Posted by HLL Admin

The Fair Labor Standards Act (FLSA) applies to most Illinois employers. For FLSA employers, there are very specific records which must be carefully maintained for each nonexempt worker. The FLSA does not require that these compensation records be kept in a particular form. Employers have flexibility to utilize whichever format works best for their business operation. This may include electronic records, paper or a hybrid system. When developing an FLSA compliant documentation system, employers should ensure that the regular work and pay records include the following information for each employee:

1. The employee’s full name and Social Security number;
2. The employee’s current address;
3. The employee’s date of birth date (if 18 or younger);
4. The employee’s sex;
5. The employee’s occupation or specific job title;
6. The employee’s workweek (the time and day of the week the workweek begins);
7. The hours worked each day of each workweek;
8. The employee’s basis for wages (hourly wage or salary);
9. The employee’s regular hourly rate;
10.  The employee’s total daily or weekly straight-time (i.e. regular) earnings;
11.  The total overtime (1.5 of the employee’s regular rate) earnings for the workweek;
12. Any additions or deductions from wages such as taxes, retirement plan contributions, insurance deductions, etc.;
13. The employee’s total wages for the pay period; and
14. The date of payment to the employee as well as the pay period covered by the payment.

Covered FLSA employers must not only create these detailed pay and compensation records but they must also keep payroll records for at least three years. See 29 C.F.R. §§ 516.1 to 516.34. In addition to the FLSA, Illinois employers must also meet state pay record requirements. Under Illinois law, employers must keep certain basic information for all employees for a minimum of three years. (See 820 ILCS 105/8 and 140/5; Ill. Admin. Code tit. 56, §§ 210.700 and 300.630). This basic information includes:

1. The employee’s name
2. The employee’s address
3. The employee’s birth date (if 18 or younger)
4. The employee’s Social Security number
5. The employee’s sex
6. The employee’s occupation/job title
7. The hours worked each day and each workweek by the employee;
8. The employer’s workweek description (time of day and day of the week the workweek begins)
9. The employee’s rate of pay and basis for wages
10. The amount paid to the employee during each pay period
11. The amount of any additions and deductions to the employee’s pay for each pay period and an explanation
12. A description of the type of compensation (salary, hourly, commission), straight time and overtime pay, and total wages per pay period
13. The dates covered by each pay period.

While most of the records outlined above are coextensive with FLSA requirements, there are additional pay documentation requirements for Illinois employers. Some notable requirements include the following:

1. Pay Stubs: While the FLSA does not require the issuance of a paystub, Illinois employers must give each employee an itemized statement of deductions each pay period under Illinois law. (See Ill. Admin. Code tit. 56, § 300.630(c)). Illinois employers must provide employees with a written documentation outlining each pay period. This documentation must include: (a) the total number of hours worked; (b) the rate of pay earned per hour; (c) any overtime hours earned and the total of any overtime pay; (d) the gross wages earned by the employee for the pay period; (e) an itemized list of all deductions from the pay earned including taxes, retirement, etc.; and (f) the year to date deductions and wages.(See Ill. Admin. Code tit. 56; § 300.600(a)).
2. Vacation Time: For Illinois employers which offer paid vacation, records must be kept stating the number of vacation days earned each year and when vacation days were taken and paid.
3. Changes in Pay: Illinois employers must notify employees in writing of the rate of pay at the time of hiring. In addition, employers must give employees written notice of a change in pay prior to the change (unless impossible to do so).
4. Minor Employees: Employers with employees under the age of 16 must keep at the workplace: (1) a record of the names, ages, and residences of all employees between the ages of 14 and 16; and (2) the employment certificates for all employees under the age of 16. (See 820 ILCS 205/6 and 205/13; Ill. Admin. Code tit. 56, § 250.315).
5. Tipped Employees: Employers also must keep supplemental records for tipped employees including: (i) a symbol, letter, or number to identify employees whose wages include gratuities; (ii) the employee reports of their gratuities each workday (signed by the employee and with the employee’s Social Security number); (iii) the amount each employee’s wages have been increased by gratuities (cannot be more than 40% of the applicable minimum wage); (iv) the total hours worked each workday in any occupation without gratuities and the total daily or weekly straight time earnings for those hours; and (v) the total hours worked each workday in an occupation with gratuities and the total daily or weekly straight time earnings for those hours.(See Ill. Admin. Code tit. 56, § 210.720.)

Please note that this article is a general summary and does not attempt to cover your specific situation or detail the obligations you have under state or federal law. Natalie Higgins is a labor and employment lawyer based in St. Louis, Missouri. She represents employers in all facets of litigation as well as providing consulting and training services to employers who want to proactively manage their employee litigation risks. Questions about your business to improve its discipline policy? Contact Natalie at natalie@hugheslawyersllc.com.