| |||||||
| |||||||
| 1 | AN ACT concerning employment. | ||||||
| 2 | Be it enacted by the People of the State of Illinois, | ||||||
| 3 | represented in the General Assembly: | ||||||
| 4 | Section 5. The Illinois Freedom to Work Act is amended by | ||||||
| 5 | changing Section 10 as follows: | ||||||
| 6 | (820 ILCS 90/10) | ||||||
| 7 | Sec. 10. Prohibiting covenants not to compete and | ||||||
| 8 | covenants not to solicit. | ||||||
| 9 | (a) No employer shall enter into a covenant not to compete | ||||||
| 10 | with any employee unless the employee's actual or expected | ||||||
| 11 | annualized rate of earnings exceeds $75,000 per year. This | ||||||
| 12 | amount shall increase to $80,000 per year beginning on January | ||||||
| 13 | 1, 2027, $85,000 per year beginning on January 1, 2032, and | ||||||
| 14 | $90,000 per year beginning on January 1, 2037. A covenant not | ||||||
| 15 | to compete entered into in violation of this subsection is | ||||||
| 16 | void and unenforceable. | ||||||
| 17 | (b) No employer shall enter into a covenant not to solicit | ||||||
| 18 | with any employee unless the employee's actual or expected | ||||||
| 19 | annualized rate of earnings exceeds $45,000 per year. This | ||||||
| 20 | amount shall increase to $47,500 per year beginning on January | ||||||
| 21 | 1, 2027, $50,000 per year beginning on January 1, 2032, and | ||||||
| 22 | $52,500 per year beginning on January 1, 2037. A covenant not | ||||||
| 23 | to solicit entered into in violation of this subsection is | ||||||
| |||||||
| |||||||
| 1 | void and unenforceable. | ||||||
| 2 | (c) No employer shall enter into a covenant not to compete | ||||||
| 3 | or a covenant not to solicit with any employee who an employer | ||||||
| 4 | terminates or furloughs or lays off as the result of business | ||||||
| 5 | circumstances or governmental orders related to the COVID-19 | ||||||
| 6 | pandemic or under circumstances that are similar to the | ||||||
| 7 | COVID-19 pandemic, unless enforcement of the covenant not to | ||||||
| 8 | compete includes compensation equivalent to the employee's | ||||||
| 9 | base salary at the time of termination for the period of | ||||||
| 10 | enforcement minus compensation earned through subsequent | ||||||
| 11 | employment during the period of enforcement. A covenant not to | ||||||
| 12 | compete or a covenant not to solicit entered into in violation | ||||||
| 13 | of this subsection is void and unenforceable. | ||||||
| 14 | (d) A covenant not to compete is void and illegal with | ||||||
| 15 | respect to individuals covered by a collective bargaining | ||||||
| 16 | agreement under the Illinois Public Labor Relations Act or the | ||||||
| 17 | Illinois Educational Labor Relations Act. and | ||||||
| 18 | (e) A covenant not to compete or a covenant not to solicit | ||||||
| 19 | is void and illegal with respect to individuals employed in | ||||||
| 20 | construction, regardless of whether an individual is covered | ||||||
| 21 | by a collective bargaining agreement. This subsection (e) (d) | ||||||
| 22 | does not apply to construction employees who primarily perform | ||||||
| 23 | management, engineering or architectural, design, or sales | ||||||
| 24 | functions for the employer or who are shareholders, partners, | ||||||
| 25 | or owners in any capacity of the employer. | ||||||
| 26 | (Source: P.A. 102-358, eff. 1-1-22.) | ||||||