Governor Bruce Rauner recently signed into law the Illinois Freedom to Work Act (the Act), which will prohibit private sector employers from entering into non-compete agreements with low-wage employees. The Act defines low-wage employees as those who earn the greater of: (a) the Federal ($7.25 per hour), State ($8.25 per hour), or local (currently, $10.50 per hour under the Chicago Minimum Wage Ordinance) minimum wage; or (b) $13.00 per hour.
A covenant not to compete entered into between an employer and a low-wage employee is considered illegal and void under the Act. The Act defines a prohibited “covenant not to compete” as an agreement that would prohibit a low-wage employee from: (a) working for another employer for a specified period of time; (b) working in a specified geographic area; or (c) engaging in similar work for another employer.