Illinois Supreme Court Affirms Tax Withholding on Public Employee Disability Payments

The Illinois Supreme Court affirmed the appellate court’s judgment that section 1(b) of the Illinois Public Employee Disability Act does not prohibit public employers from withholding employment taxes from disability payments. The case arose from a dispute between two police officers and the City of Pekin regarding tax withholdings from payments made while the officers were injured and unable to work. The court found that the statute’s requirement to pay injured employees “on the same basis” as before their injury allows for continued tax withholding, and that the law’s explicit prohibitions on certain deductions implied the exclusion of other prohibitions. ...