(650) 332-8623Illinois Overtime Law: Your Guide to Rates, Statutes, Calculations, and More (2025)
This guide has everything you need to know about Illinois overtime laws for 2025, including rates, thresholds, statutes, and much more.
1.5x
Illinois' Primary Overtime Pay Rate
Employees in Illinois receive overtime pay at 1.5 times their regular rate of pay for hours worked beyond 40 in a workweek.
40 hours / week
Threshold to Receive Overtime in Illinois
Illinois follows the federal 40-hour workweek standard for overtime eligibility. Employees qualify for overtime pay at 1.5 times their regular rate once they exceed 40 hours in a single workweek.
Unlike some states, Illinois does not have a daily overtime threshold, meaning employees are not automatically entitled to overtime for working more than a set number of hours in a single day.
Overtime is calculated based on total hours worked in a defined workweek, which is determined by the employer.
No extra pay
Holiday and Sunday Overtime Rules in Illinois
Illinois does not require employers to pay extra for working on holidays or Sundays.
Employees only receive overtime if working on a holiday or Sunday causes their total weekly hours to exceed 40. In that case, any hours beyond 40 in the workweek must be paid at 1.5 times the regular rate of pay.
However, employers may choose to offer extra pay as part of their company policy or union agreements, and if they do, they must honor it.
820 ILCS 105/4a
The Main Overtime Statute(s) in Illinois
Illinois’ overtime laws are primarily governed by Section 4a of the Illinois Minimum Wage Law (820 ILCS 105/4a). This statute defines overtime pay requirements, including the 1.5x pay rate for hours worked over 40 in a workweek, and outlines employer obligations.
Other related regulations impact how overtime is administered in Illinois:
This provides additional guidelines on how overtime is calculated and enforced under state law. It clarifies that a workweek is a fixed, regularly recurring period of 168 hours—seven consecutive 24-hour periods—which can begin on any day and at any hour.
2. Fair Labor Standards Act (FLSA)
A federal law that also sets overtime rules, which Illinois employers must follow.
Employers in Illinois must comply with both federal and state regulations, adhering to the provision that offers greater employee benefits.
For instance, while Illinois follows the federal guideline of overtime after 40 hours in a workweek, it also has specific provisions, such as the One Day Rest in Seven Act, which mandates at least one 24-hour rest period in every calendar week for employees.
IDOL
The Illinois Department of Labor Enforces Overtime Laws in Illinois
The Illinois Department of Labor (IDOL) is responsible for enforcing overtime laws in the state.
IDOL ensures that employees receive proper overtime pay, investigates wage complaints, and enforces Illinois Minimum Wage Law. The department also provides guidance to employers on wage and hour compliance and oversees related labor regulations.
Employees who believe they have not been paid overtime correctly can file a complaint with IDOL for investigation and enforcement.
How to Calculate Overtime Pay in IL
Calculating overtime pay in Illinois depends on an employee’s regular rate of pay, which includes hourly wages, salaries, commissions, and non-discretionary bonuses.
Illinois follows the 1.5x overtime pay rule for hours worked beyond 40 in a workweek.
Step-by-Step Overtime Calculation:
- Determine the regular rate of pay, including hourly wages, commissions, and bonuses.
- Multiply the regular rate by 1.5 to get the overtime rate.
- Multiply the overtime rate by the number of overtime hours worked to find the overtime earnings.
Example 1: Overtime for Hourly Workers
An employee earns $20 per hour and works 50 hours in a week.
- Regular weekly pay: $20 * 40 = $800
- Overtime hours: 50 – 40 = 10
- Overtime pay rate: $20 * 1.5 = $30 per hour
- Overtime earnings: $30 * 10 = $300
- Total weekly pay: $800 (regular) + $300 (overtime) = $1,100
Example 2: Overtime for Salaried Employees
Illinois law does not automatically exempt salaried employees from overtime. Salaried workers who do not meet exemption criteria must be paid overtime based on their hourly equivalent wage.
An employee earns a weekly salary of $1,000 and works 45 hours in a week:
- Hourly rate: $1,000 / 40 = $25 per hour
- Overtime pay rate: $25 * 1.5 = $37.50 per hour
- Overtime earnings: $37.50 * 5 = $187.50
- Total weekly pay: $1,000 (regular) + $187.50 (overtime) = $1,187.50
Example 3: Overtime Pay for Tipped Employees
Tipped employees are entitled to overtime pay, but their overtime rate is based on the full minimum wage, not just their cash wage.
