Rep. Thomas Morrison

Filed: 3/8/2011

 

 


 

 


 
09700HB2606ham001LRB097 07292 AEK 51974 a

1
AMENDMENT TO HOUSE BILL 2606

2    AMENDMENT NO. ______. Amend House Bill 2606 by replacing
3everything after the enacting clause with the following:
 
4    "Section 1. Short title. This Act may be cited as the
5Employment Noncompete Agreement Act.
 
6    Section 5. Finding. The General Assembly finds as a matter
7of public policy that all employers have vested, protectable
8interests in their customers, clients, and identified
9prospects which are legitimately protectable through the use of
10noncompete agreements.
 
11    Section 10. Definitions. As used in this Act:
12    "Annualized compensation" means all salary, commissions,
13and cash bonuses received by an employee during the 120-day
14period ending on the last day of the month immediately
15preceding the month in which the employer-employee

 

 

09700HB2606ham001- 2 -LRB097 07292 AEK 51974 a

1relationship is terminated, multiplied by 3.
2    "Noncompete agreement" means an agreement between an
3employer and an employee that is specifically designed to
4impede the ability of an employee from competing with an
5employer upon the termination of the employment relationship.
 
6    Section 15. Requirements.
7    (a) A noncompete agreement is valid if it meets all of the
8following criteria:
9        (1) The noncompete agreement must be in writing and be
10    signed by both the employee and employer.
11        (2) The noncompete agreement may prohibit any
12    solicitation of an employer's existing customers, clients,
13    identified prospective customers, and other employees
14    during the period of any post-employment restriction
15    period.
16        (3) The duration of a post-employment restriction
17    period must have a reasonable relationship to an employer's
18    position and salary at the time of termination and may not
19    exceed the applicable maximum period as follows:
20                (A) If the employee's annualized compensation
21            at the time of termination is less than $50,000,
22            the maximum period is 6 months.
23                (B) If the employee's annualized compensation
24            at the time of termination is at least $50,000 but
25            less than $100,000, the maximum period is 9 months.

 

 

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1                (C) If the employee's annualized compensation
2            at the time of termination is at least $100,000 but
3            less than $150,000, the maximum period is 12
4            months.
5                (D) If the employee's annualized compensation
6            at the time of termination is at least $150,000,
7            the maximum period is 18 months.
8    (b) No specific or additional consideration is required to
9be paid by an employer to an employee to enforce a noncompete
10agreement.
 
11    Section 20. Remedies.
12    (a) The prevailing party in a proceeding to enforce a valid
13noncompete agreement is entitled to recover damages, costs and
14expenses, and reasonable attorney's fees.
15    (b) A subsequent employer of an employee who is a party to
16a valid noncompete agreement must honor the noncompete
17agreement. A subsequent employer who aids and abets an
18employee's breach of a valid noncompete agreement is liable for
19damages, costs and expenses, and reasonable attorney's fees
20incurred by the employer who is a party to the valid noncompete
21agreement.
 
22    Section 25. Applicability.
23    (a) This Act applies to noncompete agreements entered into
24on or after its effective date.

 

 

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1    (b) This Act does not apply to a contract to which the
2Broadcast Industry Free Market Act applies.
3    (c) This Act shall not be construed to affect or amend the
4Illinois Trade Secrets Act.".