§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Illinois is governed by 820 ILCS 90 (Illinois Freedom to Work Act, 2022). Non-competes enforceable only for employees earning above $75,000/year. Non-solicitation agreements require $45,000/year minimum. Employer must advise employee to consult an attorney.
Recent legislative developments: Illinois Freedom to Work Act (effective Jan 1, 2022) established salary thresholds, notice requirements, and right-to-counsel requirements.
§ 2. Compensation Threshold Requirements
Illinois imposes a statutory compensation threshold for non-compete enforcement. Under current law, non-compete covenants are presumptively void for employees earning below the statutory minimum. Non-compete threshold. Separate $45,000 threshold for non-solicitation agreements. The threshold is $75,000/year — but whether your total compensation qualifies depends on how your state counts bonuses, commissions, and equity.
§ 3. Temporal Limitations on Post-Employment Restrictions
Illinois does not codify a maximum duration. No statutory maximum, but must be reasonable. In practice, 1-2 years is generally considered the outer limit of reasonableness, though outcomes vary significantly based on the employee's role and access to trade secrets.
§ 4. Judicial Modification (Reformation Doctrine)
Illinois follows the reformation doctrine, granting courts broad authority to rewrite overbroad non-compete terms. This is the most employer-favorable approach — even a poorly drafted agreement may be reshaped into an enforceable restriction.
§ 5. Statutory Exemptions & Carve-Outs
Illinois law exempts certain workers from non-compete enforcement:
- Healthcare workers (partial restrictions)
- Workers who were laid off or furloughed during COVID-19 emergency
§ 6. Consideration & Contract Formation
At least 2 years of continued employment, OR adequate professional or financial benefits for existing employees. For new hires, the offer of employment itself may suffice. Whether this is legally sufficient — especially for agreements presented mid-employment rather than at hiring — is frequently contested.
§ 7. Effect of Involuntary Termination
Non-competes are unenforceable if employee was laid off, furloughed, or terminated due to circumstances related to COVID-19 or similar business disruption. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Employers must advise employees in writing to consult with an attorney before signing. Must provide 14 calendar days to review.