Illinois allows employers to take a tip credit, but the credit cannot be increased for overtime hours.
If the Illinois minimum wage is $15 per hour and the tip credit is $6, a tipped worker’s overtime rate is calculated as follows:
- Regular minimum wage: $15 per hour
- Overtime pay rate: $15 * 1.5 = $22.50 per hour
- Tip credit: $6 per hour
- Overtime pay owed by employer: $22.50 – $6 = $16.50 per overtime hour
A tipped employee working 50 hours a week would earn:
- Regular pay: $15 * 40 = $600
- Overtime pay: $16.50 * 10 = $165
- Total weekly pay: $600 (regular) + $165 (overtime) = $765
Example 4: Overtime Pay for Commissioned Employees
Commissioned workers must have their commissions included in their regular hourly rate before calculating overtime.
Step 1: Calculate the Normal Hourly Rate
Formula:
Normal Rate = ((Hourly Wage * Total Hours Worked) + Commission) / Total Hours Worked
If an employee works 45 hours at $10 per hour and earns a $40 commission, their normal hourly rate is:
Normal Rate = ((10 * 45) + 40) / 45
Normal Rate = (450 + 40) / 45
Normal Rate = 490 / 45
Normal Rate = 10.89
So, the normal hourly rate is $10.89.
Step 2: Calculate the Overtime Pay Rate
Formula:
Overtime Rate = Normal Hourly Rate * 1.5
Overtime Rate = 10.89 * 1.5
Overtime Rate = 16.34 (rounded from 16.335)
So, the overtime pay rate is $16.34 per hour.
Step 3: Calculate Overtime Earnings
- Overtime hours worked: 5
- Overtime pay calculation:
Overtime Pay = Overtime Rate * Overtime Hours
Overtime Pay = 16.34 * 5
Overtime Pay = 81.70
So, overtime earnings total $81.70.
Step 4: Calculate Total Weekly Pay
We now sum regular pay (for the first 40 hours) and overtime pay (for the 5 extra hours).
- Regular pay (for 40 hours):
Regular Pay = Normal Hourly Rate * 40
Regular Pay = 10.89 * 40
Regular Pay = 435.60
- Overtime pay: $81.70
- Total weekly pay calculation:
Total Weekly Pay = Regular Pay + Overtime Pay
Total Weekly Pay = 435.60 + 81.70
Total Weekly Pay = 517.30
Who's Eligible For Overtime Pay in Illinois?
Employees in Illinois who are paid by the hour are generally eligible for overtime pay. Under Illinois Minimum Wage Law, workers must be paid 1.5 times their regular hourly rate for any hours worked beyond 40 in a single workweek.
Since Illinois does not have a daily overtime threshold, an hourly worker could work more than 8 hours in a day without receiving overtime—unless their total hours for the week exceed 40.
Employers define the workweek, and employees must check with their employer to confirm their official work schedule.
Being paid a salary does not automatically mean an employee is exempt from overtime pay in Illinois.
Non-exempt salaried employees—those who do not meet the legal criteria for exemption—are still entitled to overtime pay if they work more than 40 hours in a workweek.
To determine whether a salaried employee qualifies for overtime, both of the following must be considered:
- How they are paid – A salaried employee must receive a fixed amount on a weekly or less frequent basis, regardless of work quality or quantity.
- Their job duties – If a salaried worker’s primary duties do not fall under an overtime exemption category, they must be paid 1.5 times their regular rate for overtime hours.
This means that some salaried employees qualify for overtime, while others—such as executive, administrative, or professional employees who meet exemption criteria—do not.
Employees primarily engaged in selling or servicing cars, trucks, or farm equipment at dealerships are exempt from overtime pay in Illinois.
This exemption applies to salesmen, mechanics, and parts workers whose duties revolve around vehicle sales or service. Since these roles often involve commission-based pay structures, they fall outside standard overtime protections.
Employees engaged in agricultural labor are not entitled to overtime pay under Illinois law. This exemption covers farmworkers involved in planting, cultivating, harvesting, or tending livestock.
The reasoning behind this exemption is that agricultural work is seasonal and traditionally operates outside standard wage and hour laws.
