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| Public Act 099-0903 | ||||
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AN ACT concerning civil law.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Wage Assignment Act is amended by | ||||
changing Sections 2, 2.1, 2.2, 4.1, and 4.2 as follows:
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(740 ILCS 170/2) (from Ch. 48, par. 39.2)
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Sec. 2.
Demand on an employer for the wages of wage-earner | ||||
by virtue of a
wage assignment may not be served on the | ||||
employer unless:
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(1) There has been a default of more than 40 days in | ||||
payment of the
indebtedness secured by the assignment and | ||||
the default has continued to the
date of the demand;
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(2) The demand contains a correct statement as to the | ||||
amount the
wage-earner is in default and the original or a | ||||
photostatic copy of the
assignment is exhibited to the | ||||
employer; and
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(3) Not less than 20 days before serving the demand, | ||||
notice required under Section 2.2 a notice of
intention to | ||||
make the demand has been served upon the employee, and an
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advice copy sent to the employer, by 2 methods: (i) first | ||||
class mail; and (ii) registered or certified mail.
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Service of any demand without complying with this Section | ||||
has no legal
effect. Proof of certified mail is prima facie | ||||
evidence of service.
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A demand under this Section applies only to wages due at | ||
the time of
service of the demand and upon subsequent wages | ||
until the total amount due
under the assignment is paid, or, if | ||
the wage assignment is revocable under federal law, until the | ||
employee revokes it or until the expiration of the employer's
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payroll period ending immediately prior to 84 days after | ||
service of
such demand, whichever first occurs.
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(Source: P.A. 88-395.)
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(740 ILCS 170/2.1) (from Ch. 48, par. 39.2a)
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Sec. 2.1. A demand shall be in the following form:
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"Demand is hereby made upon an assignment of salary, wages, | ||
commissions
or other compensation for services, executed by | ||
.... and delivered to ....
on (insert date), to secure a debt
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contracted on (insert date).
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The total amount of the debt is $..... Payments in the | ||
amount of $....
have been made. The duration of the contract is | ||
.... months. There is now
due and owing without acceleration | ||
the sum of $...., the last payment
having been made on (insert | ||
date).
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The employee herein named has been in default in his | ||
payments in the
amount of $...., of which $.... has been due | ||
and owing for more than 40
days.
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Unless you have received a written notice from the employee | ||
herein named revoking the wage assignment within the past 20 | ||
days, or do receive within 5
days after the service hereof, a | ||
notice of defense from the employee herein
named, you are | ||
required by law to make payment in accordance with such
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assignment. ...., first being duly sworn, deposes and says that | ||
the facts
stated in the demand above are true and correct; and | ||
further deposes and
says that he (or his principal, if he is an | ||
agent for the assignee) has not received notice from the debtor | ||
that he or she is revoking the wage assignment no
notice of any | ||
defenses of the debtor.
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Payments must be made until the total amount due under the | ||
assignment is paid or until the employee revokes the wage | ||
assignment. | ||
...........................
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Subscribed and sworn to before me on (insert date).
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...........................
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Notary Public".
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(Source: P.A. 91-357, eff. 7-29-99.)
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(740 ILCS 170/2.2) (from Ch. 48, par. 39.2b)
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Sec. 2.2. Forms; notice of intent to assign wages; | ||
revocation. | ||
(a) The notice to an employee required by Section 2 shall | ||
be in the
following form:
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"NOTICE OF INTENT TO ASSIGN WAGES
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This notice is required by the Illinois Wage Assignment | ||
Act. The notice
has been sent to tell you that a creditor (name | ||
and address listed below)
plans to have your wages assigned. A | ||
wage assignment is a document you signed at the time you signed | ||
the contract for your debt. It authorizes your creditor to | ||
receive a portion of your wages directly from your employer, in | ||
order to pay your debt. This notice contains important | ||
information about the debt and what your options are.
You | ||
should read the entire notice carefully.
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WHY THE CREDITOR WANTS TO ASSIGN YOUR WAGES
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You signed a wage assignment on ....... (date) .......
