On January 1, 2017, the Illinois Freedom to Work Act (the “Act”) became effective. The Act prevents employers from entering into a non-competition agreement with a low-wage employee after January 1, 2017, which restricts the low-wage employee from performing:
- any work for another employer for a specified period of time;
- any work in a specified geographical area; or
- work for another employer that is similar to the work which the low-wage employee performs for the employer with whom he has the non-competition agreement.
According to the Act, a “low-wage employee” means an employee who earns the greater of:
- an hourly pay rate which is equal to the minimum wage required by the applicable federal, State, or local minimum wage law; or
- $13.00 per hour.
The Act makes non-compete agreements made after January 1, 2017, between an employer and a low-wage employee illegal, and it makes them void and unenforceable. However, the Act does not make non-competition agreements which were entered into before January 1, 2017 illegal, or void.
Fortunately, the Act is narrowly drafted, and it leaves Illinois employers with other legal means for preventing their employees from departing with the employer‘s customers and business information, and using these business assets to benefit the employer’s competitors. For instance, an employer can use a well drafted non-disclosure agreement to prevent an employee from disclosing or using customer or business information for the employee’s benefit, or for the benefit of the employer’s competitors. Similarly, a well drafted customer non-solicitation agreement and an employee non-solicitation agreement can be used by an employer to prevent an employee from soliciting the employer’s customers or its other employees.
The attorneys at Russel G. Winick and Associates, P.C. are ready to assist you in addressing this important subject. Our attorneys can advise you on the Act, and they can assist you with drafting non-disclosure agreements, and customer/employee non-solicitation agreements which will help you to preserve your valuable customers and business information, and prevent your employees from using them for the benefit of themselves, or the benefit of their new employer. Please feel free to call us to set up a consultation.