Illinois: Direct Deposit and Payroll Card Requirements

Requirements one by one

Direct deposit and payroll cards are voluntary

The Wage Payment and Collection Act applies broadly under 820 ILCS 115/1,
including to local-government and school-district employees, but excludes State
and federal employees. Section 4 (820 ILCS 115/4) permits cash, a check redeemable
on demand without discount, deposit to an account at an institution the employee
designates, or a payroll card meeting § 14.5.

The Department of Labor rule at 56 Ill. Adm. Code § 300.600 makes the choice
express. Direct deposit requires voluntary acceptance and voluntary bank or
institution designation. A payroll card requires voluntary written or
electronic consent. An employer offering either method must also offer cash or
check; offering only direct deposit and a payroll card is not enough.

Payroll-card disclosure precedes consent

Before starting card payment, § 14.5(2) requires a clear and conspicuous written
disclosure saying that the card is voluntary and listing the other payment
methods. It must explain the account terms, itemize all employer or issuer fees,
warn about possible third-party transaction fees, and explain how to obtain net
wages, balances, and paper or electronic transaction histories without cost.

The employer must separately offer another § 4-compliant payment method and
obtain voluntary written or electronic consent. Card payment cannot be a
condition of employment, benefits, or another form of remuneration.

Free access includes wages, history, and balance

Section 14.5(3) requires at least one method of withdrawing the full net wages
once each pay period, but no less than twice per month, without cost at a
readily available location. At the employee's request, the program must provide
one free paper or electronic transaction history each month showing deposits,
withdrawals, deductions, and charges. Unlimited telephone balance access must
also be free.

The program cannot charge for point-of-sale transactions, application,
initiation, employer wage loading, or participation. It must provide two free
declined transactions per month; later declined transactions that month may
carry a commercially reasonable processing fee. An inactivity fee may begin
after one year of inactivity. The card cannot be linked to overdraft service,
a loan against future pay, a cash advance on future pay, or other credit.

The employee may switch within two pay periods

Under § 14.5(6), a card-paid employee may request another payment method the
employer offers under § 4. The employer must begin the requested allowable
method within two pay periods.

Card duties continue after separation

Final compensation is due at separation if possible and no later than the next
regularly scheduled payday under 820 ILCS 115/5. A payroll card may deliver
final compensation for a consenting employee because § 4 includes a compliant
card among the permitted methods.

The employer's § 14.5 duties end 60 days after both the employment relationship
has ended and full final wages have been paid. Within 30 days after termination,
the employer must tell the employee that account terms may change if the
employee continues with the card issuer.

Under 820 ILCS 115/14(a), an employee not timely paid may recover through a
Department of Labor claim or civil action, but not both, the underpayment plus
5% for each month it remains unpaid. A civil action also carries costs and
reasonable attorney's fees.

What trips people up

Two voluntary electronic methods do not make a complete menu. If the
employer offers direct deposit, a payroll card, or both, § 300.600 still
requires an additional cash-or-check choice.

The full-wage access floor can be more frequent than payroll. The card must
allow a free full-net-wage withdrawal once per pay period, but never less than
twice each month.

Employer card duties do not end on the last workday. They continue until 60
days after employment ends and the employee has received full final wages.

Common questions

Can an employer choose the bank for my direct deposit?

No. Section 300.600 requires the employee to voluntarily designate the bank
or other financial institution, and § 4 describes deposit to an account at an
institution designated by the employee.

Is a monthly transaction history free?

Yes, when requested. The employee may choose paper or electronic form, and the
history must show deposits, withdrawals, deductions, and charges.

Can a payroll card include overdraft protection?

No. Section 14.5(5) bars linking the card or account to any form of credit,
including overdraft services, a loan against future pay, or a future-pay cash
advance.

Statutes and sources

• 820 ILCS 115/1 and /4. Coverage and permitted wage-payment methods,
  including employee institution designation. Official § 1
  and official § 4
  (accessed July 14, 2026).
• 56 Ill. Adm. Code § 300.600. Voluntary direct deposit and payroll cards,
  cash/check alternative, and equal payment options. Official regulation
  (accessed July 14, 2026).
• 820 ILCS 115/14.5. Card disclosure and consent, free wage/history/balance
  access, prohibited fees and credit, method changes, and post-employment duties.
  Official current text
  (accessed July 14, 2026).
• 820 ILCS 115/5 and /14(a). Final-pay timing and underpayment remedies.
  Official § 5
  and official § 14
  (accessed July 14, 2026).