(820 ILCS 90/1)
Sec. 1. Short title. This law may be referred to as the Illinois Freedom to Work Act.
(Those: PA 99-860, eff. 1-1-17.)
(820 ILCS 90/5)
Sec. 5. Definitions. In this law:
“Fair consideration” means (1) the employee has worked for the employer for at least 2 years after the employee signs an agreement that contains a non-compete obligation or a non-advertising obligation, or (2) the employer otherwise establishes a has provided reasonable consideration to support a non-competition or advertising non-competition agreement, the consideration for which may be tenure of employment and additional professional or financial benefits, or professional or financial benefits that are reasonable in and of themselves.
“Non-Compete Commitment” means an agreement between an Employer and an Employee entered into after the Effective Date of this Amendment Act of the 102nd
- (1) any work for another employer for a specified period of time;
- (2) any work in a specific geographic area; or
- (3) Work for another employer that is similar to the worker's work for the employer that is a party to the contract.
“Non-compete” also means an agreement between an Employer and an Employee entered into after the Effective Date of this Amendment Act of 102 Competitive Activities after the Employee's employment relationship with the Employer has ended.
“Commitment not to compete” does not include (1) a commitment not to advertise, (2) a confidentiality agreement or commitment, (3) a commitment or agreement prohibiting the use or disclosure of any trade secret or invention, (4 ) invention assignment agreements or understandings, (5) an agreement or understanding entered into by a person who buys or sells the goodwill of a business or otherwise acquires or disposes of an ownership interest, (6) clauses or an understanding between an employer and an employee, that require prior notice of termination of employment during which the employee remains employed by the employer and receives compensation, or (7) agreements in which the employee agrees not to re-apply to the same employer after the employee's termination.
“Commitment Not to Solicit” means an agreement made after the enactment of this Amendment Act of the 102nd Restricts the Employee, for the purpose of selling products or services of any kind to customers, prospective customers, vendors, prospective vendors, suppliers, prospective suppliers or Solicit other business relationships of the Employer to sell any product or service or interfere with the Employer's relationships.
“Earnings” means compensation, including salary earned, bonuses earned, commissions earned, or any other form of taxable compensation, reported or expected to be reported as wages, tips, and other compensation on the employee's IRS Form W-2 plus all Elective deferrals not listed as wages, tips, and other compensation on the employee's IRS Form W-2, such as employee contributions to a 401(k) plan, a 403(b) plan, a flexible spending account, or a health savings account or commuter allowances.
"Employee" means any person permitted to work in an occupation by an Employer.
“Employer” has the meaning given to that term in subsection (c) of Section 3 of the Minimum Wage Act. “Employer” does not include government or quasi-government entities.
“Construction” means any building, altering, reconstructing, repairing, rehabilitating, refinishing, refurbishing, remodeling, refurbishing, renovating, customizing, maintaining, landscaping, enhancing, demolishing, painting, decorating, demolishing and adding to or removing any building, structure , highway, pavement, road, bridge, alley, sewer, ditch, sewage treatment plant, waterworks, parkway, railroad, excavation or other structure, project, development, real estate or improvement, or to do any part thereof, whether the execution The work described herein may or may not involve the addition or manufacture of any structure, project, development, property or improvement of materials or articles of commerce described herein.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/7)
Section 7. Employer's Legitimate Business Interest. When determining the legitimate business interest of the employer, all of the facts and circumstances of the individual case must be taken into account. Factors that may be considered in this analysis include, but are not limited to, the employee's exposure to the customer relationships of the employer or other employees, the near-permanent customer relationship, the employee's acquisition, use, or knowledge of confidential information through employment , the time restrictions, the location restrictions and the extent of the activity restrictions. No factor has more weight than others, but its importance depends on the specific facts and circumstances of the individual case. Such factors are merely inconclusive tools in determining the employer's legitimate business interest, which in turn is only one component of the 3 pillar rule of common sense that arises from the totality of the circumstances. Each situation must be determined by its own particular facts. Appropriateness is measured not only in some but in all circumstances. The same identical contract and retention may be appropriate and valid in one set of circumstances and inappropriate and invalid in another set of circumstances.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/10)
Section 10. Prohibition of agreements not to participate in competitions and agreements not to advertise.
(a) No employer shall undertake any obligation not to compete with an employee unless the employee's actual or projected annual rate of earnings exceeds $75,000 per year. This amount increases to $80,000 per year from January 1, 2027, $85,000 per year from January 1, 2032, and $90,000 per year from January 1, 2037. Any commitment not to compete made in breach of this subsection is void and unenforceable.
(b) No employer shall undertake any obligation not to advertise to any employee unless the employee's actual or projected annual income exceeds $45,000 per year. This amount increases to $47,500 per year from January 1, 2027, $50,000 per year from January 1, 2032, and $52,500 per year from January 1, 2037 and is not enforceable.
