Effective July 1, 2007, employers must pay workers the Illinois minimum wage of $7.50 per hour. The minimum wage applies to all workers except:
- Employees at organizations with fewer than four workers, not counting the employer’s immediate family.
- Most agricultural employees.
- Domestic service workers.
- Outside salespeople.
- Members of religious organizations.
- College students in work-study programs.
- Motor carriers as defined in the U.S. Transportation Department regulations.
The new state law allows employers to pay workers under 18 years of age $7 per hour, 50 cents less than the Illinois minimum wage.
For employees who receive tips, the tip credit is 40 percent of the minimum wage. Employers must substantiate that the employee’s wages and tips add up to the state’s minimum wage.
In addition, Illinois law permits employers to pay a lower wage to adults under specific circumstances. You can pay permanent workers who are in training 50 cents below the state’s minimum wage during their first 90 days on the job.
Keep in mind that the state has scheduled hikes in the minimum wage over the next several years. Effective July 1, 2008, the minimum wage increases to $7.75 per hour. In 2009, it rises to $8.00, and in 2010, to $8.25. Training wages and wages for underage workers will continue to lag 50 cents per hour behind the minimum wage, and the tip credit will remain at 40 percent.
The state law requires that you maintain a record of the name, address, occupation, pay rate, hours worked each day and amount paid to each employee for three years. Also, you must specifically note in your payroll records which employees earn the training wage.
The state administers the Minimum Wage Law through the Fair Labor Standards Division of the Illinois Department of Labor. For more information, go to www.state.il.us/agency/idol/.