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Non-Compete Agreements: How a Sandwich Shop Led to Changes for Illinois Workers

Posted on in Business Law

Arlington Heights business law attorneyWhen you own business that operates in a highly competitive industry, it is understandable that you would want to protect your investments, including your time, money, and efforts. If you rely on proprietary systems or recipes, you may require your employees to sign non-disclosure agreements which contractually forbids them from sharing your secrets. Similarly, if you employ a team of skilled employees, you may want to protect that investment as well by using non-compete agreements. According to the law in Illinois, non-competes may be an option, but only if your employees’ wages also represent how much you value your workers.

New Limitations

The Illinois Freedom to Work Act was signed by Governor Bruce Rauner last August and went into effect on January 1, 2017. The Act prohibits the use of non-compete agreements for employees who make less than $13 per hour. The measure was prompted, in large part, by complaints from employees of the sandwich chain Jimmy Johns. Workers at the Illinois-based chain were routinely required to sign non-compete agreements that prevented them from working for another sub shop during their employment with Jimmy Johns—and two more years after that!

While the Freedom to Work Act was being passed, Illinois Attorney General Lisa Madigan sued Jimmy Johns over its non-compete policies. The suit was settled last December with the chain claiming that it had already taken steps to remove the non-competes from new-hire paperwork before the suit was filed. Jimmy Johns did, however, agree to pay $100,000 to the attorney general’s office to be used for education and outreach programs related to the enforcement of non-compete agreements.

What You Need to Know

A properly drafted non-compete agreement may prevent an employee from working for one of your competitors while he or she is working for you and for a reasonable period of time afterward. It is important to keep in mind that you must a valid interest in protecting your business; you cannot simply limit a person’s ability to get a new job. A court may set aside a non-compete agreement if it is too broad in its scope or unconscionably limiting to the employee

If you have questions about non-compete agreements and whether they are appropriate for certain members of your team, contact an experienced business law attorney in Arlington Heights. We will meet with you to discuss your situation and help you protect your business while remaining in full compliance with the law. Call 847-749-4182 for a confidential consultation today.

 

Sources:

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=3737&ChapterID=68

http://www.chicagotribune.com/business/ct-jimmy-johns-settlement-1208-biz-20161207-story.html

http://www.chicagobusiness.com/article/20161207/NEWS07/161209881/jimmy-johns-backs-off-controversial-noncompetes-in-deal-with-illinois-ag

Illinois State Bar Association DuPage County Bar Association Northwest Suburban Bar Association American Inns of Court DuPage Association of Woman Lawyers National Association of Woman Business Owners Illinois Association Criminal Defense Lawyers DuPage County Criminal Defense Lawyers Association
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