Under the Fair Labor Standards Act (FLSA), employees in executive, administrative, or professional (EAP) roles are exempt from overtime pay if they meet the following criteria:
1. Salary Basis – Must receive a fixed salary that does not fluctuate based on hours worked or performance.
2. Salary Level – Must earn at least $1,128 per week ($58,656 annually) as of January 1, 2025.
3. Duties Test – Primary job duties must meet FLSA criteria:
- Executive – Manages a department, directs at least two full-time employees, and has authority over hiring or firing.
- Administrative – Performs non-manual work related to business operations and makes independent decisions on significant matters.
- Professional – Requires advanced knowledge in a specialized field (e.g., law, medicine, engineering) or creative work.
Job titles alone do not determine exemption—actual job duties and salary must align with FLSA guidelines. See the U.S. Department of Labor for details.
Employees working in radio or television broadcasting in cities with populations under 100,000 are exempt from overtime pay.
This exemption applies due to the small-market nature of such stations, where flexible scheduling is common.
Under the Fair Labor Standards Act (FLSA), the Section 7(i) exemption allows certain commissioned employees in retail or service establishments to be exempt from overtime pay if they meet specific criteria:
- Employment in a Retail or Service Establishment: The employee must work for an establishment where at least 75% of its annual sales are not for resale and are recognized as retail sales or services in the industry.
- Earnings from Commissions: More than half of the employee’s total earnings during a representative period (not less than one month) must come from commissions on goods or services.
- Regular Rate of Pay: The employee’s regular rate of pay must exceed one and one-half times the applicable minimum wage for every hour worked in a workweek where overtime hours are worked.
It’s important to note that in 2020, the U.S. Department of Labor withdrew previous lists categorizing certain industries as lacking a retail concept. This change means that establishments previously considered non-retail may now qualify for the Section 7(i) exemption, provided they meet the necessary criteria.
Some employees swap work hours with coworkers under a workplace exchange agreement. These workers are not entitled to overtime for hours worked beyond 40 in a week, as long as the arrangement complies with state labor laws.
Under the Fair Labor Standards Act (FLSA), certain employees of educational institutions and residential childcare facilities may be exempt from overtime pay requirements, depending on their specific roles and duties.
1. Teachers
Employees whose primary duty is teaching, tutoring, instructing, or lecturing to impart knowledge, and who are employed by educational establishments such as elementary or secondary schools, or institutions of higher education, are exempt from both minimum wage and overtime pay provisions.
This exemption applies regardless of the subject taught or the age of the students.
2. Houseparents in Residential Facilities
The FLSA provides a specific overtime exemption under Section 13(b)(24) for employees employed with their spouse by nonprofit educational institutions to serve as parents of children who are orphans or have one deceased parent, or who reside in the institution’s facilities.
Both spouses must reside in the facility and receive, without cost, board and lodging from the institution.
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IL vs. Federal Overtime Laws Compared
40 Hours / WeekOVERTIME THRESHOLD IN ILLINOIS
Illinois does not have a state-specific daily overtime threshold. Instead, employees are entitled to overtime pay only after exceeding 40 hours in a single workweek. This aligns with the federal Fair Labor Standards Act (FLSA), meaning Illinois workers must track total weekly hours rather than daily hours to determine eligibility for overtime.
Employers in Illinois define their own workweek, which must be a consistent, fixed period of seven consecutive days. Employees should confirm their employer’s official workweek definition, as it affects overtime calculations.
40 Hours / WeekFEDERAL OVERTIME THRESHOLD
The Fair Labor Standards Act (FLSA) sets the federal standard for overtime pay, requiring that non-exempt employees receive overtime pay after working more than 40 hours in a workweek. A workweek under federal law is defined as a fixed, regularly recurring period of 168 hours (seven consecutive 24-hour days).
The FLSA does not require daily overtime pay, meaning employees working long shifts within a single day are not automatically entitled to overtime—only if their total weekly hours exceed 40.
1.5xOVERTIME RATE IN ILLINOIS
Illinois follows the federal overtime rate standard, requiring employers to pay 1.5 times an employee’s regular rate of pay for any hours worked beyond 40 in a workweek. There are no state-specific enhancements to the overtime rate—Illinois law mirrors the federal Fair Labor Standards Act (FLSA).
1.5xFEDERAL OVERTIME RATE
Under the Fair Labor Standards Act (FLSA), the federal overtime pay rate is 1.5 times an employee’s regular hourly rate for any hours worked beyond 40 in a workweek. This applies to all non-exempt employees, regardless of whether they are paid hourly or on a non-exempt salary basis.
