Illinois General Assembly - Full Text of SB2804
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Full Text of SB2804  99th General Assembly




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1    AN ACT concerning civil law.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 5. The Illinois Wage Assignment Act is amended by
5changing Sections 2, 2.1, 2.2, 4.1, and 4.2 as follows:
6    (740 ILCS 170/2)  (from Ch. 48, par. 39.2)
7    Sec. 2. Demand on an employer for the wages of wage-earner
8by virtue of a wage assignment may not be served on the
9employer unless:
10        (1) There has been a default of more than 40 days in
11    payment of the indebtedness secured by the assignment and
12    the default has continued to the date of the demand;
13        (2) The demand contains a correct statement as to the
14    amount the wage-earner is in default and the original or a
15    photostatic copy of the assignment is exhibited to the
16    employer; and
17        (3) Not less than 20 days before serving the demand,
18    notice required under Section 2.2 a notice of intention to
19    make the demand has been served upon the employee, and an
20    advice copy sent to the employer, by 2 methods: (i) first
21    class mail; and (ii) registered or certified mail.
22    Service of any demand without complying with this Section
23has no legal effect. Proof of certified mail is prima facie



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1evidence of service.
2    A demand under this Section applies only to wages due at
3the time of service of the demand and upon subsequent wages
4until the total amount due under the assignment is paid, or, if
5the wage assignment is revocable under federal law, until the
6employee revokes it or until the expiration of the employer's
7payroll period ending immediately prior to 84 days after
8service of such demand, whichever first occurs.
9(Source: P.A. 88-395.)
10    (740 ILCS 170/2.1)  (from Ch. 48, par. 39.2a)
11    Sec. 2.1. A demand shall be in the following form:
12    "Demand is hereby made upon an assignment of salary, wages,
13commissions or other compensation for services, executed by
14.... and delivered to .... on (insert date), to secure a debt
15contracted on (insert date).
16    The total amount of the debt is $..... Payments in the
17amount of $.... have been made. The duration of the contract is
18.... months. There is now due and owing without acceleration
19the sum of $...., the last payment having been made on (insert
21    The employee herein named has been in default in his
22payments in the amount of $...., of which $.... has been due
23and owing for more than 40 days.
24    Unless you have received a written notice from the employee
25herein named revoking the wage assignment within the past 20



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1days, or do receive within 5 days after the service hereof, a
2notice of defense from the employee herein named, you are
3required by law to make payment in accordance with such
4assignment. ...., first being duly sworn, deposes and says that
5the facts stated in the demand above are true and correct; and
6further deposes and says that he (or his principal, if he is an
7agent for the assignee) has not received notice from the debtor
8that he or she is revoking the wage assignment no notice of any
9defenses of the debtor.
10    Payments must be made until the total amount due under the
11assignment is paid or until the employee revokes the wage
14    Subscribed and sworn to before me on (insert date).
Notary Public".
17(Source: P.A. 91-357, eff. 7-29-99.)
18    (740 ILCS 170/2.2)  (from Ch. 48, par. 39.2b)
19    Sec. 2.2. Forms; notice of intent to assign wages;
21    (a) The notice to an employee required by Section 2 shall
22be in the following form:
24    This notice is required by the Illinois Wage Assignment
25Act. The notice has been sent to tell you that a creditor (name



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1and address listed below) plans to have your wages assigned. A
2wage assignment is a document you signed at the time you signed
3the contract for your debt. It authorizes your creditor to
4receive a portion of your wages directly from your employer, in
5order to pay your debt. This notice contains important
6information about the debt and what your options are. You
7should read the entire notice carefully.
9    You signed a wage assignment on ....... (date) ....... The
10wage assignment was signed as security if you failed to make
11payment on the contract you signed on ......... (date)
12.......... A copy of the wage assignment is attached. The
13creditor's records show that you have not made a payment since
14......... (date) ....... and that you now owe $........ on the
15contract. The creditor will send a demand for wages to your
16employer 20 days from the date you receive this.
18    If you have a legal defense to the wage assignment you can
19stop the wage assignment by filling out the enclosed Notice of
20Defense Form and (1) sending it to the creditor by registered
21or certified mail and (2) giving a copy to your employer. You
22must do those 2 things within 20 days of receiving this notice.
23You have the right to contact an attorney concerning the wage
24assignment. In the event a false defense is made, you will be
25subject to payment of attorneys' fees, court costs and other



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1    The creditor's name, and address, and phone number are:
(Signed by)"
7    (b) If the wage assignment is revocable under federal law,
8the notice required under subsection (a) shall also include the
12    There are options available to you in this process. You
13should consider your options and determine the one that is best
14for you. You have the right to contact an attorney at any point
15concerning the wage assignment, or to help you determine your
16best option.
17    Your options include:
18        (1) You can stop the wage assignment at any time, which
19    will stop your wages from being deducted. It will not
20    eliminate your debt, and interest may continue to accrue.
21    You may contact your creditor for more information about
22    the interest rate on your contract, and to determine how
23    much interest might accrue if you stop the wage assignment.
24        Your creditor will still be able to pursue other means
25    of collecting any debt you may owe, including filing a
26    lawsuit against you for the full amount owed under the



