Illinois sets its pay rules in the Illinois Wage Payment and Collection Act, 820 ILCS 115 (IWPCA): when employers must pay wages, what they may deduct and what late pay costs. The Illinois Department of Labor (IDOL) takes wage claims; employees may also sue in circuit court. This page is for owners of Illinois businesses with Canada or India ties, such as an Indian-owned LLC in Aurora making a first hire.
Who does the Illinois Wage Payment and Collection Act cover?
| Question | Answer |
|---|---|
| Which employers? | All Illinois employers, whatever the size; this takes in local governments and school districts |
| Who falls outside it? | Employees of the State or federal government |
| Who is an employee? | Anyone permitted to work, unless all three of these hold: the person is free from control and direction; the work falls outside the usual course of the business or all its places of business; and the person runs an independently established business. Placement agencies follow a different rule on the second condition. |
| Union employees? | Disputes under a union grievance procedure follow the union contract; overtime and prevailing-wage claims can go to IDOL |
What it means for a foreign-owned or cross-border business
| Situation | What the law says | What to check |
|---|---|---|
| Illinois LLC or corporation owned from Canada or India | Covered like any Illinois employer | Payday calendar, pay stubs, final-pay date |
| Owner or officer abroad who approves payroll | Any officer or agent who knowingly permits a violation is treated as an employer | Who signs off on deductions and final pay |
| Employee who works outside Illinois | IDOL requires work performed in Illinois to bring a claim | Where each person works; ask your attorney about mixed locations |
| Contractor paid by invoice | The Act has its own three-part test; the IRS uses a different one | Test both |
| Remote or traveling staff | The paydays notice must also be emailed or posted on a website or intranet they use | Where staff actually see it |
For the tax side of hiring from abroad, read hiring US employees from abroad. Illinois registrations are in our Illinois payroll guide; the US employer compliance checklist lists other first-hire steps.
Where to go next
The rules and checklist page has the numbers, 2025 changes and the Stub-Stamp-Settle Routine. Related: the federal Fair Labor Standards Act, the Cook County Minimum Wage Ordinance and the Illinois Human Rights Act.
Official sources
- Illinois General Assembly: Wage Payment and Collection Act (820 ILCS 115)
- Illinois Department of Labor: Wage Payment and Collection Act
- Illinois Department of Labor: Wage Payment and Collection Act FAQ
- Illinois General Assembly: Public Act 104-135
This page summarizes public guidance in plain language. If anything here differs from the official source, the official source controls.