How to hire employees in Illinois

When you’re hiring employees in Illinois, you need to make sure you’re following all the laws and procedures for the state and federal governments. This includes registering your business, reporting new hires, collecting tax withholding information and providing workers’ compensation and unemployment insurance. This guide should help you understand what’s required to bring new hires into your business in the state of Illinois.


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Register as an employer

Before you can hire your first employee, you need to register your business and receive an Employer Identification Number. The IRS allows you to do this by filing Form SS-4. Once you’ve done so, you’ll receive a number that identifies your business for all employment and tax purposes. You also need to register your business with the State of Illinois Department of Revenue so you can withhold taxes and with the Illinois Department of Security to provide worker’s compensation insurance.


Check local areas before posting your job

Doing some research about the job offerings in your local area can help you determine how best to attract new candidates when hiring employees in Illinois, because each locality is home to different types of jobs, demographics and pay rates. If you’re looking for qualified candidates, you need to know what other businesses in your area are offering so your job posting can offer similar pay and incentives.


One of the best ways you can do this is to review sample job descriptions and compare job listings. In addition to seeing what other employers are paying, you’ll gain insight on how best to prepare your own listing to spark interest so that potential hires will contact you.


Assess candidates in Illinois

Once you begin receiving applications, make sure you consider whether each candidate is a true fit for the position. Things you’ll need to consider are experience, education, past work achievements and how well the candidate interviews with you. Sometimes, it’s better to wait for the right candidate than to rush because you need to fill a position.


Remote work is gaining in popularity, and advances in remote technology are making it much easier to employ people in positions that can be performed at home. If you choose to expand your search to remote candidates, you also benefit from having a larger pool of applicants. The person who’s perfect for your position might be too far away to commute to your location but able to exceed your expectations remotely.


Follow guidelines when hiring employees in Illinois

Even if you only need a single employee, there are laws in the state of Illinois that you need to follow when hiring new workers. Make sure you visit the Illinois Department of Employment Security’s website to research work laws that apply to the state. When you hire people to work for you, you’re required to withhold taxes, pay into Social Security (FICA) and provide workers’ compensation insurance in case they’re injured while working.


The laws you’re required to remain compliant with can vary from state to state, which is why the IDES website provides critical resources and information you need to know. Some of the Illinois new employee forms you need are also listed on the website.


New hire forms for Illinois

There’s specific paperwork you need to file with the state any time you hire a new employee. The IDES requires you to file a new hire reporting form within 20 days of hiring each employee. You’ll also need to collect and file the proper tax forms with the Illinois Department of Revenue and the IRS. You can find all the forms you’ll need by visiting each agency’s website and searching for new hire forms. Make sure you do your research and create an onboarding checklist to follow with each new hire.


Illinois new hire reporting

In order to report your new hires to the state, you’ll need to gather specific information. This information is also required for their tax forms and includes the new hire’s legal name, address, Social Security number, birthdate and start date. You’ll also need to provide your Employer Identification Number, the address for the physical location of your business, your phone number and the name you’re doing business under.


It’s important to note that if an employee ever leaves a position and then returns at another date, you’ll need to file all this information again when rehiring that person. One of the primary reasons the law requires you to report new hires is that it allows the IDES to track residents who may owe child support. You may be required to garnish a person’s wages for this purpose if you’re informed by the state of such a need.


Payroll in Illinois

After hiring employees in Illinois, you’re required as an employer to withhold taxes and Social Security from your employee’s pay and submit those funds to the state and federal governments. When you hire a new employee, you’re required to collect a W-4 so you have the employee’s information for tax reporting. At the beginning of each year, you must provide all your employees with a W-2 so they’re able to file their taxes. A W-2 shows how much an employee has earned, along with how much money has been withheld for federal taxes, Social Security and state taxes.


In addition to withholding taxes for your employees, you’re also required to provide unemployment insurance and workers’ compensation insurance. Unemployment insurance is a percentage of your employees’ wages, while workers’ compensation requires you to register through the Illinois Workers’ Compensation Commission. You need to file IRS Form 941 each quarter and then IRS Form 940 once a year to report any unemployment taxes you’re responsible for.


Posting signs in Illinois

The Illinois Department of Labor can provide you with the signs you need to display at your employee’s place of employment so that you’re compliant with labor laws for Illinois and the federal government. These signs must be accessible and visible, so the best places to put them are in breakrooms, meeting rooms or a high-traffic area that all your employees are likely to pass by.


The signs inform your employees about their rights as well as what their responsibilities are as workers. They’ll display information such as the minimum wage in Illinois, what to do if they’re injured and other rights that they have under labor laws specific to the state.


Stay Up to Date

Labor laws change from time to time, and these changes might have an impact on your business. Make sure you’re always aware of any new state or federal law that you need to follow when hiring new employees in Illinois so you aren’t subject to fines or legal problems. It’s always a good idea to do an annual review of the information listed on state websites, such as the Illinois Department of Labor, Illinois Department of Employment Security and Illinois Department of Revenue.


Hiring your first new employee can be both an exciting and a stressful experience. After you’ve found the perfect candidate, make sure you file all the proper paperwork and follow the guidance the state government provides concerning payroll and labor laws. The best way to do this is to make a checklist before hiring your first employee and using it for all your new hires in the future.

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