This case deals with a noncompetition agreement between an employee and a company. The court held, consistent with long-standing Illinois precedent, that a noncompete is not binding unless the employee has been employed for at least two years.
In October 2009, Premier made an employment offer to plaintiff Fifield. The offer was conditioned upon his execution of a noncompetition agreement which provided:
“Employee agrees that for a period of two (2) years from the date Employee's employment terminates for any reason, Employee will not, directly or indirectly, within any of the 50 states of the United States, for the purposes of providing products or services in competition with the Company (i) solicit any customers, dealers, agents, reinsurers, PARCs, and/or producers to cease their relationship with the Company * * * or (ii) interfere with or damage any relationship between the Company and customers, dealers, agents, reinsurers, PARCs, and/or producers * * * or (iii) * * * accept business of any former customers, dealers, agents, reinsurers, PARCs, and/or producers with whom the Company had a business relationship within the previous twelve (12) months prior to Employee's termination.'
Fifield worked for three months and resigned. Premier sought to enforce the noncompetition agreement. The trial court ruled that the agreement was void for lack of consideration because Fifield had not worked for at least two years before he quit.
The appellate court agreed that three months employment was insufficient consideration to allow the noncompetition agreement to be enforceable.
Comment: this is a rare legal decision which announces a clear rule. Whether this is a good idea remains to be seen. Some employee may quit after 23 months to avoid the noncompetition agreement and force the court to reconsider this bright line rule.
Edward X. Clinton, Jr.
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