Are non-compete agreements enforceable in Illinois?
1. Baseline Rule. Illinois combines statutory and common-law restrictions. The Illinois Freedom to Work Act (820 ILCS 90), as amended effective January 1, 2022, governs covenants entered after that date. Earlier covenants are analyzed under Reliable Fire Equipment Co. v. Arredondo, 2011 IL 111871, which adopted a totality-of-the-circumstances reasonableness test.
2. Reasonableness Factors. Courts assess (a) the protectable interest — near-permanent customer relationships, confidential information, trade secrets; (b) geographic scope; (c) temporal scope (typically up to 2 years); (d) hardship on the employee; and (e) public interest. The Act codifies these factors at § 7.
3. Consideration / Fifield Rule. Under Fifield v. Premier Dealer Services, 2013 IL App (1st) 120327, at-will employment must continue at least 2 years to constitute adequate consideration for a non-compete unless additional consideration (a bonus, raise, or equity) is provided. The Act codifies "adequate consideration" requirements.
4. Wage Thresholds. 820 ILCS 90/10 bans non-competes for any employee earning $75,000/year or less (rising to $80,000 in 2027, $85,000 in 2032, $90,000 in 2037). Non-solicits banned for employees earning $45,000/year or less (rising to $47,500, $50,000, $52,500). COVID-related terminations: covenants are unenforceable against employees laid off due to pandemic-related circumstances unless the employer pays base salary during the restricted period.
5. Blue Pencil / Reformation. Courts may modify overbroad covenants if the changes are minor; extensive rewriting is disfavored.
6. Industry Carve-Outs. Construction workers (with limited exceptions for management and trade-secret roles), licensed broadcast employees, and those covered by collective-bargaining agreements are excluded by statute. Lawyers barred by Ill. RPC 5.6. Physicians: enforceability fact-specific.
7. FTC Rule. Enjoined nationwide by Ryan LLC v. FTC (E.D. Tex. Aug. 2024); on appeal.
8. Procedural Requirements. Employer must advise the employee in writing to consult a lawyer and give 14 calendar days to review (820 ILCS 90/20).
9. Choice of Law. Covenants requiring litigation outside Illinois are void as to Illinois employees (§ 25).
This is legal information, not legal advice.
- Your annual earnings are near the $75,000 statutory threshold
- Employer failed to give you 14 days to review the covenant
- You were laid off during a reduction in force and the employer still seeks to enforce
- 820 ILCS 90 (Illinois Freedom to Work Act)
- Reliable Fire Equipment Co. v. Arredondo, 2011 IL 111871
- Fifield v. Premier Dealer Services, 2013 IL App (1st) 120327
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.