Illinois Loans: What you need to know

In general, a deduction from pay may only be made with the express written consent of the employee, given freely at the time of the deduction. In addition, an advance on wages may be repaid through payroll deductions only when both the employer and employee have signed a prior written agreement specifying the amount of the advance, a repayment schedule, and the method of repayment (56 IL Admin. Code Sec. 300.750). The agreement may be made either at the time of the deduction or at the time of the advance (56 IL Admin. Code Sec. 300.720). These requirements do not apply to funds transmitted by wire to employees who are traveling, if a signed authorization is not practicable (56 IL Admin. Code Sec. 300.790).
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A cash advance repayment agreement may not provide for a repayment schedule of more than 15 percent of an employee's gross wages per paycheck (56 IL Admin. Code Sec. 300.800). If an employee leaves a job owing more than 15 percent of his or her last paycheck, the employer may deduct the entire balance due, but only if the employee agreed to such an arrangement when the advance was made (56 IL Admin. Code Sec. 300.810).
Acceptance by an employee of a disputed paycheck is not considered evidence that the employee has consented to the deduction. If an employee disputes a deduction from his or her wages, the employer must notify the Department of Labor in writing. The notice must be either typewritten or clearly handwritten and should include the name and last known address of the employee from whose wages or final compensation the deduction is being made; the amount that is being withheld; the reason for which the deduction is being made; the date on which payment would have been made; and the ...

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