Unpaid Wages and Overtime

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In Illinois, all non-exempt hourly employees must earn at least the minimum wage, and must be paid time and a half (“overtime”) for all hours in excess of forty per work week. Minimum wage and overtime are governed by a number of state and federal statutes, including the Illinois Wage Payment and Collection Act (“IWPCA”), Illinois Minimum Wage Law (“IMWL”), and Fair Labor Standards Act (“FLSA”).

The FLSA contains provisions setting the federal minimum wage. Currently, the federal minimum wage is $5.85 per hour. The IMWL contains provisions setting the state minimum wage for Illinois, currently at $7.50 per hour. If both the FLSA and the IMWL apply to an employee, the employee is entitled to earn the higher of the minimum wages set forth in the statutes.

The FLSA and IMWL each contain overtime provisions which mandate that non-exempt hourly employees must be paid time and a half for all hours worked in excess of forty hours in one work week. An employee cannot waive his or her right to overtime compensation, and must be compensated for all time worked. However, certain workers, particularly salaried employees, may be exempt from the overtime provisions of the FLSA.

The FLSA and IMWL apply to any employer of at least one employee, and may apply to employees who have not been paid minimum wage, or who have not been paid for overtime work, time spent donning and/or doffing, meal time, or travel time. Employers who “round” their employees’ clocked time may also face penalties under the FLSA and IMWL.

If an employer has violated the FLSA or IMWL, the employer may be subject to either an individual or class civil action in federal court. Under the FLSA and IMWL, an employee can collect unpaid wages for the period of two years preceding the filing of a complaint. If the employer knew of the violation and committed the violation willfully, the employer can recover one additional year of unpaid wages. Further, an employee is entitled to recover an amount equal to the unpaid wages in liquidated damages, as well as reasonable attorneys’ fees and costs.

The IWPCA mandates that employers in Illinois must pay each employee for all time that the employee worked, within two weeks of the end of the period in which the wages were earned. The IWPCA further regulates final compensation upon the end of employment, and makes it unlawful for any employer to deduct wages from an employee’s paycheck without the written consent of the employee.

An employer acting in violation of the IWPCA may have to pay the employee up to twice the sum of the unpaid wages, plus a statutory penalty of two percent for each day that the payment is past due.

If you have questions about your rights under the FLSA, IMWL, or IWPCA, or feel that your employer may have violated the FLSA, IMWL, or IWPCA contact Caffarelli & Siegel Ltd. to speak to a Chicago Employment lawyer

FLSA White Collar Exemptions

Generally, under the FLSA, the federal law governing minimum wage and maximum hours, employees who are paid on an hourly basis must be paid overtime for any hours worked in excess of forty hours in one workweek. However, there are exemptions listed in the FLSA. Three of the most common exemptions for salaried employees are the Administrate, Executive, and Professional exemptions. If an employee can be classified as fitting into one of these categories, he/she will be exempt from the overtime provisions and will not receive overtime pay for hours worked in excess of forty in one workweek. These employees are called “exempt” employees.
The Professional exemption typically applies to professional individuals who usually have some sort of advanced degree. Examples might include doctors, lawyers, and Ph.D.s.

The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
The advanced knowledge must be in a field of science or learning; and
The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.

The Executive exemption typically applies to individuals who are managers and supervise at least two employees and have the power to hire/fire individuals.

The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and
The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.

The Administrative exemption is the most ambiguous, but generally it applies to salaried employees who perform office/non-manual work but who use significant degrees of discretion and independent judgment.

The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and

The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

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