State of Illinois
2013 and 2014


Introduced , by Rep. Arthur Turner


820 ILCS 115/2  from Ch. 48, par. 39m-2
820 ILCS 115/4  from Ch. 48, par. 39m-4
820 ILCS 115/14.5 new

    Amends the Illinois Wage Payment and Collection Act. Establishes requirements for the use of payroll cards by employers. Provides that receipt of wages by means of a payroll card may not be a condition of employment. Requires certain disclosures to be made to employees before using payroll cards. Requires the offer of an alternative means of payment to be available. Establishes limits on fees. Effective January 1, 2015.

LRB098 19212 JLS 54364 b






HB5622LRB098 19212 JLS 54364 b

1    AN ACT concerning employment.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 5. The Illinois Wage Payment and Collection Act is
5amended by changing Sections 2 and 4 and by adding Section 14.5
6as follows:
7    (820 ILCS 115/2)  (from Ch. 48, par. 39m-2)
8    Sec. 2. For all employees, other than separated employees,
9"wages" shall be defined as any compensation owed an employee
10by an employer pursuant to an employment contract or agreement
11between the 2 parties, whether the amount is determined on a
12time, task, piece, or any other basis of calculation. Payments
13to separated employees shall be termed "final compensation" and
14shall be defined as wages, salaries, earned commissions, earned
15bonuses, and the monetary equivalent of earned vacation and
16earned holidays, and any other compensation owed the employee
17by the employer pursuant to an employment contract or agreement
18between the 2 parties. Where an employer is legally committed
19through a collective bargaining agreement or otherwise to make
20contributions to an employee benefit, trust or fund on the
21basis of a certain amount per hour, day, week or other period
22of time, the amount due from the employer to such employee
23benefit, trust, or fund shall be defined as "wage supplements",



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1subject to the wage collection provisions of this Act.
2    As used in this Act, the term "employer" shall include any
3individual, partnership, association, corporation, limited
4liability company, business trust, employment and labor
5placement agencies where wage payments are made directly or
6indirectly by the agency or business for work undertaken by
7employees under hire to a third party pursuant to a contract
8between the business or agency with the third party, or any
9person or group of persons acting directly or indirectly in the
10interest of an employer in relation to an employee, for which
11one or more persons is gainfully employed.
12    As used in this Act, the term "employee" shall include any
13individual permitted to work by an employer in an occupation,
14but shall not include any individual:
15        (1) who has been and will continue to be free from
16    control and direction over the performance of his work,
17    both under his contract of service with his employer and in
18    fact; and
19        (2) who performs work which is either outside the usual
20    course of business or is performed outside all of the
21    places of business of the employer unless the employer is
22    in the business of contracting with third parties for the
23    placement of employees; and
24        (3) who is in an independently established trade,
25    occupation, profession or business.
26    The following terms shall apply to an employer's use of



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1payroll cards to pay wages to an employee under the
2requirements of this Act:
3    "Payroll card" means a card issued to an employee by an
4employer or other payroll card issuer as a means of accessing
5the employee's payroll card account.
6    "Payroll card account" means an account into which an
7employer directly or indirectly deposits each participating
8employee's wages on a recurring basis through an electronic
9fund transfer.
10    "Payroll card issuer" means an employer, bank, financial
11institution, or other entity that issues a payroll card to an
12employee under an employer payroll card program.
13(Source: P.A. 94-1025, eff. 7-14-06.)
14    (820 ILCS 115/4)  (from Ch. 48, par. 39m-4)
15    Sec. 4. All wages earned by any employee during a
16semi-monthly or bi-weekly pay period shall be paid to such
17employee not later than 13 days after the end of the pay period
18in which such wages were earned. All wages earned by any
19employee during a weekly pay period shall be paid not later
20than 7 days after the end of the weekly pay period in which the
21wages were earned. All wages paid on a daily basis shall be
22paid insofar as possible on the same day as the wages were
23earned, or not later in any event than 24 hours after the day
24on which the wages were earned. Wages of executive,
25administrative and professional employees, as defined in the