(c) No Employer shall undertake any undertaking not to compete with or poach any employee who is terminated or placed on leave or fired by an Employer as a result of business circumstances or governmental orders related to the COVID-19 pandemic or circumstances related to the COVID -19 Pandemic, except where enforcement of the non-competition clause includes compensation equal to the employee's base salary at the time of termination for the period of enforcement less compensation earned through subsequent employment during the period of enforcement. Any non-competition or advertising non-competition agreement entered into in violation of this subsection is void and unenforceable.
(d) A non-competition clause is void and unlawful with respect to persons covered by a collective bargaining agreement under the Illinois Public Labor Relations Act or the Illinois Educational Labor Relations Act and persons employed in the construction industry. This subsection (d) does not apply to construction workers who perform primarily managerial, engineering or architectural, design or sales functions for the employer or who are shareholders, associates or owners in any capacity of the employer.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/15)
Section 15. Enforceability of a non-compete or advertising ban. A non-competition or advertising ban is unlawful and void unless (1) the employee receives reasonable consideration, (2) the agreement is ancillary to a valid employment relationship, (3) the agreement does not exceed the protection required of a legitimate business interests of the employer, (4) the agreement does not impose undue hardship on the employee, and (5) the agreement is not harmful to the community.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/20)
sec 20. Ensure employees are informed of their duties. A non-competition or advertising ban is unlawful and void unless (1) the employer instructs the employee in writing to consult an attorney prior to entering into the contract, and (2) the employer provides the employee with a copy of the agreement at least 14 calendar days before the start of the employee's employment or the employer gives the employee a period of at least 14 calendar days to review the commitment. An employer will also comply with this section if the employee voluntarily chooses to sign the agreement before the 14-day period is up.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/25)
Sec 25. Appeals. In addition to any remedy available under an agreement between an employer and an employee or under any other law, in a civil claim or arbitration brought by an employer (including, but not limited to, a complaint or counterclaim) If an employee prevails in a claim to enforce a non-compete or advertising prohibition, the employee must recover from the employer all costs and all reasonable attorneys' fees related to such claim to enforce a non-compete or advertising non-competition and the court or the arbitrator may obtain an appropriate remedy to speak.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/30)
Section 30. Enforcement by the Attorney General.
(a) Whenever the Attorney General has reason to believe that any person or entity is engaged in a pattern and practice prohibited by this Act, the Attorney General may institute a civil action on behalf of the people of the State or intervene each competent court to obtain an appropriate remedy.
(b) Prior to the commencement of any action, the Attorney General may conduct an investigation and: (1) require any person or entity to file a statement or written report, under oath or otherwise, with respect to any information that the Attorney General may provide for deems necessary; (2) to examine under oath any person allegedly involved in or known to have been involved in the alleged violation; or (3) issue subpoenas or conduct hearings in support of investigations.
(c) Service by the Attorney General of a notice requesting any person or entity to file a statement or report, or a subpoena on any person or entity, shall be:
- (1) in person, by delivering a duly executed copy thereof to the person to be served or, if a person is not an individual, in the manner provided for in the Code of Civil Procedure when a complaint is lodged; or
- (2) by sending a duly made copy thereof by registered mail to the person to be served on service at his or her last known residence or principal place of business in that State or, if a person is not an individual, in the manner provided for under the Code of Civil Procedure when a complaint is made.
The Attorney General may enforce compliance with investigative requirements under this section by order of a court of competent jurisdiction.
(d)(1) In a claim brought under this Act, the Attorney General may obtain, as a remedy, monetary damages to the State, redress and equitable relief, including a permanent or injunctive injunction, injunctive relief or other order, including an injunction , prohibiting the accused from engaging in any violation, or order appropriate action as appropriate. In addition, the Attorney General may request and the court may impose a civil penalty not exceeding $5,000 for each violation or $10,000 for each repeat violation within 5 years. For purposes of this section, each violation of this law is a separate and distinct violation for each person who has been the subject of an agreement that violates this law.
(2) A civil penalty imposed under this subsection shall be deposited into the Attorney General-ordered and voluntary compliance payment project funds. Fund monies will be used, subject to earmarking, to perform any functions associated with the performance of the Attorney General's duties, including, but not limited to, enforcing laws of that State and conducting public education programs; however, any monies of the Fund to be used for a particular purpose by judicial or contractual means shall be used for that purpose.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/35)
Sek. 35. Reformation.
(a) Comprehensive judicial reform of a non-compete or advertising ban may be contrary to the public order of that State, and a court may refrain from completely rewriting contracts.
(b) In certain circumstances, a court may, in its discretion, decide to reform or vacate provisions of a non-competition agreement or a non-bid agreement rather than declaring such agreement unenforceable. Factors that may be considered in determining whether such reform is appropriate include the fairness of the limitations as originally written, whether the original limitation reflects a good faith effort to protect a legitimate business interest of the employer that Extent of such reform and whether the parties have included a clause in their agreement allowing for such changes.
(Those: PA 102-358, eff. 1-1-22.)
(820 ILCS 90/97)
Section 97. Severability Clause. The provisions of this Act are severable in accordance with Section 1.31 of the Articles of Association.
(Those: PA 102-358, eff. 1-1-22.)