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Validity Of Non Compete Agreements In Illinois

In practice, courts consider three factors to determine whether a non-compete agreement is applicable: in short, in Illinois, a non-compete agreement (sometimes incorrectly referred to as “no-compete”) is an agreement often signed by an employee when hiring or accepting a severance package. The non-compete agreement generally limits a worker to compete with his former employer during and after the termination of his employment contract. This is done by restricting the geographic area in which a worker can work when his new position is present in the same sector as his or her former job. Non-competition prohibitions often continue to protect the employer by preventing a worker from using an employer`s confidential information for his or her benefit or for the benefit of a subsequent employer. A typical non-competition agreement has the effect that “the worker accepts that he or she will not work for a similar company in the same or similar role within 10 miles of the employer`s seat during employment and one year after.” The questions are always: is this possible? A valid and enforceable non-competitive agreement generally contains provisions for enforcement and redress in the event of an infringement. An employer may sue for breach or a worker may ask to declare that the agreement is invalid or unenforceable, either in general or with respect to the worker`s circumstances. Corrective measures in the event of a breach of a no-competition agreement could include liquidated damages, compensation for an employer`s actual losses, or rights to omission. There is a court split between federal judges in the Northern District of Illinois and the Illinois Appellate Court, First District, over whether two years of employment retention are necessary to support a non-competitive provision in an employment contract under Illinois law. In 2013, the Illinois Court of Appeals, First District, found that at least two years of employment (without further consideration) are required to support a non-compete clause or an unclaimed clause in an employment contract. Fifield v. Premier Dealer Servs., Inc., 373 fig. 379, 993 N.E.2d 938 (Ill.App.1st Dist.

2013). Otherwise, the provision of competition or non-invitation is not applicable for lack of consideration, even if the worker has voluntarily left his employment relationship.

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