Diana Servos, principal attorney at ST Legal Group, an employment law practice in Deerfield, Illinois, has a well-earned reputation for fairness. She is as adept at successful negotiation as she is at vigorous litigation, and counts both employees and employers among her grateful clients. One area she has been especially interested in is non-compete agreements since it brings to the fore several restrictive issues that legislators throughout the U.S. are struggling to resolve.
What are Non-Compete Agreements?
Non-compete agreements clauses prevent workers from legally hiring an employee or starting a company in a type of business that competes with their ex-employer. Such agreements are usually part of the initial hiring process or part of a sale of a business, and are designed to be specific to a particular geographic region and to be enforceable for a limited period of time.
Non-compete agreements agreements are meant to prevent employees from leaving a company and drawing business away from their former employer. These agreements are typically applicable to executives and sales representatives — i.e. those with the most access to account information, marketing plans, and other private business data. Unfair competition may take place in a number of ways, such as:
- Opening a company that will compete with the business by using information absorbed while working there
- Going to work for a direct competitor of the prior company
- Using marketing tools and customized techniques that were taught there
- Using methodology or systems inaccessible had the employee not worked there
You can see why a non-compete agreement might be necessary to prevent a former (perhaps disgruntled) employee from taking steps to compete with her or his former employer. Given the former employee’s awareness of the prior employer’s strengths and weaknesses, the relocated employee, if not limited by a noncompete agreement, might be able to take unfair advantage, jeopardizing the success, or even the very existence, of the former business.
The Other Side of the Controversy
If you are an employee who has left your last position either because you were fired, resigned, or laid off, you are more than likely to look for work in a related field, one with which you are familiar, in which you have experience, and in which you may have training. Therefore, it may seem entirely unjust for a noncompete agreement to prevent you from seeking employment in the occupation you know or from starting a business of your own in your area of expertise.
Noncompete agreements usually restrict employees from doing competitive work in the same location as the former employer, but here again, the requirement of relocation may seem unreasonable. It’s difficult enough to find work and pay bills while you are unemployed. Moving away from your support system at the same time would be challenging to say the least, since it involves high cost and, often, uprooting your family from other jobs and schools as well.
How Non-compete Agreements Are Enforced In Illinois
Traditionally, Illinois courts have held employers to high standards, enforcing noncompete agreements only if they determine that the employer’s concern is “reasonable and necessary.” Nonetheless, once the employer and employee are on opposing sides, both parties should seek the counsel of a well-respected employment attorney like Diana Servos.
Whichever side of the noncompete agreement dispute you are on, contacting ST Legal Group is a wise move. We will provide you with the savvy legal advocacy you need. In some cases, a letter from Diana Servos threatening legal action is all it will take to persuade the opposing party to come to a negotiated resolution.
Illinois Legislation Involving Non-compete Agreements
In January of 2021, a bill was introduced in the Illinois House that, if enacted, would make a substantive change in the way restrictive employment covenants are handled. This law would require modifications in the way employers create and sign such documents and, in some situations, ban such restrictive covenants altogether. The bill under consideration, HB789, if passed, would go into effect on June 1, 2021.
In 2016, a law known as the Freedom to Work Act went into effect. This law forbids the enforcement of noncompete covenants against employees who earn the applicable minimum wage. Bill HB789 goes much further. If passed, it will basically replace the Freedom to Work Act, making noncompete agreements unenforceable unless the employee’s actual or expected annual earnings exceed $75,000 per year on the effective date with stipulated increases through January 2037.
There is also an important component to HB 789 stating that any noncompete agreement pertaining to an employee who was furloughed or terminated as a result of the COVID-19 pandemic, or any similar circumstance, cannot be enforced unless that employee is compensated for lost income.
Contact S.T. Legal Group’s Today for Strong Employment Law Representation in Illinois
If you find some of the details of noncompete agreements confusing, or the recently proposed Illinois legislation difficult to grasp, you are not alone. Moreover, you should be aware that we have covered only some of the complexities involved.
Whether you are an employer trying to protect your business, or an employee fighting to protect your right to earn a living, Diana Servos is the employment attorney to call. She is a talented professional who will go the distance to provide you the astute assistance you need and deserve. Contact S.T. Legal Group today to schedule an initial consultation.
S.T. Legal Group employment lawyers represent employers and employees in Deerfield, Lake, and Cook Counties and throughout the state of Illinois.