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13 November 2000

No. 2--99--1193

IN THE

APPELLATE COURT OF ILLINOIS

SECOND DISTRICT

JUSTICE GALASSO delivered the opinion of the court:

On January 9, 1997, plaintiff, Jay Miller, filed a complaint against defendant,Kiefer Specialty Flooring, Inc., seeking the payment of wages in the form ofcommissions and vacation pay alleged to be due and owing for services rendered todefendant in 1995 and 1996. Plaintiff claimed that defendant owed him over$24,000 in back wages. Following arbitration, the trial court entered a judgmenton the award for plaintiff in the amount of $10,598.03 plus costs for the wageclaim. The order was dated December 5, 1998, and file stamped December 8, 1998.

On March 11, 1999, plaintiff filed a motion for additional relief in the form ofinterest penalties pursuant to section 14(b) of the Illinois Wage Payment andCollection Act (Act) (820 ILCS 115/14(b) (West 1998)) for defendant's failure topay the judgment promptly within 15 days after its entry. On September 28, 1999,the trial court ordered defendant to pay an additional $8,372.44 in interestpenalties. Defendant timely appeals the penalty order, arguing that the courterred in awarding interest penalties under the provisions of the Act, becausedefendant did not wilfully refuse to pay the wages ordered to be paid by the trialcourt. We affirm.

There is no report of the proceedings, but since the essential facts areundisputed, the issue presented is one of law involving the construction andapplication of the relevant provisions of the Act. On February 13, 1997,defendant was initially defaulted for the failure to appear and answer thecomplaint. Defendant then filed its appearance and moved to vacate the default onMarch 17, 1997. The order of default was vacated and defendant moved to transfervenue. Plaintiff sought the production of relevant records from defendant andmoved to strike the motion for change of venue. The court ordered defendant tocomply with the production request. On September 4, 1997, defendant's motion totransfer venue was stricken for defendant's failure to comply with discovery.

Plaintiff again moved for a default order for defendant's failure to answer thecomplaint, and a second default order was entered on October 9, 1997. Defendant'ssecond motion to vacate the default was granted on January 1, 1998. On February5, 1998, plaintiff again successfully moved for a default order alleging thatdefendant had delayed in answering the complaint. Defendant filed another motionto vacate the default order on March 23, 1998, asserting that there had been ananswer to the complaint but that the file did not contain a file-stamped copy ofthe answer. The default order was vacated. On April 4, 1998, the court acceptedthe answer claimed to have been filed on February 4, 1998.

On June 25, 1998, the court again ordered defendant to comply with outstandingdiscovery on or before July 3, 1998. On July 10, 1998, plaintiff moved forsanctions against defendant for the failure to comply with discovery. On July 30,the court again ordered defendant to comply with discovery and to rescheduledepositions. On August 20, 1998, plaintiff again moved for sanctions fordefendant's failure to comply with discovery. On September 3, plaintiff's motionwas withdrawn apparently because defendant tendered certain answers in discovery.

On October 21, 1998, the arbitration panel awarded plaintiff $10,598.03 plus costsfor the wage claim. The panel also made a finding that defendant failed toparticipate in the hearing in good faith and in a meaningful manner. Defendantfiled a notice of rejection of the award. On December 3, 1998, plaintiffpetitioned for sanctions for defendant's failure to participate in arbitration ingood faith and prayed that defendant be debarred from rejecting the award. Inorders file stamped December 8, 1998, the court found that defendant failed toparticipate in good faith and in a meaningful manner and that defendant failed topresent sufficient evidence to rebut the finding of the arbitration panel. Plaintiff's motion was granted, and defendant was debarred from rejecting theaward. The court then entered judgment on the arbitration award.

On January 7, 1999, plaintiff filed an affidavit for nonwage garnishment and fileda motion for a turnover order on February 4, 1999, and the court entered aturnover order on February 11, 1999. On March 11, 1999, plaintiff soughtadditional relief in the form of statutory interest penalties under section 14(b)of the Act. The record contains a letter dated December 9, 1998, notifyingdefendant's counsel of plaintiff's intent to seek penalties under the Act if theaward was not paid within 15 days of the December 8 order. On March 3, 1999, thecourt denied defendant's January 7 motion to vacate the December 8 order. Thecourt found that the rejection fee of $200 had been dishonored for insufficientfunds and was therefore not timely paid within the requisite 30-day period. OnMay 27, 1999, the court entered an order that contained inter alia a stipulationthat defendant did not wilfully refuse to pay the December 8, 1998, judgment. Thematter was continued for briefing. On September 17, 1999, the court issued awritten memorandum decision denying defendant's motion to reconsider (a motionpresumably mailed on March 19 or filed on April 20, 1999; the motion is not foundin the record). The court construed section 14(b) of the Act as providing for thepayment to plaintiff of penalty interest of 1% per calender day for each calendarday of delay in paying the wages due because the defendant employer did not makepayment within 15 days of the order of December 8, 1998. The court also construedsection 14(b) as not requiring proof of defendant's wilfulness in failing to paythe wages before the penalty could be imposed.

