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Important Items of Note

Workers’ Compensation

By law, an employer is required to provide insurance for employees’ accidental deaths, injuries, and occupational diseases arising out of and in the course of employment. The insurance requirement is applicable to almost all businesses and must include provisions for all medical expenses, rehabilitation and retraining, temporary and total disability, permanent disability and death benefits. Insurance generally is purchased through private firms or agents, although business can apply to the commission for permission to self-insure. Annual premiums are based on total company payroll, loss experience and type of business. Employers must post a notice in the workplace listing the insurance carrier and explaining workers’ rights under the law. Temporary workers who otherwise do not receive any company benefits are still provided workers' compensation.

If you are refused coverage by two or more companies, you can obtain insurance from the Assigned Risk Pool. Rates will be approximately 20 percent higher than the open market.

Unemployment Insurance

You may be required to make unemployment insurance contributions to the Illinois Department of Employment Security (IDES). Generally, you are liable for such contributions if you have:

  1. paid at least $1,500 in wages in a single calendar quarter, or employed one or more persons for 20 weeks in a given calendar year
  2. paid at least $1,000 in cash wages in one calendar quarter for domestic work
  3. paid at least $20,000 in cash wages in one calendar quarter or employed 10 or more workers for 20 weeks in a given calendar year for farm work.

Non-profit organizations are liable for the year when it has employed 4 or more workers for every 20 weeks in a given calendar year. Every newly created business (employing unit) must register with IDES within 30 days of start-up. Use the UI-1 form, "Report to Determine Liability under the Illinois Unemployment Insurance Act".

Most new employers are responsible for making contributions between .55-8.95% of each worker's wages up to $12,900 per calendar year. (There are other rates for certain industries such as construction, mining and agriculture.)

You also may be liable if you acquire all or part of a business already subject to the Unemployment Insurance Act. To determine liability, complete a "Report to Determine Liability" form and submit it to the Unemployment Insurance Revenue Division of IDES. If it is determined that you are liable, an account number will be assigned and reporting forms mailed to you each quarter. Reports and contributions are due no later than the last day of the month following the end of the calendar quarter. Reports must be filed quarterly listing the workers' wages even if there is no contribution due because all of the workers have already reached the $12,900 threshold.

IDES accepts MasterCard and Visa credit and debit cards online or by phone at (866) 268-3956 for employer payments of quarterly unemployment insurance obligations. If you have more questions, contact: 

Illinois Department of Employment Security (IDES)
(800) 247-4984

Occupational Safety and Health Administration

Employers are responsible for providing a safe and healthful workplace for their employees. The Occupational Safety and Health Administration's (OSHA's) role is to assure the safety and health of
America's workers by setting and enforcing standards; providing training, outreach and education; establishing partnerships; and encouraging continual improvement in workplace safety and health.

OSHA rules for recording and reporting occupational injuries and illnesses affect 1.4 million establishments. Small businesses with 10 or fewer employees throughout the year are exempt from most of the requirements of the OSHA record-keeping rules, as are a number of specific industries in the retail, service, finance, insurance and real estate sectors that are classified as low-hazard. The OSHA record-keeping system has five steps that are outlined in their Small Business Handbook. An employer is required to report to OSHA within eight hours of the accident, all work-related fatalities or multiple hospitalizations that involve three or more employees.

Employers are required to continually display a poster prepared by the U. S. Department of Labor that informs employees of their rights under OSHA. The poster, which is available in different languages, must be displayed in a conspicuous place where employees can see it. Private employers may use the poster available from OSHA’s website, or a suitable reproduction or facsimile. OSHA’s posters are free of charge. The Industrial Services Office of the Illinois Department of Labor offers free, confidential pre-inspection consultation services which are designed to prevent citations and penalties resulting from the actual federal OSHA inspection. Consultants assist employers in complying with OSHA workplace safety and health standards in developing a complete safety and health program to eliminate employee lost time, production downtime and material damage in their operation.

