Illinois New Hire Requirements
Hiring a new employee in Illinois involves more than extending a job offer. Employers must comply with both federal and Illinois employment laws covering employment eligibility verification, payroll registration, tax withholding, new hire reporting, employee classification, workers' compensation, and workplace notices.
Developing a standardized onboarding process helps employers remain compliant while creating a positive experience for new employees.
This guide outlines the primary new hire requirements Illinois employers should understand.
Verify Employment Eligibility
Every employer must verify that newly hired employees are legally authorized to work in the United States.
Employers should:
- Complete Form I-9.
- Review acceptable identity and work authorization documents.
- Complete the form within the required federal deadlines.
- Retain Form I-9 according to federal recordkeeping requirements.
Illinois also has laws governing the use of E-Verify. Most private employers are not required by Illinois law to use E-Verify unless federal law or a federal contract requires it. Employers that voluntarily use E-Verify must comply with applicable state restrictions and employee notification requirements.
Federal and State Tax Forms
Before processing payroll, employers should collect:
- Federal Form W-4.
- Illinois Form IL-W-4 (Employee's Illinois Withholding Allowance Certificate).
- Direct deposit authorization, if offered.
- Emergency contact information.
- Any company-specific employment forms.
Accurate payroll documentation helps employers comply with state and federal tax requirements.
Register as an Employer
Before hiring employees, businesses generally should:
- Obtain a Federal Employer Identification Number (EIN).
- Register with the Illinois Department of Revenue for withholding taxes.
- Register with the Illinois Department of Employment Security (IDES) for unemployment insurance.
- Obtain workers' compensation insurance when required.
- Establish payroll reporting procedures.
Report New Hires
Illinois employers are required to report all newly hired and rehired employees, including independent contractors, to the Illinois Directory of New Hires.
Reports generally include:
- Employee name.
- Address.
- Social Security number.
- Date of hire.
- Employer name.
- Employer address.
- Federal Employer Identification Number (FEIN).
Reports generally must be submitted within 20 days of the employee's first day on the payroll.
Employee Classification
Before employment begins, employers should properly classify workers as:
- Employees or independent contractors.
- Exempt or non-exempt employees.
- Full-time or part-time employees.
Improper classification can lead to wage claims, payroll tax issues, unemployment disputes, and other legal consequences.
Workers' Compensation Insurance
Illinois law generally requires employers to maintain workers' compensation insurance, even if the business has only one employee, with limited exceptions.
Employers should:
- Obtain required coverage.
- Report workplace injuries promptly.
- Maintain required records.
- Display required workers' compensation notices.
Workers' compensation protects both employers and employees following workplace injuries.
Workplace Policies
New employees should receive important workplace information during orientation, including:
- Employee handbook.
- Attendance policies.
- Workplace conduct expectations.
- Anti-discrimination and anti-harassment policies.
- Paid Leave for All Workers Act policies.
- Safety procedures.
- Emergency procedures.
- Technology and internet use policies.
- Complaint reporting procedures.
Providing written policies helps establish clear expectations from the employee's first day.
Required Workplace Posters
Most Illinois employers are required to display applicable Illinois and federal labor law posters where employees can easily read them.
New employees should know where workplace posters are located because they explain important rights involving wages, paid leave, workplace safety, unemployment insurance, workers' compensation, and equal employment opportunity.
Employers should review posting requirements regularly and replace outdated notices whenever new versions are issued.
Employer Best Practices
Illinois employers should:
- Use a standardized onboarding checklist.
- Complete Form I-9 promptly.
- Collect all required payroll forms.
- Register with applicable state agencies.
- Report new hires within the required timeframe.
- Maintain workers' compensation insurance.
- Provide an employee handbook.
- Display current labor law posters.
- Maintain organized personnel records.
- Review hiring procedures annually.
Consistent onboarding procedures help employers remain compliant while creating a successful start for every new employee.
Labor Law Poster Compliance
Most Illinois employers are required to display current federal and Illinois labor law posters where employees can easily read them.
View our professionally updated Illinois State & Federal Labor Law Poster here:
https://www.laborlawhrsigns.com/illinois-state-and-federal-labor-law-poster-il
Official Government Resources
Illinois Department of Employment Security – New Hire Reporting
https://ides.illinois.gov/employer-resources/taxes-reporting/new-hires.html
Illinois Department of Labor
U.S. Citizenship and Immigration Services – Form I-9
Illinois Department of Revenue
Frequently Asked Questions
Do Illinois employers have to report new hires?
Yes. Illinois employers must report newly hired and rehired employees, including independent contractors, to the Illinois Directory of New Hires within 20 days of the employee's first day on the payroll.
Is E-Verify required in Illinois?
Generally, no. Illinois law does not require most private employers to use E-Verify unless federal law or a federal contract requires it. Employers that use E-Verify must comply with Illinois requirements governing its use.
What forms are required for a new employee?
Most employers should complete Form I-9, collect Federal Form W-4 and Illinois Form IL-W-4, and obtain any company-specific employment documents before processing payroll.
Do Illinois employers need workers' compensation insurance?
Yes. Most Illinois employers are required to maintain workers' compensation insurance, even if they have only one employee, subject to limited statutory exceptions.
Are labor law posters required?
Yes. Most Illinois employers must display applicable Illinois and federal labor law posters where employees can easily read them.
Where can I obtain an updated Illinois Labor Law Poster?
You can purchase a professionally updated Illinois State & Federal Labor Law Poster here:
https://www.laborlawhrsigns.com/illinois-state-and-federal-labor-law-poster-il
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