$58,656 / yearIllinois Overtime Threshold for Salaried Employees
Illinois follows the Fair Labor Standards Act (FLSA) and the Illinois Minimum Wage Law (IMWL) to determine overtime eligibility.
Starting January 1, 2025, the new federal minimum salary threshold for overtime exemption is $1,128 per week ($58,656 per year).
To be exempt from overtime, a salaried employee must:
- Earn at least $1,128 per week ($58,656 per year)
- Perform executive, administrative, or professional (EAP) duties as defined by federal law
If a salaried employee earns below $1,128 per week or does not meet the job duties test, they are classified as non-exempt and must receive 1.5x their regular rate for hours worked beyond 40 per workweek.
$58,656 / yearFederal Overtime Threshold for Salaried Employees
Starting January 1, 2025, the federal wage threshold exempting roles from overtime pay is set at $1,128 per week, equivalent to $58,656 per year.
The FLSA also stipulates special thresholds for salaried employees in certain territories as well, with much lower thresholds (between $380 and $455 per week) for Puerto Rico, Guam, the U.S. Virgin Islands, the Northern Mariana Islands, and American Samoa.
ILRoles Exempt from Overtime
Illinois follows federal overtime exemption rules under the Fair Labor Standards Act (FLSA). Employees must meet specific job duties and earn at least $684 per week ($35,568 per year) to qualify as exempt (820 ILCS 105/4a).
Overtime-Exempt Roles in Illinois:
- Executive, Administrative, and Professional (EAP) Employees – Must be salaried and perform high-level management, administrative, or specialized professional duties.
- Outside Sales Employees – Must work primarily outside the office selling products/services.
- Commissioned Retail/Service Employees – More than 50% of earnings must come from commissions, with a regular pay rate above 1.5x minimum wage.
- Salesmen and Mechanics at Dealerships – Applies to workers selling or servicing vehicles or farm equipment.
- Agricultural Workers – Includes farmworkers in planting, harvesting, and livestock care.
- Certain Radio/TV Employees – Exempts employees at stations in cities under 100,000 residents.
- Workplace Exchange Agreements – Employees who swap hours under a valid agreement.
Educational/Childcare Institution Employees – Covers specific schools and childcare facilities.
FederalRoles Exempt from Overtime
Federal overtime law exempts certain roles from overtime pay:
- Executive, administrative, and professional employees earning more than the threshold
- Computer-related employees
- Outside sales employees
- Highly compensated workers earning more than $151,164 per year, of which at least $1,128 must be paid on a salary or fee basis per week
Misconceptions About IL Overtime Laws
Some employees believe they cannot be forced to work overtime unless they agree to it.
Illinois employers can require employees to work overtime, as long as they follow wage laws and do not violate the One Day Rest in Seven Act (ODRISA). Employees must be paid 1.5x their regular pay for overtime hours, but refusing overtime could lead to disciplinary action unless protected by a contract or law.
Some employers offer compensatory (comp) time off instead of overtime pay.
Comp time in place of overtime pay is not legal in the private sector. Employers must pay overtime wages for extra hours worked. However, government employees may receive comp time under certain conditions.
Many believe that only hourly workers can receive overtime pay.
Salaried employees are not automatically exempt from overtime. If a salaried worker earns less than $684 per week or does not perform executive, administrative, or professional duties, they are entitled to 1.5x overtime pay just like hourly employees.
Some employees think they are entitled to extra pay just for working on holidays or weekends.
Illinois does not require overtime pay for holidays or weekends unless the extra hours push the employee beyond 40 hours in a workweek. Employers may choose to offer extra holiday pay, but it is not a legal requirement.
Some employees assume overtime pay is calculated only from their base hourly wage.
Under the Fair Labor Standards Act (FLSA), overtime pay must include all nondiscretionary bonuses, commissions, and incentive pay, not just base wages. The regular rate of pay—used to calculate overtime—is determined by dividing total compensation (excluding statutory exclusions) by total hours worked.
For example, if an employee works 50 hours at $15/hour and earns a $100 nondiscretionary bonus, their regular rate is $17/hour ($850 ÷ 50).
Overtime is then paid at 1.5 times this rate ($25.50/hour) for overtime hours. Employers must properly factor in all eligible earnings to ensure FLSA compliance.
