Illinois General Assembly - Full Text of HB5776
Illinois General Assembly

Previous General Assemblies

Full Text of HB5776  99th General Assembly




State of Illinois
2015 and 2016


Introduced , by Rep. Emanuel Chris Welch


740 ILCS 170/2  from Ch. 48, par. 39.2
740 ILCS 170/2.1  from Ch. 48, par. 39.2a
740 ILCS 170/2.2  from Ch. 48, par. 39.2b
740 ILCS 170/4.1  from Ch. 48, par. 39.4a
740 ILCS 170/4.2  from Ch. 48, par. 39.4b

    Amends the Illinois Wage Assignment Act. Provides that an employee may revoke a wage assignment at any time by submitting written notice that he or she is revoking the wage assignment to the creditor. Makes corresponding changes.

LRB099 18520 HEP 44879 b





HB5776LRB099 18520 HEP 44879 b

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, a
18    notice of intention to make the demand and a revocation
19    notice form 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.



HB5776- 2 -LRB099 18520 HEP 44879 b

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



HB5776- 3 -LRB099 18520 HEP 44879 b

1hereof, a notice of defense from the employee herein named, you
2are required by law to make payment in accordance with such
3assignment. ...., first being duly sworn, deposes and says that
4the facts stated in the demand above are true and correct; and
5further deposes and says that he (or his principal, if he is an
6agent for the assignee) has not been notified by the debtor
7that he or she is revoking the wage assignment no notice of any
8defenses of the debtor.
9    Payments must be made until the total amount due under the
10assignment is paid, until the employee revokes the wage
11assignment, or until the expiration of the employer's payroll
12period ending immediately prior to 84 days after service of
13such demand, whichever first occurs.
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 170/2.2)  (from Ch. 48, par. 39.2b)
20    Sec. 2.2. Forms; notice of intent to assign wages;
22    (a) The notice to an employee required by Section 2 shall
23be in the following form:
25    This notice is required by the Illinois Wage Assignment



HB5776- 4 -LRB099 18520 HEP 44879 b

1Act. The notice has been sent to tell you that a creditor (name
2and address listed below) plans to have your wages assigned.
3This notice contains important information. You should read the
4entire notice carefully.
6    You signed a wage assignment on ....... (date) ....... The
7wage assignment was signed as security if you failed to make
8payment on the contract you signed on ......... (date)
9.......... A copy of the wage assignment is attached. The
10creditor's records show that you have not made a payment since
11......... (date) ....... and that you now owe $........ on the
12contract. The creditor will send a demand for wages to your
13employer 20 days from the date you receive this.
15    You If you have a legal defense to the wage assignment you
16can stop the wage assignment at any time by filling out the
17enclosed Revocation Notice of Defense Form or by writing a
18letter stating that you are revoking the wage assignment and
19(1) sending it to the creditor by registered or certified mail.
20If you choose to revoke the wage assignment, it is highly
21recommended that you give a copy to your employer so your
22employer can stop any pending payments. Submitting this form or
23a letter will not eliminate your debt; it simply stops your
24wages from being assigned. The wage assignment will begin 20
25days after you receive this notice. You can stop the wage
26assignment at any time before or after the wage assignment



HB5776- 5 -LRB099 18520 HEP 44879 b

1begins. If you choose to write a letter, it should include:
2        (i) your name;
3        (ii) the account number; and
4        (iii) the following statement: "I am revoking the wage
5    assignment. You no longer have my permission to use this
6    wage assignment."
7    The letter should be addressed to the creditor at the
8address listed on this notice and sent by registered or
9certified mail. You have the right to contact an attorney
10concerning the wage assignment or the loan product. and (2)
11giving a copy to your employer. You must do those 2 things
12within 20 days of receiving this notice. You have the right to
13contact an attorney concerning the wage assignment. In the
14event a false defense is made, you will be subject to payment
15of attorneys' fees, court costs and other expenses.
16    The creditor's name and address are:
(Signed by)"
22    (b) The Notice of Intent to Assign Wages to an employee
23required by Section 2 of this Act shall be accompanied by the
24following Revocation Notice Form, with the relevant
25information inserted by the creditor:



