Chicago Business Litigation Lawyer Blog
As an employee, you may have come across the term “non-compete agreement” during your job search or employment. Non-compete agreements, also known as restrictive covenants, are contractual clauses that restrict an employee’s ability to work for a competing business for a certain period after leaving their current job.
In Illinois, non-compete agreements are governed by the Illinois Freedom to Work Act. This law, which went into effect in 2017, makes it clear that employers cannot restrict low-wage employees from taking other jobs or working for competitors.
However, for other employees, non-compete agreements may be enforceable under certain conditions. According to the Illinois law, for a non-compete agreement to be enforceable, it must be:
- Ancillary to a valid employment agreement: The non-compete agreement must be part of an employment contract, and the employee must receive consideration (such as a job offer, a promotion, or a bonus) in exchange for agreeing to the restriction.
- Reasonable: The non-compete agreement must be reasonable in scope, geographic area, and duration. This means that the restrictions must be necessary to protect the employer’s legitimate business interests and must not impose an undue burden on the employee.
- Not against public policy: The non-compete agreement cannot be contrary to the public interest or public policy. For example, it cannot restrict an employee’s right to work in their chosen profession or industry.
- The employer has not breached the employment agreement first. This can include engaging in illegal behavior which forces the employee to resign.
If a non-compete agreement meets these criteria, it may be enforceable in Illinois. However, even if an agreement is enforceable, it does not mean that it will be enforced by a court. Illinois courts will only enforce a non-compete agreement if it is necessary to protect the employer’s legitimate business interests and if the restrictions are reasonable.
It is important for employees to understand their rights and obligations under non-compete agreements. Before signing an employment contract that includes a non-compete clause, employees should carefully review the terms and seek legal advice if necessary. Employees should also be aware of their obligations under the agreement, including any restrictions on their ability to work for competitors after leaving their current job.
In summary, non-compete agreements can be a complex issue for employees in Illinois. While they may be enforceable under certain conditions, employees should be aware of their rights and obligations under these agreements and seek legal advice if necessary. By understanding the law and their rights, employees can make informed decisions about their employment and protect their career opportunities.
Call one of our experienced Illinois non-compete, NDA or restrictive covenant lawyers for a free consultation at 630-333-0333. We have offices throughout the Chicagoland area including near Lake Forest, Glen Ellyn and in downtown Chicago.