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1Federal Fair Labor Standards Act of 1938, may be paid on or
2before 21 calendar days after the period during which they are
4    The terms of this Section shall not apply, if there exists
5a valid collective bargaining agreement which provides for a
6different date or for different arrangements for the payment of
8    Employers shall pay to workers on strike or layoff, no
9later than the next regular payday, all wages earned up to the
10time of such strike or layoff.
11    Any employee who is absent at the time fixed for payment,
12or who for any other reason is not paid at that time, shall be
13paid upon demand at any time within a period of 5 days after
14the time fixed for payment; and after the expiration of the 5
15day period, payment shall be made upon 5 days demand. Payment
16to the absent employee shall be made by mail if the employee so
17requests in writing.
18    All wages and final compensation shall be paid in lawful
19money of the United States, by check, redeemable upon demand
20and without discount at a bank or other financial institution
21readily available to the employee, or by deposit of funds in an
22account in a bank or other financial institution designated by
23the employee, or by a payroll card that meets the requirements
24of Section 14.5. No employer may designate a particular
25financial institution, bank, savings bank, savings and loan, or
26currency exchange for the exclusive payment or deposit of a



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1check for wages. No financial institution, bank, savings bank,
2savings and loan, or currency exchange shall refuse to honor a
3check for wages that exclusively designates, in violation of
4this Section, a particular bank, savings bank, savings and
5loan, or currency exchange as the exclusive place of payment or
6deposit except to the extent the bank, savings bank, savings
7and loan, or currency exchange is otherwise excused from
8honoring the check under Section 3-111 of the Uniform
9Commercial Code because the bank, savings bank, savings and
10loan, or currency exchange is not the drawee or the maker of
11the check.
12(Source: P.A. 89-364, eff. 8-18-95.)
13    (820 ILCS 115/14.5 new)
14    Sec. 14.5. Payroll cards. An employer using a payroll card
15to pay an employee's wages shall meet the following
17        (1) The employer shall not make receipt of wages by
18    payroll card a condition of employment for any employee.
19        (2) The employer shall not initiate payment of wages to
20    the employee by electronic fund transfer to a payroll card
21    account unless:
22            (A) the employer provides the employee with a
23        written disclosure, in plain language, explaining the
24        terms and conditions of the payroll card account
25        option, including:



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1                (i) an itemized list of all fees that may be
2            deducted from the employee's payroll card account
3            by the employer or payroll card issuer; and
4                (ii) a notice that third parties may assess
5            transaction fees in addition to the fees assessed
6            by the employee's payroll card issuer;
7            (B) the employer also offers the employee the
8        options of payment by paper check or direct deposit to
9        a depository account designated by the employee; and
10            (C) the employer obtains the employee's voluntary
11        written consent to receive the wages by payroll card.
12        (3) A payroll card program offered by the employer
13    shall provide the employee with:
14            (A) at least one ATM withdrawal per pay period at
15        no cost to the employee and at a location within a
16        reasonable distance of the employee's place of
17        employment;
18            (B) at least one method of withdrawing the entire
19        balance on the card for each pay period without
20        incurring a fee;
21            (C) at the employee's request, one transaction
22        history each month that includes all deposits,
23        withdrawals, deductions, or charges by any entity from
24        or to the employee's payroll card account at no cost to
25        the employee; and
26            (D) a reasonable method for the employee to obtain



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1        the payroll card account balance on the payroll card at
2        any time without incurring a fee.
3        (4) An employer may not use a payroll card program that
4    includes fees for account inactivity, declined
5    transactions, point of sale transactions, or an
6    application, initiation, loading, participation, or any
7    other fee to receive wages or to hold the payroll card.
8        (5) The payroll card or payroll card account may not be
9    linked to any form of credit including, but not limited to,
10    a loan against future pay or a cash advance on future pay.
11        (6) An employee paid wages by payroll card may request
12    to be paid wages by any other method set forth in Section
13    4. Following the request, the employer shall, within 2 pay
14    periods, begin payment to the employee by the allowable
15    method requested by the employee.
16    Section 99. Effective date. This Act takes effect January
171, 2015.