Environmental Standards

The U.S. Environmental Protection Agency establishes standards for various air and water pollutants such as sulfur dioxide, carbon monoxide, ozone, hydrocarbons and dust. States are required to enforce the federal standards. For more information on Illinois' environmental standards contact:

Illinois Environmental Protection Agency
1021 N. Grand Avenue East
Springfield, IL 62702
(217) 782-3397
TDD: (217)782-9143 

Uniform Commercial Code

Chapter 810, Illinois Compiled Statutes, Act 5, Article 9, Part 1, contains the provisions of the
Uniform Commercial Code - Secured Transactions. If you borrow money using certain items
of commercial property as collateral, the lender has the right to file a lien on that property with
the Secretary of State's Office, Uniform Commercial Code Division. This guarantees the lender
first rights to the property if you default on loan payments or file for bankruptcy. For more information, contact:

Illinois Secretary of State
Voice: (217) 782-7518
TDD: (800) 252-2904

Posters That Must Be Displayed and Other Labor Requirements

Federal and state laws require that certain posters be displayed on business premises to inform employees of their rights and benefits. These posters may be obtained at no cost from the applicable agencies listed. (NOTE: Beware of those that would attempt to sell these items.)

Equal Employment Opportunity Commission (EEOC): The law requires an employer to post notices describing the Federal law prohibiting job discrimination based on race, color, sex, national origin, religion, age, equal pay, disability and genetic information. EEOC’s poster entitled, “Equal Employment Opportunity is the Law” is available in English, Arabic, Chinese and Spanish. You may order up to 5 copies from their website. Businesses with 15 or more employees must display this poster. The “Equal Employment Opportunity is the Law” poster is available online to order or print.

U.S. Department of Labor (USDOL): Businesses with one or more employees must display certain posters to inform employees of their rights. Some of the statutes and regulations enforced by agencies within the U. S. Department of Labor require that posters or notices be posted in the workplace. USDOL provides electronic copies of the required posters and some of the posters are available in languages other than English. You can find more information on compliance assistance matters and print your own posters, and all posters are available online to order or print.

Illinois Workers’ Compensation Commission: Employers must display a workplace notice listing the insurance carrier and explaining workers’ rights under the Workers’ Compensation Act. The notice is available online to print.

The Illinois Department of Labor (IDOL): Employers must display the poster entitled "Notice to Employers and Employees." IDOL is responsible for enforcement of laws which protect Illinois workers. These laws provide a workplace in which employer and employee are each bound by the same impartial laws and standards.The Illinois Department of Labor’s posters are available online to print or order.

Immigration Reform and Control Act

The Federal Immigration Reform and Control Act of 1986 (IRCA) requires every employer to keep on file a form for every employee certifying such employee's identity and work eligibility. Under IRCA, employers may hire only persons who may legally work in the U.S., i.e., citizens and nationals of the U.S. and aliens authorized to work in the U.S. The employer must verify the identity and employment eligibility of anyone to be hired, which includes completing the Employment Eligibility Verification Form (I-9).

Employers must keep each I-9 on file for at least three years, or one year after employment
ends, whichever is longer. On April 28, 2005, a new law took effect allowing employers to sign
and store Forms I-9 electronically.

Employment-related immigration regulations and procedures are based on legislation passed by Congress and can be complex. To assist employers, U.S. Citizenship and Immigration Services
has structured a wide range of information to inform employers on employment,
business, investment, training, and related immigration subjects.

Securities Regulation

Many financing plans for small businesses involve, at least in part, the issuance of securities.
Some of the most common forms of securities utilized by small businesses are common or
preferred stock, limited partnership interests, debt with an option to convert into stock and
warrants to purchase stock. Debt financing obtained from parties other than commercial lenders also may involve a security.

Securities must be registered with the Secretary of State's Office, Securities Department, before
being offered or sold in Illinois, unless the securities are exempt from the registration
requirements. Persons selling the securities also may have to be licensed by the Securities
Department. If the business is seeking securities financing in any other state, it probably will
also have to comply with federal and the other states' securities registration requirements.
Consult an attorney about whether your financing plan involves securities and the applicable
registration requirements and exemptions.

Illinois Secretary of State, Securities Department
(217) 782-2256
TDD: (800) 252-2904

Wage Withholding for Child Support

Federal and state laws require judges in domestic relations cases to order employers to withhold a portion of an employee's income for payment of child support. The order is mandatory in cases involving people who receive assistance from the Illinois Department of Human Services. When an Income Withholding Notice is served on the employer, the employer withholds the amount stated and sends the amount withheld to the State Disbursement Unit. If the employer fails to withhold wages as specified in the Notice, the employer will be liable for the amount that should have been withheld, and may have to pay a fine.

An employer may not discharge, discipline, deny employment or otherwise penalize an employee because he/she is subject to an Income Withholding Notice. An employer who does so may be ordered to employ, reinstate and/or pay restitution to the employee. A fine also may be imposed by the Court on the employer.

For more specific information on provisions of Wage Withholding for Child Support, contact the Illinois Department of Healthcare and Family Services.