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4 Things Employers Need To Know About Minimum Wage Changes in Illinois

On Behalf of | Sep 22, 2022 | Firm News

The new wage laws went into effect on January 1, 2022. On the state level, the minimum wage rose to $12 per hour. For employees who earn tips as part of their wages, the minimum hourly payment is $9.25 per hour, provided that tips get the employee to the $12 rate The hourly rate for Chicago is higher. Here is what Illinois employers need to know about the new wage laws and changes.

1. Age Matters

Employees who are younger than age 18 and work less than 650 calendar hours for a year do not fall under the new wage laws. Those that are less than 18 years of age but do work more than 650 hours in a calendar year must be paid the new minimum wage ($12 per hour) or the equivalent with wages and tips for tipped workers.

2. Tipped Employees and Wages

Tipped employees are a potential pitfall under the new wage laws. Employers may pay them as little as 60 percent of the minimum wage so long as their tipped income for that shift, brings them to or above the $12 wage mark, per shift. If their tips plus wages do not equal $12 per hour, you, the employer must pay them the difference.

3. The Burden of Compliance Falls on Employers

Each employer is burdened with understanding and implementing the new wage laws. If an employer uses a payroll service they are responsible for informing the payroll service of these changes. Every paycheck is expected to be correct as the new minimum wage laws apply to that worker, including tipped workers, especially when their tips do not get them to the minimum wage under these new laws.

4. Exceptions to these Laws

● Chicago – The minimum wage in Chicago is higher than the wage laws in Illinois. As of July 1, 2022, Chicago employers will pay minimum wage employees $15.40 per hour when those employers have more than 21 employees. For businesses with fewer than 21 employees, the minimum wage in Chicago is $14 per hour. The hourly rate changes on July 1st of each year.
● Cook County – The minimum wage in Cook County is $13 per hour for all employees who do not also earn tips and when that business has four or more employees.
If the employer is in Chicago or another municipality with a different wage scale, and the employee works from home or is a remote worker, they are considered to be workers within the municipality where the employer is located.

Contact Goldman & Ehrlich For More Information Regarding Minimum Wage in Illinois

The new wage laws for Illinois are designed to help create livable wages for the people of Illinois. There are gray areas, and both employers and employees must understand how these laws impact their income. Learn more about how the new minimum wage laws impact you by reaching out to our team. Goldman & Ehrlich is an employment law firm with the experience to help you understand your rights for fair payment. Call us today, for more information.

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