Minimum Wage Increase Looms

William Hubbartt

While the U.S. Congress currently debates an increase to the federal minimum wage, legislators in Illinois have already acted on raising the floor for pay in Illinois to $7.50, to take affect July 1, 2007. The current Illinois minimum wage is $6.50 for adult workers. Amendments to the Illinois minimum wage act were signed into law in December by Governor Rod Blagojevich.

Following the $1.00 per hour increase in July of this year, the Illinois law also includes provisions for subsequent increases of 25 cents per hour on each succeeding July 1 in 2008, 2009 and 2010. At that time, the state minimum wage will be $8.25 per hour.

While labor groups applaud the minimum wage increase, employer and small business advocates fear that the increases will harm the economy and contribute to more job losses as businesses seek lower labor costs overseas.

The Illinois law now includes a provision permitting employers to pay newly hired workers 50 cents less or $7.00 per hour for the first 90 days of employment.

Employers may hire youths under the age of 18 at a reduced wage rate of $7.00 per hour. Youthful workers are protected under child labor laws from working in certain specified dangerous occupations.

The state minimum wage law also includes a provision for a reduced wage allowance for tipped workers. The minimum wage for tipped workers will raise from $3.90 to 4.50 per hour. For youths under 18, the tipped wage requirement will rise from $3.60 to $4.20.

The minimum wage law applies to all private and governmental employers. But, the definition for covered employees excludes certain agricultural workers including immediate family members of an agricultural employer, domestic service workers in a private home, outside sales workers, members of a religious organization, students at an accredited Illinois college who are subject to the federal wage hour law, and individuals working for an employer with fewer than 4 employees exclusive of the employer's parent, spouse, child or members of the immediate family.

The law further prohibits discrimination between employees on the basis of sex or mental or physical handicap by paying wages that are less than wages paid to workers performing substantially similar work. Compensation plans that provide a pay distinction based on seniority or merit, or quality or quantity of production or factor other than sex or mental or physical handicap are permitted.

The Illinois minimum wage law is enforced by the Illinois Department of Labor.. The employer is required post a summary of the act in the workplace and to keep records showing employees, hours worked and rates of pay.

Certain subminimum wage payments are permitted for learners and for handicapped workers subject to regulations defined by the Labor Department. Also, specified exemptions from the law are defined for camp counsellors.

An employer who violates the act may be subject to fines and penalties to include civil action for underpayment of wages and costs and attorney fees.

William S. Hubbartt is a human resources and privacy consultant and author of 8 books on management and privacy issues. 
Copyright 2007. All Rights Reserved.

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