What is a Non-Solicit Agreement?
Restrictive covenants can be included in employment contracts to help protect the future of a business’s prospects. When a business spends a long time developing the skill set of their employees, it can be difficult for them to see those same employees one day leave their company and sign on with a competitor. Restrictive covenants, like non-solicit clauses, non-compete agreements, and non-disclosure agreements, can restrict what a former employee does in their future employment.
Non-solicitation agreements are restrictive covenants that limit an ex-employee’s ability to solicit workers, customers, or clients after they leave a position of employment. A non-solicitation agreement, or ‘covenant not to solicit,’ is especially useful for employers who fear losing members of their talented team or who cannot afford to see their customer base stolen by a rival competitor.
Non-solicit agreements, as well as other restrictive covenants, can be challenging to enforce. The laws are now increasingly in favor of the employees. To ensure that your interests are looked after, it is strongly recommended that you seek legal counsel in the form of an experienced employment law attorney. Please contact our law firm for an in-depth case evaluation.
What Are the New Laws Restricting Non-Solicit Agreements?
The newly implemented Illinois Freedom to Work Act put restrictive limits on all restrictive covenants in the state, requiring previously drafted documents to be revised and future agreements to meet the new standards.
Under the new laws, employers must provide employees with at least 14 days to review a non-solicit clause. Additionally, they must remind prospective employees of their right to retain legal counsel. To be valid, an employee signing a restrictive covenant must receive something of value in return, such as a guarantee of employment for a certain period, a signing bonus, or other benefits.
Non-solicitation agreements cannot be issued to employees earning less than $45,000 annually. This number will increase in 2027 and every five years after that.
What Are Tips for Negotiating a Non-Solicitation Agreement?
Every component of a restrictive covenant agreement can be negotiated. Both employees and employers should consider working together to come to a more mutually beneficial agreement so that both sides walk away feeling happy and content.
Here, we will present several tips for employees and employers in negotiating non-solicitation clauses.
Seek Professional Legal Counsel
Whether you are an employer or an employee, it is strongly recommended that you seek a lawyer with experience in labor law and employment law to represent your interests. A lawyer can help you better understand the negotiated agreement and the laws that allow the agreement to be enforceable. Hiring a lawyer will result in extra legal fees, but considering how much you gain from a satisfactory employment contract versus how much you could lose with a poorly drafted agreement, the lawyer more than pays for itself.
Time is Precious
Restrictive covenant employment contracts that require an employee to stand by the terms of the contract for many years can be considered overreaching or even unlawful. Consider negotiating for a smaller window of time for the non-solicitation agreement. Only up to two years in length may stand up in court.
Consider Other Restrictive Covenants
While a non-solicitation agreement might be the right choice for you and your employment agreement needs, consider other restrictive covenant options. Non-solicit contracts do not benefit every type of business situation. Some businesses would benefit more from non-compete agreements or non-disclosure agreements.
Shrink the Map
Employers will want their non-solicitation agreements to be as far-reaching as possible. However, it’s vital that they not overreach. Shrink the map. While it may make sense that a former employee cannot work for the arrival in the next town over, it may be asking for too much to limit the former employee from working with a company on the other side of the country. Negotiate to limit the geographical influence of the restrictive covenant.
Consider Payment for Signing the Non-Solicit Clause
If an employee is being asked to sign a restrictive covenant, they should receive something in return. The law now demands it. An employee must receive either a guarantee of employment, a signing bonus, or other benefits. As an employee negotiating for better terms, consider asking for more money or a longer guarantee of employment.
Transparency is Key
As a former employee signed to a restrictive covenant, you must tell all your future employers of the terms of your contract. Failure to disclose information about the non-solicitation clause could get you in legal trouble.
Compare with Industry Standards
Whether you are considering signing a non-solicit clause or drafting such a clause for a future employee, consider the standard practices of the competition in your field. You do not want an agreement that appears too strict compared to all of your competitors, or you may find that your image suffers in the public and, perhaps more importantly, in the industry you share.
Contact Us Today for a Case Evaluation
Restrictive covenants can be challenging to enforce, so take the time now to negotiate more agreeable terms for both sides. When negotiating, it is strongly recommended that you work with professional legal help in the form of attorneys experienced in employment law and labor law in Illinois.
The S.T. Legal Group of Deerfield, Illinois, proudly serves both employers and employees as our clients. As your legal representation, we will provide knowledgeable and highly skilled services you can feel confident in. Don’t go into negotiations alone. Consult our attorneys for your legal needs.
Contact our law firm to schedule a consultation at 847.654.9200.