No, with the following caveat, we do not believe that Illinois employers need to require their salaried exempt employees to maintain time records, notwithstanding apparent language to the contrary in the Illinois Department of Labor (IDOL) rules. However, not having your exempt employees record their daily time can involve some risk if a salaried non-exempt employee subsequently sues the bank for violating his or her rights to receive overtime payments.

The IDOL rules do require employers to maintain records of “the hours worked each day in each work week” for each employee, “regardless of an employee’s status as either an exempt administrative employee, executive or professional.” However, there is no express penalty in the law for noncompliance with this requirement. On the other hand, if an employee claims that he or she was misclassified as an exempt employee and demands overtime pay, the rules do provide that an employer cannot defend itself against that claim without producing the required records of the employee’s hours.

If your bank is confident that its salaried employees are correctly classified as exempt employees — meaning that they meet the “salary test” (at least $47,892 per year beginning December 1, 2016), as well as the “duties test” (having duties that are administrative, executive or professional in nature) — then the risk of a misclassification claim is low, and your decision to not require daily time records for salaried employees will not be penalized. However, if you are in doubt about the classification of any of your salaried employees, then we would recommend requiring them to maintain the required daily records (in addition to non-exempt employees, of course).

For resources related to our guidance, please see:

• Illinois Department of Labor Administrative Rules, 56 Ill. Admin. Code 300.630(a) (“Regardless of an employee’s status as either an exempt administrative employee, executive or professional, every employer shall make and maintain, for a period of not less than 3 years, the following true and accurate records for each employee: the name and address, the hours worked each day in each work week, the rate of pay, copies of all notices provided to the employee as required by subsection (d), the amount paid each pay period and all deductions made from wages or final compensation. . . .”)

• Illinois Department of Labor Administrative Rules, 56 Ill. Admin. Code 300.630(b) (“In the absence of employer records, a claimant may not be denied recovery of wages or final compensation on the basis that the employee is unable to prove the precise extent of uncompensated work or final compensation. An employee need only produce sufficient evidence to demonstrate the amount and extent of work or time earned as a just and reasonable inference. The employer must then produce evidence of the exact amount of work or time earned or produce evidence to negate the reasonable inferences drawn from the employee’s evidence. The employer’s failure to make and maintain records as required under subsection (a) shall not preclude a finding based on the information available that wages or final compensation are due, even though the award may be only approximate.”)