The | ||
wage assignment was signed as security if you failed to make | ||
payment
on the contract you signed on ......... (date) | ||
..........
A copy of the wage assignment is attached. The | ||
creditor's records show
that you have not made a payment since | ||
......... (date) ....... and that
you now owe $........ on the | ||
contract. The creditor will send
a demand for wages to your | ||
employer 20 days from the date you receive this.
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WHAT YOU CAN DO TO PREVENT YOUR WAGES FROM BEING ASSIGNED
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If you have a legal defense to the wage assignment you can | ||
stop the wage
assignment by filling out the enclosed Notice of | ||
Defense Form and (1) sending
it to the creditor by registered | ||
or certified mail and (2) giving a copy to
your employer. You | ||
must do those 2 things within 20 days of receiving this
notice. | ||
You have the right to contact an attorney concerning the wage | ||
assignment.
In the event a false defense is made, you will be | ||
subject to payment of
attorneys' fees, court costs and other | ||
expenses.
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The creditor's name, and address, and phone number are:
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......................
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......................
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......................
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......................
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(Signed by)"
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(b) If the wage assignment is revocable under federal law, | ||
the notice required under subsection (a) shall also include the | ||
following: | ||
UNDERSTANDING YOUR CHOICES UNDER THE | ||
ILLINOIS WAGE ASSIGNMENT ACT | ||
There are options available to you in this process. You | ||
should consider your options and determine the one that is best | ||
for you. You have the right to contact an attorney at any point | ||
concerning the wage assignment, or to help you determine your | ||
best option. | ||
Your options include: | ||
(1) You can stop the wage assignment at any time, which | ||
will stop your wages from being deducted. It will not | ||
eliminate your debt, and interest may continue to accrue. | ||
You may contact your creditor for more information about | ||
the interest rate on your contract, and to determine how | ||
much interest might accrue if you stop the wage assignment. | ||
Your creditor will still be able to pursue other means | ||
of collecting any debt you may owe, including filing a | ||
lawsuit against you for the full amount owed under the | ||
contract and any interest that might accrue. A lawsuit | ||
might result in you owing legal fees and other costs. | ||
You can stop the wage assignment by filling out the | ||
enclosed Revocation Notice Form, or by writing a letter | ||
stating that you are revoking the wage assignment. Send the | ||
Revocation Notice Form or letter by registered or certified | ||
mail to the creditor, at the address listed above. It is | ||
highly recommended that you give a copy of the Revocation | ||
Notice Form or letter to your employer so your employer can | ||
stop any pending payments. | ||
If you choose to write a letter, it should be addressed | ||
to the creditor, and should include: | ||
(i) your name; | ||
(ii) the account number; and | ||
(iii) a statement that you are revoking the wage | ||
assignment, such as, "I am revoking the wage | ||
assignment." | ||
Even if the wage assignment has already begun, you can | ||
still stop it now or at any point in the future. | ||
(2) You can do nothing, and allow the wage assignment | ||
process to proceed. Starting in 20 days, part of your wages | ||
will be sent directly to the creditor to pay off your debt. | ||
This will reduce your take-home pay every pay period until | ||
the total amount of the debt is repaid. | ||
Up to 15% of your wages will be sent to the creditor | ||
every pay period. Once the total amount is repaid, the | ||
creditor will send a notice to you and to your employer | ||
that includes the creditor's name, your name, and the | ||
account number, stating that the wage assignment is closed | ||
and no further wages should be assigned. | ||
(3) You can contact your creditor to repay the debt, or | ||
to explore other options, including a repayment plan or | ||
refinancing, if available. You can contact your creditor at | ||
the address and phone number listed above. | ||
If you agree on another repayment option with your | ||
creditor, the creditor will send a notice to your employer | ||
stating that your wages should not be assigned. | ||
(c) If the wage assignment is revocable under federal law, | ||
the notice required under subsection (b) shall be accompanied | ||
by the following Revocation Notice Form, with the relevant | ||
information inserted by the creditor: | ||
"REVOCATION NOTICE | ||
The employee's name and address are: | ||
...................... | ||
...................... | ||
...................... | ||
...................... | ||
The creditor's name and address are: | ||
...................... | ||
...................... | ||
...................... | ||
...................... | ||
Re: (insert account number) | ||
I, (insert name), hereby revoke the wage assignment I | ||
signed on (insert date the wage assignment was signed). You no | ||
longer have my permission to use this wage assignment. | ||
...................... ...................... | ||
(Signed by) (Date)" | ||
(Source: P.A. 83-867.)