HB5776- 6 -LRB099 18520 HEP 44879 b

1The employee's name and address are:
6The creditor's name and address are:
11Re: (insert account number)
12    I, (insert name), hereby revoke your right to use the wage
13assignment I signed on (insert date the wage assignment was
14signed). You no longer have my permission to use this wage
16......................    ......................
17(Signed by)               (Date)"
18(Source: P.A. 83-867.)
19    (740 ILCS 170/4.1)  (from Ch. 48, par. 39.4a)
20    Sec. 4.1. Revocation of wage assignment. The employee may
21revoke the wage assignment at any time by submitting the
22revocation notice as provided in subsection (b) of Section 2.2
23of this Act or otherwise providing written notice that he or
24she is revoking the wage assignment to the creditor. Regardless



HB5776- 7 -LRB099 18520 HEP 44879 b

1of how the employee serves the revocation notice, the
2revocation notice is not void if the creditor receives the
3revocation notice. Failure to use the sample language provided
4in the notice described in Section 2.2 does not make the letter
5revoking the wage assignment void. The employee may submit a
6copy of the notice to his or her employer if the employee so
7chooses. If the revocation notice is served upon the creditor
8prior to the creditor's service of demand upon the employer,
9the demand shall not be served by the creditor. Within 20 days
10after receiving the notice required by Section 2 or within 5
11days after service of the demand, the employee may notify his
12employer, in writing, of any defense he may have to the wage
13assignment. A copy of such notice shall be served upon the
14creditor by registered or certified mail. If served upon the
15creditor prior to the creditor's service of demand upon the
16employer, such demand shall not be served by the creditor. The
17notice shall be by affidavit and shall be in substantially the
18following form:
19    "I, ...., hereby (swear) (affirm) that I have a bona fide
20defense to the claim of ...., which claim is based on a debt
21contracted on (insert date), and for security on which debt a
22wage assignment was executed.
Address for service of summons



HB5776- 8 -LRB099 18520 HEP 44879 b

1    Subscribed and sworn to before me on (insert date).
Notary Public
4(Source: P.A. 91-357, eff. 7-29-99.)
5    (740 ILCS 170/4.2)  (from Ch. 48, par. 39.4b)
6    Sec. 4.2.
7    If the employee has not given a revocation notice as
8provided in Section 4.1 of this Act or has not otherwise
9provided the creditor with written notice that he or she is
10revoking the wage assignment notice of defense as provided in
11this Act within 20 days after receiving the notice of intention
12to make a demand, the creditor may proceed with his demand, and
13the employer shall commence payment to the creditor not sooner
14than 5 business days after service of such demand, unless a
15revocation notice as set forth Section 4.1 of this Act or other
16written notice from the employee revoking the wage assignment
17is received by the employer notice of defense is received
18within that 5 day period. If the employee cures the default
19stated in the demand or revokes the wage assignment, the
20creditor shall notify the employer and release the demand. No
21employer shall be liable for payments made in compliance with
22this Section.
23    If a revocation notice as set forth in Section 4.1 of this
24Act or other written notice from the employee revoking the wage
25assignment is received by an employer, If a notice of defense



HB5776- 9 -LRB099 18520 HEP 44879 b

1is received by an employer within the period specified in
2Section 4.1, no wages are subject to a demand served by the
3creditor and the employer shall cease any pending wage
4assignments described in that notice of defense; unless the
5employer receives a copy of a subsequent written agreement
6between the creditor and employee authorizing such payments. If
7such an agreement is not reached, the creditor may not
8institute further proceedings on the wage assignment. If a
9notice of defense has been given, service of summons in any
10subsequent proceeding on the debt for which the wage assignment
11was given as security may be made by registered or certified
13(Source: Laws 1967, p. 2049.)