Non-Compete Agreements

Covenants not to compete, also known as noncompete agreements, are often used by businesses to prevent their employees from leaving the company and then using the knowledge they gained to compete with the employer within the same geographic territory. Such agreements are usually signed by an employee upon accepting employment, and are often intended to protect trade secrets or prevent pilfering of a business’s clients by former employees. They usually restrict a former employee from operating the same type of business or working within the same industry, within a defined territory, for a finite amount of time, which can be anywhere from one to three years. Our Chicago non-compete agreement attorneys are familiar with how these documents operate.

Illinois, like most states, enforces covenants not to compete in employment agreements as long as they meet certain requirements. First, there must be some consideration, or promise, offered by the employer to the employee in return for agreeing to refrain from competing upon termination of employment. Typically, the employment itself is considered adequate consideration. The agreement also must be reasonable in scope. The Illinois Supreme Court has established a rule that attempts to balance the interests and rights of the employer with those of the former employee while also considering the impact on the public. A non-compete agreement lawyer can assist Chicago clients with determining how this balance may affect them.

Primarily, noncompete agreements must reasonably protect an employer’s legitimate business interests without creating an undue hardship on the former employee’s ability to practice a trade or profession. They also should not deprive the public of needed services or competition for those services. In determining what are “legitimate business interests” and what are reasonable restraints on competition, Illinois courts must consider the facts specific to each individual case. The most recent state supreme court case on the matter, decided in 2011, is Reliable Fire Equipment Co. v. Arredondo, 2011 IL 111871. In that case, the Illinois Supreme Court clarified this “totality of the circumstances” test used to determine the reasonableness of noncompete covenants. “Factors to be considered in this analysis include, but are not limited to, the near-permanence of customer relationships, the employee’s acquisition of confidential information through his employment, and time and place restrictions,” the court held in its opinion.

Furthermore, while protecting confidential information and customer relationships are considered legitimate business interests, an employer’s desire simply to avoid competition within its market is not. The non-compete agreement attorneys at our Chicago firm are aware that Illinois courts, like those in most other states, look with disfavor on efforts to restrict trade. Moreover, courts will not uphold noncompete covenants that exceed the time or geographical scope necessary to protect an employer’s legitimate interests. The territory must be limited to that in which the employer operates, and the applicable time period must not be longer than is necessary to protect confidential trade information.

Clearly, Illinois employers attempting to draft or enforce employee noncompete agreements must be aware that state jurisprudence in this area will remain very case-specific. Our Chicago non-compete agreement lawyers can assist you with determining how the law applies to your specific situation.

Client Reviews
"I was referred to Peter Lubin from someone in the car business to handle a law suit. From the moment I made the appointment Peter and his staff were outstanding. This wasn't an easy case, most lawyers had turned me down. However, Peter took the time to meet with me and review everything. He took on the case, and constantly communicated with me about updates and case information. We beat this non-compete agreement case in record time. I would use him again and recommend him to my closest family and friends. 5 stars is not enough to thank him for his service." Sebastian R.
"I worked on two occasions with Peter Lubin and his staff. They took their time with me and discussed each and every item in detail. The group makes you feel like you are part of the family and not just another hourly charge. I recommend Peter to anyone who asks me for a referral. If you are looking for a top notch attorney at a reasonable rate, look no further than Lubin Austermuehle." Kurt A.
"Excellent law firm. My case was a complicated arbitration dispute from another state. Was handled with utmost professionalism and decency. Mr. Peter Lubin was able to successfully resolve the case on my behalf and got me a very favorable settlement. Would recommend to anyone looking for a serious law firm. Great staff and great lawyers!" Albey L.
"I have known Peter Lubin for over 30 years. He has represented me on occasion with sound legal advice. He is a shrewd and tough negotiator leading to positive outcomes and averting prolonged legal hassles in court. He comes from a family with a legal pedigree and deep roots in Chicago's top legal community. You want him on your case. You need him on your opponents case. He won't stop fighting until he wins." Christopher G.
"Peter and his team helped us with an auto fraud case. They communicated well (timely and very responsive), investigated deeply, and negotiated a very good settlement. We were able to resolve our significant issue without a large burden and in a manner that allowed for us to come out ahead. I'd recommend Peter and his team strongly!" R.J. Callahan