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1    contract and any interest that might accrue. A lawsuit
2    might result in you owing legal fees and other costs.
3        You can stop the wage assignment by filling out the
4    enclosed Revocation Notice Form, or by writing a letter
5    stating that you are revoking the wage assignment. Send the
6    Revocation Notice Form or letter by registered or certified
7    mail to the creditor, at the address listed above. It is
8    highly recommended that you give a copy of the Revocation
9    Notice Form or letter to your employer so your employer can
10    stop any pending payments.
11        If you choose to write a letter, it should be addressed
12    to the creditor, and should include:
13            (i) your name;
14            (ii) the account number; and
15            (iii) a statement that you are revoking the wage
16        assignment, such as, "I am revoking the wage
17        assignment."
18        Even if the wage assignment has already begun, you can
19    still stop it now or at any point in the future.
20        (2) You can do nothing, and allow the wage assignment
21    process to proceed. Starting in 20 days, part of your wages
22    will be sent directly to the creditor to pay off your debt.
23    This will reduce your take-home pay every pay period until
24    the total amount of the debt is repaid.
25        Up to 15% of your wages will be sent to the creditor
26    every pay period. Once the total amount is repaid, the



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1    creditor will send a notice to you and to your employer
2    that includes the creditor's name, your name, and the
3    account number, stating that the wage assignment is closed
4    and no further wages should be assigned.
5        (3) You can contact your creditor to repay the debt, or
6    to explore other options, including a repayment plan or
7    refinancing, if available. You can contact your creditor at
8    the address and phone number listed above.
9        If you agree on another repayment option with your
10    creditor, the creditor will send a notice to your employer
11    stating that your wages should not be assigned.
12    (c) If the wage assignment is revocable under federal law,
13the notice required under subsection (b) shall be accompanied
14by the following Revocation Notice Form, with the relevant
15information inserted by the creditor:
17The employee's name and address are:
22The creditor's name and address are:



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1Re: (insert account number)
2    I, (insert name), hereby revoke the wage assignment I
3signed on (insert date the wage assignment was signed). You no
4longer have my permission to use this wage assignment.
5......................    ......................
6(Signed by)               (Date)"
7(Source: P.A. 83-867.)
8    (740 ILCS 170/4.1)  (from Ch. 48, par. 39.4a)
9    Sec. 4.1. Revocation of wage assignment. If the wage
10assignment is revocable under federal law, the employee may
11revoke the wage assignment at any time by submitting the
12Revocation Notice Form as provided in subsection (c) of Section
132.2 of this Act or otherwise providing written notice of
14revocation to the creditor. Revocation is effective regardless
15of how the creditor receives it. Failure to use the sample
16language provided in the notice described in Section 2.2 does
17not affect the validity of the written notice of revocation.
18The employee may submit a copy of the notice to his or her
19employer. If the written notice of revocation is served upon
20the creditor prior to the creditor's service of demand upon the
21employer, the demand shall not be served. Within 20 days after
22receiving the notice required by Section 2 or within 5 days
23after service of the demand, the employee may notify his
24employer, in writing, of any defense he may have to the wage



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1assignment. A copy of such notice shall be served upon the
2creditor by registered or certified mail. If served upon the
3creditor prior to the creditor's service of demand upon the
4employer, such demand shall not be served by the creditor. The
5notice shall be by affidavit and shall be in substantially the
6following form:
7    "I, ...., hereby (swear) (affirm) that I have a bona fide
8defense to the claim of ...., which claim is based on a debt
9contracted on (insert date), and for security on which debt a
10wage assignment was executed.
Address for service of summons
15    Subscribed and sworn to before me on (insert date).
Notary Public
18(Source: P.A. 91-357, eff. 7-29-99.)
19    (740 ILCS 170/4.2)  (from Ch. 48, par. 39.4b)
20    Sec. 4.2.
21    If the employee has not served a Revocation Notice Form as
22provided in Section 4.1 of this Act or has not otherwise served
23the creditor with a written notice of revocation (if the wage
24assignment is revocable under federal law) given notice of
25defense as provided in this Act within 20 days after receiving



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1the notice of intention to make a demand, the creditor may
2proceed with his demand, and the employer shall commence
3payment to the creditor not sooner than 5 business days after
4service of such demand, if no revocation notice has been
5received by the employer unless a notice of defense is received
6within that 5 day period. If the employee cures the default
7stated in the demand or revokes the wage assignment, the
8creditor shall notify the employer and release the demand. No
9employer shall be liable for payments made in compliance with
10this Section.
11    If a Revocation Notice Form as set forth in Section 4.1 of
12this Act or other written notice of revocation from the
13employee is received by an employer, If a notice of defense is
14received by an employer within the period specified in Section
154.1, no wages are subject to a demand served by the creditor
16for that wage assignment and the employer shall cease any
17deduction of wages currently taking place for that wage
18assignment, described in that notice of defense; unless the
19employer receives a copy of a subsequent written agreement
20between the creditor and employee authorizing such payments. If
21such an agreement is not reached, the creditor may not
22institute further proceedings on the wage assignment. If a
23notice of defense has been given, service of summons in any
24subsequent proceeding on the debt for which the wage assignment
25was given as security may be made by registered or certified



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1(Source: Laws 1967, p. 2049.)
2    Section 99. Effective date. This Act takes effect January
31, 2017.