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(740 ILCS 170/4.1) (from Ch. 48, par. 39.4a)
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Sec. 4.1. Revocation of wage assignment. If the wage | ||
assignment is revocable under federal law, the employee may | ||
revoke the wage assignment at any time by submitting the | ||
Revocation Notice Form as provided in subsection (c) of Section | ||
2.2 of this Act or otherwise providing written notice of | ||
revocation to the creditor. Revocation is effective regardless | ||
of how the creditor receives it. Failure to use the sample | ||
language provided in the notice described in Section 2.2 does | ||
not affect the validity of the written notice of revocation. | ||
The employee may submit a copy of the notice to his or her | ||
employer. If the written notice of revocation is served upon | ||
the creditor prior to the creditor's service
of demand upon the | ||
employer, the demand shall not be served. Within 20 days after | ||
receiving the notice required by Section 2
or within 5 days | ||
after service of the demand, the employee may notify his
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employer, in writing, of any defense he may have to the wage | ||
assignment. A
copy of such notice shall be served upon the | ||
creditor by registered or
certified mail. If served upon the | ||
creditor prior to the creditor's service
of demand upon the | ||
employer, such demand shall not be served by the
creditor. The | ||
notice shall be by affidavit and shall be in substantially
the | ||
following form:
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"I, ...., hereby (swear) (affirm) that I have a bona fide | ||
defense to the
claim of ...., which claim is based on a debt | ||
contracted on (insert date), and for security on which debt a | ||
wage
assignment was executed.
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..............................
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Address for service of summons
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..............................
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Employee
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Subscribed and sworn to before me on (insert date).
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............................."
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Notary Public
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(Source: P.A. 91-357, eff. 7-29-99.)
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(740 ILCS 170/4.2) (from Ch. 48, par. 39.4b)
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Sec. 4.2.
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If the employee has not served a Revocation Notice Form as | ||
provided in Section 4.1 of this Act or has not otherwise served | ||
the creditor with a written notice of revocation (if the wage | ||
assignment is revocable under federal law) given notice of | ||
defense as provided in this Act
within 20 days after receiving | ||
the notice of intention to make a demand,
the creditor may | ||
proceed with his demand, and the employer shall commence
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payment to the creditor not sooner than 5 business days after | ||
service of
such demand, if no revocation notice has been | ||
received by the employer unless a notice of defense is received | ||
within that 5 day
period. If the employee cures the default | ||
stated in the demand or revokes the wage assignment, the
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creditor shall notify the employer and release the demand. No | ||
employer
shall be liable for payments made in compliance with | ||
this Section.
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If a Revocation Notice Form as set forth in Section 4.1 of | ||
this Act or other written notice of revocation from the | ||
employee is received by an employer, If a notice of defense is | ||
received by an employer within the period
specified in Section | ||
4.1, no wages are subject to a demand served by the
creditor | ||
for that wage assignment and the employer shall cease any | ||
deduction of wages currently taking place for that wage | ||
assignment, described in that notice of defense; unless the | ||
employer receives
a copy of a subsequent written agreement | ||
between the creditor and employee
authorizing such payments. If | ||
such an agreement is not reached, the
creditor may not | ||
institute further proceedings on the wage assignment. If a
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notice of defense has been given, service of summons in any | ||
subsequent
proceeding on the debt for which the wage assignment | ||
was given as security
may be made by registered or certified | ||
mail.
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(Source: Laws 1967, p. 2049.)
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Section 99. Effective date. This Act takes effect January | ||
1, 2017. | ||