On September 28, 1999, the court entered an order for the payment of an interestpenalty of $8,372.44 for the time period between December 8, 1998, and February25, 1999, the date the original judgment was satisfied. In an agreed order, theenforcement of the penalty was stayed pending appeal.

The issues before this court are (1) whether the provisions of the Act provide aprivate, civil cause of action for an employee such as plaintiff to collectinterest penalties upon the failure of the defendant employer to pay a judgment ororder within 15 days of its entry; (2) whether plaintiff must prove thatdefendant's failure to pay the amount ordered was wilful and whether acorrespondingly high standard of proof applies; and (3) whether any motion,objection, or request for reconsideration or for further relief from the ordertolls the accrual of daily penalty interest.

In 1974, the Act became law and replaced several existing statutes whoseprovisions had each been enacted separately; although their subject matter wassimilar, each earlier provision carried its own administrative or penalty section. Stafford v. Bowling, 85 Ill. App. 3d 978, 979 (1980). The Act added several newprovisions that gave the Department of Labor (Department) the authority to use avariety of approaches to enforce the Act and collect wages on behalf of employees. The Department may offer investigatory and conciliation services, may makefindings of fact and order the employer to pay wages owed to an employee, may addliquidated penalty damages, and may provide assistance to employees who wish toprosecute their own claims against their employers. Stafford, 85 Ill. App. 3d at980. Among other things, the Department was given the authority to initiatecriminal misdemeanor actions for violations of the Act independently and inaddition to the authority of the State's Attorneys of the various counties toprosecute criminal actions; and the Department has the discretion to pursue anyparticular remedy or penalty but is not mandated to do so. See 820 ILCS 115/6, 11(West 1998); Stafford, 85 Ill. App. 3d at 980-81.

Section 11(c) provides: "Nothing herein shall be construed to prevent any employeefrom making complaint or prosecuting his or her own claim for wages." 820 ILCS115/11(c) (West 1998). The purpose of the Act is to provide employees with acause of action for the timely and complete payment of earned wages or finalcompensation without retaliation from employers; this cause of action arises outof the employment contract. See Doherty v. Kahn, 289 Ill. App. 3d 544, 557-58(1997). It is clear that an aggrieved employee has a private, civil cause ofaction for the collection of wages that is entirely independent from theDepartment's enforcement powers, and a plaintiff is not required to obtain anorder or initial determination of liability from the Department before proceedingin a circuit court. Kahn, 289 Ill. App. 3d at 558; Nagel v. Gerald Dennen & Co.,272 Ill. App. 3d 516, 523-25 (1995) (employee not required to obtain Department'sinitial determination of liability or exhaust administrative remedies); Clark v.Western Union Telegraph Co., 141 Ill. App. 3d 174, 177 (1986).

Unlike criminal prosecutions for misdemeanor offenses, that is, for wilfulviolations of the Act (Ill. Rev. Stat. 1977, ch. 48, par. 39m--14 (now 820 ILCS115/14(a) (West 1998)), civil suits by aggrieved employees are governed by therules of civil procedure. Clark, 141 Ill. App.3d at 177 (discussing statute oflimitations for private civil suits under the Act). We observe that section 14 inthe 1977 version of the Act consisted of two paragraphs and was entitled "Refusalto pay wages or final compensation--Punishment--Failure to obey order to paywages--Penalty." Ill. Rev. Stat. 1977, ch. 48, par. 39m--14. The first paragraphdealt with wilful misdemeanor violations while the second paragraph dealt with thefailure to pay following an order of the Department or a court. The textualarrangement of the two paragraphs strongly suggests in itself that criminalpunishment for an offense was distinct from a (civil) penalty for the failure topay following the entry of an order.

Section 14 was amended in 1983 (Pub. Act 83--202,