Illinois Non-Compete Agreements – Additional Compensation Required

In Illinois, many companies have relied on the offer of employment or continued employment as “consideration” or adequate payment for an employee’s promise not to work for a competitor (a “non-compete” or “restrictive covenant”). In Fifield v. Premier Dealer Services, Inc. the Illinois Appellate Court recently held:

“there must be at least two years or more of continued employment to constitute adequate consideration in support of the restrictive covenant . . . .This rule is maintained even if the employee resigns on his own instead of being terminated.”

If you’re an Illinois employer who typically uses non-competes or restrictive covenants with employees, it is time to review your Illinois non-compete agreements to make sure they are enforceable. If there is no additional compensation or benefits provided to employees when they sign the agreement, it will now be unenforceable until the employee receives two years of compensation after signing an Illinois non-compete agreement.

Free Speech in the Cloud

US-centric companies should keep in mind that there are different approaches to “free” speech in Europe and elsewhere from those in the United States. Because of the different treatments, questions about which jurisdiction’s* laws govern content on the internet become important, especially when content is stored in data centers (the “cloud”) that are accessible over the Internet from different countries

A recent case in France involving Twitter is focusing on the disparity in jurisdictional approaches. A French court ordered Twitter to identify people who had posted anti-Semitic and racist entries, breaking a French law against racist speech. Twitter has said it only divulges identity of users in response to a valid US court order, the jurisdiction where its data is stored. It has already removed the content from its site in France, the jurisdiction where the posting was violating the law.

Twitter does not have an office in France, which also plays into the jurisdictional question. In the past the physical presence of a thing or a person helped determine which government’s laws prevailed, but the ability to access data makes this issue irrelevant. Complicating the issue is that in other circumstances and in other jurisdictions, Twitter has touted itself as a special defender of free speech. Think of the uprising in Egypt. There is a natural tug of war between security concerns and the need to protect privacy.

This conflict between the laws of different jurisdictions makes it difficult for companies doing business around the world over the internet.

 

*Jurisdiction indicates which legal authority has the right to deal with and make pronouncements on legal matters and to administer justice within a defined area of responsibility or geographical area such as a sovereign nation.


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