Some employers misclassify workers as independent contractors to avoid paying overtime.
Misclassifying employees as independent contractors to avoid paying overtime is unlawful. In Illinois, such misclassification denies workers protections like minimum wage and overtime pay, unemployment benefits, and workers’ compensation.
Therefore, merely labeling a worker as an independent contractor does not exempt employers from wage protections; the true nature of the work relationship determines eligibility for overtime pay.
Some employers and employees believe that agreeing to a fixed salary means overtime doesn’t apply.
Illinois law does not allow employees to waive their right to overtime pay. If an employee is non-exempt, they must still receive 1.5x pay for any hours worked over 40 in a workweek, regardless of any prior agreement.
Some employees think they don’t qualify for overtime if they work from home or offsite.
Overtime applies to all work performed, regardless of location. Whether an employee is working remotely, on a job site, or traveling for work, if they exceed 40 hours in a workweek, they are entitled to 1.5x overtime pay.
Some employers believe that if an employee works 50 hours one week and 30 hours the next, they do not need to pay overtime.
Illinois law requires overtime to be calculated weekly. An employer cannot average two weeks together to avoid paying overtime. If an employee works more than 40 hours in a single workweek, they must be paid 1.5x overtime for those extra hours.
Some employers believe that if they pay an employee off the books in cash, they do not have to pay overtime.
All employees—regardless of how they are paid—are covered under Illinois overtime laws. Paying in cash does not exempt an employer from wage requirements. Workers who are denied overtime pay can file a complaint with the Illinois Department of Labor (IDOL).
Penalties for Overtime Noncompliance in IL
5% Monthly DamagesFailure to pay owed wages on time
Under the IMWL (Illinois Minimum Wage Law), employers who underpay employees are liable for damages amounting to 5% of the underpaid wages for each month the underpayment remains unresolved. These damages continue to accrue monthly until the full payment is made.
20% Penalty Willful, repeated, or reckless wage underpayment
If an employer’s conduct is proven to be willful, repeated, or in reckless disregard of the IMWL, they may be subjected to a penalty of up to 20% of the total underpayment. This penalty is payable to the Illinois Department of Labor.
$1,500 Additional Penalty
Employers may incur an additional penalty of $1,500 for certain violations under the IMWL. This penalty is also payable to the Department’s Wage Theft Enforcement Fund.
1% Daily Penalty Failure to comply with a payment demand
If an employer does not timely comply with a demand or final order issued by the Illinois Department of Labor, they are liable for a penalty equal to 1% of the underpaid wages for each day the payment is delayed. This daily penalty continues to accrue until the full amount is paid to the employee.
Administrative FeesNon-compliance with wage payment demands or orders.
Employers who fail to pay wages or final compensation as demanded or ordered must pay an administrative fee to the Illinois Department of Labor. The fee structure is as follows:
- $250 for amounts up to $3,000
- $500 for amounts over $3,000 but less than $10,000
- $1,000 for amounts of $10,000 or more
These fees are non-waivable and are assessed in addition to any penalties and unpaid wages.
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Navigating Overtime Requirements in IL
Know What to Do as an Employer
- Understand Illinois Overtime Laws – Stay informed about the Illinois Minimum Wage Law (IMWL) and Fair Labor Standards Act (FLSA) to determine which employees are eligible or exempt from overtime pay. Keep track of legal updates, as wage laws can change.
- Accurately Track Employee Work Hours – Use reliable timekeeping systems to record all regular and overtime hours worked. Ensure break periods and any off-the-clock work are properly documented to prevent wage disputes.
- Train Managers and HR Staff on Overtime Rules – Educate HR personnel and supervisors about how overtime pay is calculated, the proper way to classify employees, and common compliance mistakes to avoid.
- Audit Payroll and Overtime Calculations – Regularly review payroll records to ensure overtime is correctly calculated at 1.5x the regular rate, including commissions, bonuses, and other earnings.
- Maintain Accurate Payroll Records – Keep detailed records of employees’ work hours, overtime payments, and pay structure for at least three years, as required by Illinois law. This helps in case of audits or employee disputes.
- Clearly Communicate Overtime Policies – Have a written overtime policy that explains how overtime is approved, tracked, and paid. Ensure all employees understand their rights and how to report overtime issues.
- Avoid Misclassification of Employees – Ensure employees are correctly classified as exempt or non-exempt. Misclassifying a worker as exempt when they should receive overtime can result in fines and back pay penalties.
