Impact | Business Risk Management Blog

Jennifer Abruzzo, general counsel for the National Labor Relations Board (NLRB), issued a memorandum on May 30, 2023, finding that except in limited special circumstances, non-competition agreements – including the act of merely giving employees non-competition agreements or maintaining existing ones – violate Sections 7 and 8 of the National Labor Relations Act (Act). The memorandum states, “Except in limited circumstances, I believe the proffer, maintenance, and enforcement of such agreements violate Section 8(a)(1) of the Act.”

On January 5, 2023, the Federal Trade Commission (FTC) published a proposed rule that, if finalized, would ban all employer non-compete agreements. As currently written, the proposed rule finds that it is unfair competition for an employer to:

• Enter into or attempt to enter into a non-compete clause with a worker;
• Maintain a non-compete clause with a worker;
• Represent to a worker that the worker is subject to a non-compete clause where the employer has no good faith basis to believe that the worker is subject to an enforceable non-compete clause.

The Illinois Freedom to Work Act (“Act”) became effective on January 1, 2022. The Act prohibits employers from entering into covenants not to compete and covenants not to solicit with certain types of employees. Specifically, an employer cannot enter into a covenant not to complete with an employee unless that employee’s actual or expected annualized rate of earnings exceeded $75,000 per year. Similarly, an employer cannot enter into a covenant not to solicit with an employee unless that employee’s actual or expected annualized rate of earnings exceeded $45,000 per year.

The Illinois House and Senate have agreed on a version of the Illinois Freedom to Work Act, which is waiting for Governor Pritzker to sign into law. The Act puts restrictions on which employees can be subject to covenants not to compete and covenants not to solicit.

A new Ordinance in the city of Chicago will prohibit Chicago employers from firing or disciplining workers who leave work to get a COVID-19 vaccine during the workers’ normally scheduled work hours. The Chicago City Council unanimously approved the Ordinance on April 21, 2021, and the Ordinance goes into effect immediately.

Greensfelder's John Goldstein was recently interviewed by Law360 to discuss how the pandemic has reshaped commercial real estate and created the need for certain technology updates in office buildings.

Read the full article here.

What constitutes “solicitation” in the context of a non-solicitation provision? A recent decision from the U.S. District Court for Central District of Illinois attempted to shed some light on that question.

On March 23, 2021, Illinois Gov. J.B. Pritzker signed into law Senate Bill 1480, the Employee Background Fairness Act. This impacts certain Illinois employers because it imposes new reporting and registration requirements concerning employee demographics and pay under the Illinois Business Corporation Act (IBCA) and the Illinois Equal Pay Act (IEPA), and creates new whistleblower anti-retaliation protections under the IEPA. The amendments take effect immediately.

On March 23, 2021, Illinois Gov. J.B. Pritzker signed into law Senate Bill 1480, the Employee Background Fairness Act. This impacts Illinois employers because it imposes new obligations under the Illinois Human Rights Act (IHRA) on the way they can use criminal convictions to assess employment eligibility for applicants and current employees. It also imposes new reporting and registration requirements concerning employee demographics under the Illinois Business Corporation Act (IBCA) and the Illinois Equal Pay Act (IEPA) and creates new whistleblower anti-retaliation protections under the IEPA.

Greensfelder's Scott Cruz wrote an article that was published by the Daily Herald, discussing the circumstances under which employers may implement a mandatory or voluntary COVID-19 vaccine program, as well as what exceptions could conflict with such programs.

Read the full article here.