Challenges in Enforcing Restrictive Covenants in Illinois

The law in Illinois surrounding the enforcement of restrictive covenants has changed much over the past couple of years. A June 24, 2013 Illinois Appellate Court, First Judicial District, which has jurisdiction over Cook County, ruled that at least two years of continued employment by an at-will employee was required to constitute the ​“adequate consideration” necessary to support a valid noncompetition and nonsolicitation agreement, also commonly referred to as a restrictive covenant. Fifield v. Premier Dealer Services, Inc., 993 N.E.2d 938, 373 Ill.Dec. 379 (1st Dist., 2013). Fifield has caused Chicago employers angst and called into question the enforceability of many existing restrictive covenants applicable to employees hired in the past two years. Cases decided since Fifield, however, provide employers with some guidance. This article analyzes recent rulings and how they affect employers’ ability to craft and enforce restrictive covenants to protect their intellectual property and customer relationships.