- Seek Legal Guidance When Needed – Consult with employment law professionals to navigate complex overtime cases, wage disputes, and compliance requirements under Illinois law.
Know Your Rights as a Worker
- Determine Your Overtime Eligibility – Know whether you are classified as exempt or non-exempt under Illinois law. Non-exempt employees must receive 1.5x their regular pay for hours worked beyond 40 in a workweek.
- Keep Your Own Work Hour Records – Track your regular and overtime hours, including any time worked off the clock. Your own records can help resolve discrepancies in payroll.
- Know How Your Overtime Pay Is Calculated – Overtime is based on your regular rate, which includes hourly wages, commissions, and non-discretionary bonuses. If you’re a tipped worker, your overtime is based on the full minimum wage, not just your cash wage.
- Review Your Paychecks for Accuracy – Check your pay stubs to ensure your overtime hours and rates are correctly recorded. If there are errors, address them as soon as possible with your employer.
- Understand Your Employer’s Overtime Policies – Employers may have policies on how overtime is approved, but they cannot deny legally required overtime pay if you worked the extra hours.
- Communicate Pay Issues with Your Employer First – If you believe you were underpaid for overtime, report the issue to HR or payroll before taking legal action. Many issues can be resolved internally.
- Know Where to Report Wage Violations – If your employer refuses to pay overtime or retaliates against you for raising concerns, you can file a wage claim with the Illinois Department of Labor (IDOL) (IDOL Wage Claim) or seek legal assistance.
Common Overtime Pay Challenges for Employers in IL
1. Misclassification of Employees
Employers often misclassify workers as exempt when they should be non-exempt, or label employees as independent contractors to avoid overtime pay. Illinois follows federal exemption rules, meaning salaried employees earning under $684 per week or not meeting specific job duty requirements must receive overtime pay.
2. Inaccurate Recordkeeping
Failing to track employee work hours correctly can lead to wage disputes. Illinois law requires employers to maintain accurate records of hours worked, overtime pay, and employee classifications. Poor recordkeeping makes it difficult to prove compliance during audits or disputes.
3. Miscalculating Overtime Pay
Employers sometimes fail to include commissions, bonuses, and non-hourly earnings when calculating overtime pay. Illinois law requires that all forms of compensation be factored into the regular rate of pay before determining overtime wages.
4. Overtime Pay for Tipped Employees
Some employers incorrectly calculate overtime pay for tipped workers by applying the lower cash wage instead of the full state minimum wage. This can lead to underpayment and penalties, as Illinois law mandates overtime be based on the full minimum wage, not the reduced tipped wage.
5. Failure to Properly Track Off-the-Clock Work
Employers may unintentionally allow or require employees to work off the clock, including responding to emails, attending meetings before shifts, or finishing tasks after logging out. These extra hours must be counted toward overtime pay.
6. Ignoring the “One Day Rest in Seven Act” (ODRISA)
Illinois law requires employers to provide at least one 24-hour rest period in every seven-day workweek, unless a valid exemption applies. Employers who schedule workers for seven consecutive days without the required rest could face penalties in addition to overtime liabilities.
7. Delays or Errors in Overtime Payments
Employers must pay overtime wages on time according to Illinois wage payment laws. Delays or miscalculations could result in 5% monthly penalties on unpaid wages, lawsuits, or state enforcement actions.
General Best Practices for IL Overtime Laws
1. Properly Classify Employees
Employers must correctly determine whether workers are non-exempt or exempt under Illinois and federal overtime laws. Misclassifying employees as exempt or as independent contractors when they should receive overtime can lead to penalties, back pay liabilities, and legal action.
2. Use Reliable Timekeeping Systems
Implement accurate time-tracking tools to log all hours worked, overtime, and break periods. Illinois requires detailed payroll records to be kept for at least three years, so maintaining precise work-hour documentation is critical for compliance.
3. Calculate Overtime Pay Correctly
Overtime must be based on an employee’s total earnings, not just their hourly wage. Employers should include bonuses, commissions, and other incentive pay when determining the regular rate of pay before calculating overtime at 1.5x the adjusted rate.
4. Ensure Overtime Pay for Tipped Employees Is Based on the Full Minimum Wage
Tipped employees must have their overtime pay calculated using the full Illinois minimum wage, not just the reduced cash wage. Employers cannot claim a higher tip credit for overtime hours than they do for regular hours.
