Last verified: September 2026
Quick answer: In Illinois, final wages are due no later than the next regular payday after separation — whether the employee quit, was fired, or was laid off. And critically: earned vacation must be paid out. Illinois bans use-it-or-lose-it policies outright.
The deadlines: fired vs. quit
- Involuntary termination: next regular payday (pay at separation if possible). Illinois Wage Payment and Collection Act, 820 ILCS 115.
- Voluntary quit: next regular payday.
- No distinction — one deadline for every kind of separation.
What must be in the final paycheck
- All wages through the last day worked, including overtime.
- Earned vacation — mandatory payout. Illinois is one of the strictest states here: any vacation the employee has earned must be paid at separation, and policies that forfeit it (“use it or lose it”) are unenforceable in Illinois.
- Commissions and bonuses: payable when earned per the agreement.
- Deductions: only with the employee’s written consent, given freely at the time of the deduction.
Penalties for late payment
- Damages of 2% per month on the underpaid amount, accruing from the date payment was due.
- Illinois Department of Labor enforcement and wage claims.
- Employees may also bring private actions, with attorney’s fees available to prevailing employees.
Compliance checklist for Illinois employers
- Deadline = next payday. Put it on the calendar the day of separation.
- Calculate the vacation balance from payroll records — never estimate, and never apply a forfeiture rule.
- Review your handbook now: if it contains use-it-or-lose-it language, it’s void in Illinois. Rewrite it before it costs you.
- Include earned commissions and bonuses per the agreement terms.
- Get written consent for any deduction, dated at the time — blanket authorizations signed at hire don’t count.
Illinois vs. federal law
Federal law: no deadline, no vacation payout requirement. Illinois: next-payday deadline, mandatory vacation payout, a ban on forfeiture policies, and monthly compounding damages. One of the most employee-protective final-pay regimes in the country.
FAQ
Is use-it-or-lose-it really illegal in Illinois?
Yes. Illinois courts have consistently held that earned vacation is wages and cannot be forfeited. You can cap accruals going forward (with proper notice), but you can’t wipe out what’s earned.
Does Illinois require payout of unused sick leave?
No — the mandatory payout applies to vacation, not sick leave (unless your policy promises it).
What if the employee quits without notice?
Same deadline: next regular payday. Illinois doesn’t extend the timeline for no-notice quits.
Can I deduct for a cash shortage from the final check?
Only with the employee’s written consent given freely at the time of the deduction — and deductions that cut into minimum wage or overtime are never allowed.
Related guides
This page provides general information about Illinois final paycheck law, not legal advice. Verify deadlines with the Illinois Department of Labor or an employment attorney for your situation.