. The notice
has been sent to tell you that a creditor (name |
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and address listed below)
plans to have your wages assigned. A |
wage assignment is a document you signed at the time you signed |
the contract for your debt. It authorizes your creditor to |
receive a portion of your wages directly from your employer, in |
order to pay your debt. This notice contains important |
information about the debt and what your options are.
You |
should read the entire notice carefully.
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WHY THE CREDITOR WANTS TO ASSIGN YOUR WAGES
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You signed a wage assignment on ....... (date) .......
The |
wage assignment was signed as security if you failed to make |
payment
on the contract you signed on ......... (date) |
..........
A copy of the wage assignment is attached. The |
creditor's records show
that you have not made a payment since |
......... (date) ....... and that
you now owe $........ on the |
contract. The creditor will send
a demand for wages to your |
employer 20 days from the date you receive this.
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WHAT YOU CAN DO TO PREVENT YOUR WAGES FROM BEING ASSIGNED
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If you have a legal defense to the wage assignment you can |
stop the wage
assignment by filling out the enclosed Notice of |
Defense Form and (1) sending
it to the creditor by registered |
or certified mail and (2) giving a copy to
your employer. You |
must do those 2 things within 20 days of receiving this
notice. |
You have the right to contact an attorney concerning the wage |
assignment.
In the event a false defense is made, you will be |
subject to payment of
attorneys' fees, court costs and other |
expenses.
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The creditor's name, and address, and phone number are:
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......................
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......................
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......................
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......................
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(Signed by)"
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(b) If the wage assignment is revocable under federal law, |
the notice required under subsection (a) shall also include the |
following: |
UNDERSTANDING YOUR CHOICES UNDER THE |
ILLINOIS WAGE ASSIGNMENT ACT |
There are options available to you in this process. You |
should consider your options and determine the one that is best |
for you. You have the right to contact an attorney at any point |
concerning the wage assignment, or to help you determine your |
best option. |
Your options include: |
(1) You can stop the wage assignment at any time, which |
will stop your wages from being deducted. It will not |
eliminate your debt, and interest may continue to accrue. |
You may contact your creditor for more information about |
the interest rate on your contract, and to determine how |
much interest might accrue if you stop the wage assignment. |
Your creditor will still be able to pursue other means |
of collecting any debt you may owe, including filing a |
lawsuit against you for the full amount owed under the |
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contract and any interest that might accrue. A lawsuit |
might result in you owing legal fees and other costs. |
You can stop the wage assignment by filling out the |
enclosed Revocation Notice Form, or by writing a letter |
stating that you are revoking the wage assignment. Send the |
Revocation Notice Form or letter by registered or certified |
mail to the creditor, at the address listed above. It is |
highly recommended that you give a copy of the Revocation |
Notice Form or letter to your employer so your employer can |
stop any pending payments. |
If you choose to write a letter, it should be addressed |
to the creditor, and should include: |
(i) your name; |
(ii) the account number; and |
(iii) a statement that you are revoking the wage |
assignment, such as, "I am revoking the wage |
assignment." |
Even if the wage assignment has already begun, you can |
still stop it now or at any point in the future. |
(2) You can do nothing, and allow the wage assignment |
process to proceed. Starting in 20 days, part of your wages |
will be sent directly to the creditor to pay off your debt. |
This will reduce your take-home pay every pay period until |
the total amount of the debt is repaid. |
Up to 15% of your wages will be sent to the creditor |
every pay period. Once the total amount is repaid, the |
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creditor will send a notice to you and to your employer |
that includes the creditor's name, your name, and the |
account number, stating that the wage assignment is closed |
and no further wages should be assigned. |
(3) You can contact your creditor to repay the debt, or |
to explore other options, including a repayment plan or |
refinancing, if available. You can contact your creditor at |
the address and phone number listed above. |
If you agree on another repayment option with your |
creditor, the creditor will send a notice to your employer |
stating that your wages should not be assigned. |
(c) If the wage assignment is revocable under federal law, |
the notice required under subsection (b) shall be accompanied |
by the following Revocation Notice Form, with the relevant |
information inserted by the creditor: |
"REVOCATION NOTICE |
The employee's name and address are: |
...................... |
...................... |
...................... |
...................... |
The creditor's name and address are: |
...................... |
...................... |
...................... |
...................... |
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Re: (insert account number) |
I, (insert name), hereby revoke the wage assignment I |
signed on (insert date the wage assignment was signed). You no |
longer have my permission to use this wage assignment.
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...................... ...................... |
(Signed by) (Date)" |
(Source: P.A. 83-867.)
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(740 ILCS 170/4.1) (from Ch. 48, par. 39.4a)
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Sec. 4.1. Revocation of wage assignment. If the wage |
assignment is revocable under federal law, the employee may |
revoke the wage assignment at any time by submitting the |
Revocation Notice Form as provided in subsection (c) of Section |
2.2 of this Act or otherwise providing written notice of |
revocation to the creditor. Revocation is effective regardless |
of how the creditor receives it. Failure to use the sample |
language provided in the notice described in Section 2.2 does |
not affect the validity of the written notice of revocation. |
The employee may submit a copy of the notice to his or her |
employer. If the written notice of revocation is served upon |
the creditor prior to the creditor's service
of demand upon the |
employer, the demand shall not be served. Within 20 days after |
receiving the notice required by Section 2
or within 5 days |
after service of the demand, the employee may notify his
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employer, in writing, of any defense he may have to the wage |
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assignment. A
copy of such notice shall be served upon the |
creditor by registered or
certified mail. If served upon the |
creditor prior to the creditor's service
of demand upon the |
employer, such demand shall not be served by the
creditor. The |
notice shall be by affidavit and shall be in substantially
the |
following form:
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"I, ...., hereby (swear) (affirm) that I have a bona fide |
defense to the
claim of ...., which claim is based on a debt |
contracted on (insert date), and for security on which debt a |
wage
assignment was executed.
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..............................
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Address for service of summons
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..............................
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Employee
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Subscribed and sworn to before me on (insert date).
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............................."
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Notary Public
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(Source: P.A. 91-357, eff. 7-29-99.)
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(740 ILCS 170/4.2) (from Ch. 48, par. 39.4b)
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Sec. 4.2.
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If the employee has not served a Revocation Notice Form as |
provided in Section 4.1 of this Act or has not otherwise served |
the creditor with a written notice of revocation (if the wage |
assignment is revocable under federal law) given notice of |
defense as provided in this Act
within 20 days after receiving |
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the notice of intention to make a demand,
the creditor may |
proceed with his demand, and the employer shall commence
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payment to the creditor not sooner than 5 business days after |
service of
such demand, if no revocation notice has been |
received by the employer unless a notice of defense is received |
within that 5 day
period. If the employee cures the default |
stated in the demand or revokes the wage assignment, the
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creditor shall notify the employer and release the demand. No |
employer
shall be liable for payments made in compliance with |
this Section.
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If a Revocation Notice Form as set forth in Section 4.1 of |
this Act or other written notice of revocation from the |
employee is received by an employer, If a notice of defense is |
received by an employer within the period
specified in Section |
4.1, no wages are subject to a demand served by the
creditor |
for that wage assignment and the employer shall cease any |
deduction of wages currently taking place for that wage |
assignment, described in that notice of defense; unless the |
employer receives
a copy of a subsequent written agreement |
between the creditor and employee
authorizing such payments. If |
such an agreement is not reached, the
creditor may not |
institute further proceedings on the wage assignment. If a
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notice of defense has been given, service of summons in any |
subsequent
proceeding on the debt for which the wage assignment |
was given as security
may be made by registered or certified |
mail.
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