5. Follow Illinois’ One Day Rest in Seven Act (ODRISA)
Illinois law requires that employees receive at least one 24-hour rest period in every seven-day workweek, unless they fall under an exemption. Employers should schedule work shifts accordingly to avoid compliance issues.
6. Pay Overtime Wages on Time
Illinois law mandates that employees receive their overtime pay in a timely manner. Late payments can result in 5% monthly penalties on unpaid wages, increasing financial liability for employers.
7. Train HR and Payroll Teams on Illinois Overtime Laws
Employers should regularly train HR personnel, payroll staff, and managers to ensure accurate payroll processing, employee classification, and compliance with wage laws. This helps prevent costly errors and legal disputes.
8. Have a Clear Overtime Policy
Establish a written overtime policy that defines how overtime is approved, tracked, and compensated. Communicate this policy clearly to employees and managers to avoid misunderstandings or disputes.
9. Stay Updated on Wage Law Changes
Overtime laws can change at the state and federal level. Employers should monitor Illinois Department of Labor (IDOL) updates and consult with employment law professionals to ensure compliance with new regulations.
Final Thoughts
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Illinois does not have a daily overtime law, meaning employees do not automatically qualify for overtime after working more than 8 hours in a day. Instead, overtime pay is required for non-exempt employees who work more than 40 hours in a single workweek.
Overtime must be paid at 1.5 times the employee’s regular hourly rate for all hours beyond 40 in a week. Some employers may voluntarily offer daily overtime pay, but it is not required by Illinois overtime law.
Illinois does not have a law requiring employers to give advance notice before assigning mandatory overtime. Employers generally have the right to schedule employees for overtime hours as needed.
However, employees covered by union contracts or company policies may have different notice requirements. The only restriction is the One Day Rest in Seven Act (ODRISA), which requires at least one 24-hour rest period per week unless an exception applies.
Employees classified as exempt under Illinois overtime law are not entitled to overtime pay. Common exemptions include:
- Executive, administrative, and professional employees earning at least $684 per week
- Outside sales employees
- Commissioned retail or service employees (earning more than 1.5 times minimum wage, with more than 50% of earnings from commissions)
- Certain agricultural workers
- Car salespeople and mechanics at dealerships
- Select radio/TV employees in cities under 100,000 residents
Employers should carefully classify workers, as misclassification can lead to penalties.
In most cases, no. Illinois law allows employers to require overtime unless a contract, union agreement, or specific labor law states otherwise. However, employees can legally refuse overtime if it violates the One Day Rest in Seven Act (ODRISA), which mandates at least one 24-hour rest period per workweek.
In addition, some health and safety laws may limit excessive overtime for certain industries, such as healthcare and transportation. Employees who refuse overtime without legal protection may face disciplinary action, including termination.
Salaried employees must receive overtime unless they meet exemption criteria. To calculate overtime for a non-exempt salaried worker, determine their regular hourly rate:
- Weekly salary ÷ 40 hours = regular hourly rate
- Regular hourly rate × 1.5 = overtime rate
- Overtime rate × overtime hours = overtime pay
For example, a salaried employee earning $1,000 per week working 45 hours would have a regular hourly rate of $25 and an overtime rate of $37.50. For 5 overtime hours, the additional pay would be $187.50.
Yes. Tipped employees must receive overtime pay, but their overtime rate is based on the full Illinois minimum wage—not just their cash wage.
Employers can take a tip credit, but for overtime, the base wage is minimum wage × 1.5, with the tip credit subtracted.
For example, if the minimum wage is $14 per hour, overtime pay is calculated as:
- $14 × 1.5 = $21 (overtime wage before tip credit)
- $21 – $6 tip credit = $15 overtime rate per hour
Employers who fail to pay required overtime may face penalties under Illinois overtime law, including:
- 5% monthly interest on unpaid wages
- 20% additional penalties for willful violations
- $1,500 fines for specific violations
- 1% daily penalty for delayed payments
Employees can file a wage claim with the Illinois Department of Labor (IDOL) or pursue legal action for back pay and damages (IDOL Wage Claim).
No. Illinois does not require double time pay, even for excessive hours worked in a day or week. However, certain union contracts or company policies may offer double time for holidays, weekends, or long shifts.
Employers are only required to pay 1.5x the regular rate for overtime hours beyond 40 per week under Illinois law.
